Mergers, Acquisitions and Financial Results

Government has urged mobile phone service providers to sell 41 per cent of their shares on the Zambian market as a way of protecting national interests in the telecommunication sector, while promoting investment.

The State has, however, denied reports that MTN and Celtel had been allowed to invest millions of dollars in mobile phone infrastructure with a belief that the international traffic market would be opened up in Zambia.

The Ministry of Information and Broadcasting Services said in a statement in Lusaka yesterday that Government was mindful of the consequences that could arise from privatisation and opening up of the international traffic market.

Government said it liberalised the international traffic market in 2002 and it was the private mobile phone service providers that were hesitant in establishing the international gateway. The ministry was responding to recent media reports alleging that Government had ignored the expert advice on the question of liberalising the traffic market. Government accused the mobile service providers of resisting the payment of licensing fees that were far lower than those in the neighbouring countries.

Zambia was charging $100,000 for a mobile phone provider licence while countries like Kenya were charging $55 million and Zimbabwe $100 million. The mobile phone providers were also opposed to the requirement for operators to sell some of their shareholding to local investors. "It is the mobile phone operators that have failed to take advantage of the liberalised traffic to establish an international gateway," the ministry said.

The ministry was surprised that there were some people masquerading as experts who expected Government to introduce measures in the field of international communication without taking into account the impact on the national social-economic state. "Government knows that countries such as Kuwait and South Africa where MTN and Celtel operate have not liberalised the international gateways," the statement read.

The statement said while in countries such as Kenya, Telkom Kenya was given a five-year monopoly before the private operators could start working, Zambia's Zamtel was never a monopoly since 2002 when operators were allowed to establish an international gateway.

"Government would like to see the benefits of the liberalised traffic also accrue to Zambians and in this respect Government requires MTN and Celtel to offload up to 41 percent shares to the Zambian public. It is regrettable that these operators have resisted this provision," the statement said.

The Times of Zambia