Telecel: have the heavy weights really tumbled?


It was almost like being slapped in the face. Strive Masiyiwa who had been battling for a cellular telephone network licence for more than four years was awarded the tender to provide a service in neighbouring Botswana, beating local and international competition.

All he could say was: “The Lord opens doors no man can shut. Glory to God.” And indeed, God opened the doors for him not only in Botswana but at home as well, for barely three weeks later he was granted the cellular telephone network licence he had been battling for for more than four years. Most people had lost hope that he would ever be granted the licence despite his numerous court battles.

Now it was Telecel Zimbabwe’s turn to cry foul. In half-page adverts splashed in the national daily, The Herald, entitled: “You must have wondered who we are. Telecel said it had committed over $400 million in the project. Healthy competition can only be of benefit,” the company said yet it was the first to shut out other bidders when the government said it should take on the losers as partners after it won the tender to operate Net Two last year. It would not even entertain the idea of having a third network.

The advert said: “Telecel Zimbabwe is a unique partnership between the Empowerment Corporation, a consortium of indigenous community associations and business groups and Telecel International of the USA. As the majority shareholder, the Empowerment Corporation represents the interests of such groups as the Zimbabwe War Veterans Association, the Indigenous Businesswomen’s Organisation, the Affirmative Action Group and the Zimbabwe Miners Association.

“Together, these organisations speak for many thousands of members, all of them Zimbabwean, with an interest in Telecel Zimbabwe. Further powerful voices in the shareholding are the Kestrel Corporation and the Integrated Engineering Group, dynamically successful companies helping build our nation. Telecel International, the minority partner, supplies the technology and cellular communications expertise that has developed cellphone systems in eight African countries over the past ten years – a track record of success that has helped build economies, create employment and prosperity, for countless people. With the aim of providing these same benefits to the people of Zimbabwe, we have committed over $400 million in investment. You (not we) need a first class telecommunications service that is dynamic, efficient, affordable. Healthy competition can only be of benefit.”

Quite impressive, but what the advert did not say was that while Zimbabwe indeed needed a dynamic and efficient telecommunications service, as the Posts and Telecommunications Corporation is failing to cope, Telecel had already failed to meet its original target for delivery. When it won the tender on March 6 last year, Telecel said its network would be operational in both Harare and Bulawayo “in or before September, six months from now”.

The network is not operational today and this had nothing to do with the court battle with Masiyiwa. In fact, sources say the company had asked for an extension of the period in which to come on air from the government, but because it was too embarrassed with the way Telecel had won the tender, the government had denied the extension. Some observers are wondering what would have happened had Telecel met its target, as it would have been on air for four months before the High Court decision. Would it have been asked to cease operations?

And while the advert claimed that Telecel International had a track record of success that has helped build economies, create employment and prosperity, for countless people, sources who were interviewed by The Insider last year actually said that Telecel meant disaster.

“Telecel is not just into cellular phones,” a source said. “They are also into politics. Zimbabwe could have made one of its biggest blunders by allowing them in because they have been responsible for the chaos in Zaire. Of course, some of us who have been forced into exile are quite happy Mobutu is gone. But you cannot trust Telecel because there is a wide belief that they did the same thing in Burundi and in Rwanda. They came to Zaire and entered into business with Mobutu but when they realised they no longer needed him they teamed up with the rebels.

“This is the kind of people your people have entered into business with. They are in it for money. They will make money using locals. They will not invest that money but will take it out. They invest very little and get a lot from the market. If you were to ask them to put up the entire infrastructure for the cellular network they would not do so. Any business involved in politics to the extent of Telecel is no good.”

This statement remains unchallenged almost six months after first publication and Telecel Zimbabwe’s cellular network is still not on line nearly six months after the promised delivery date. Telecel international was Masiyiwa’s partner but ditched him when they discovered things were not going his way.

With Telecel still fighting to stay in business, some people have now written off the cellular network battle as really a battle of the people from Mashonaland Central, a battle more about personalities. When former Information Minister, David Karimanzira, was kicked out and reduced to a provincial governor, he was replaced by Joyce Mujuru, probably the highest ranking politician from Mashonaland Central. This put into the arena Strive Masiyiwa, James Makamba of Kestrel and Telecel and Bornwell Chakaodza, the Ministry of Information’s spokesman.

There were cries of conflict of interest when Mujuru awarded the tender to Telecel because Makamba had been her husband’s business partner, but this fell on deaf ears. When Mujuru was moved to Water Resources, she was replaced by Chen Chimutengwende also from Mashonaland Central. Some people are arguing that at a time when most people in ZANU-PF are forming regional economic empowerment groups, why should people waste their time on those who continue to fight yet they have the same goal?

But, some observers, are also closely watching how Chimutengwende will play his cards. Having given in and promising that the government will not contest Masiyiwa’s victory, and there only being licences for two networks, will he not succumb to pressure to allow Telecel to sneak into Net One? After all, Telecel has heavyweights such as Makamba, Leo Mugabe, Phillip Chiyangwa and Chenjerai Hunzvi and PTC is being privatised anyway. While Makamba seems to have adopted a reconciliatory attitude, he seems to have changed his mind and is appealing against the High Court ruling. His colleagues, Hunzvi and Chiyangwa have always been uncompromising.

They have been arguing as if Masiyiwa has no right to carry out the project. It appears, as the advert says, the majority — or those who represent the interests of thousands of Zimbabweans– have to get the job no matter what. But Chimutengwende is in a tight spot. If he accommodates Telecel into Net One, how will this be taken by both local and international investors? After all, he has not endeared himself with the business community because of his statements in the past few weeks.


See also: Telecel: Is it into business or politics?


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Charles Rukuni
The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.


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