Forum raps Potraz over Telecel licence cancellation

James Makamba

The recent attempt by government through the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) to cancel Telecel’s operating licence discourages foreign direct investment and renders the country uncompetitive for business, a black business empowerment forum has said.

By Staff Reporter

Washington Mehlomakulu, a member of the Black Business Forum — a grouping of young entrepreneurs who seek to promote networking and co-operation among the young businesspeople — said the decision to cancel Telecel’s licence had long-term investment effects.

“We don’t have much foreign direct investment coming into the country, but we have a situation where a company is being closed.

What kind of message are we sending concerning protection of investment?” Mehlomakulu asked.

Telecel Zimbabwe had its licence cancelled last month by Potraz due to reported non-compliance with the required shareholding structure which demanded that local indigenous people must be majority owners of the company.

“We are yet to see a company that has been closed because it has not complied with the indigenisation law,” Mehlomakulu said.

“This was irrational and as black businesspeople we believe it was not done with an aim of bringing competition to the business sector.”

The forum, which sought to unravel the future of business in Zimbabwe in light of the attempt by Potraz to cancel the second-largest mobile operators’ licence, saw Potraz officials coming under attack from the young businessman who felt the State regulator was unfair and “retrogressive”.

Currently, Telecel is owned by Amsterdam-based Vimpelcom with 60% stake while locals have the minority 40% through the James Makamba-led Empowerment Corporation.

The government wants locals to own at least 51%.

Besides the shareholding structure, Potraz cancelled Telecel’s licence allegedly due to its failure to pay $137 million for the 20-year licence.

But Kennedy Dewera, the director responsible for Postal and Courier service who spoke on behalf of the Potraz director-general, said the State regulator had given Telecel enough time to put its house in order, but the company had failed to oblige.

He said the recent cancellation was the second since the establishment of Telecel — a move which showed that the entity was not serious about complying with the country’s laws.

Telecel licensing has always been political and couched in strong indigenisation and empowerment rhetoric.

At its formation, the local shareholding structure had a mottle of indigenisation luminaries — Jane Mutasa, Philip Chiyangwa, Leo Mugabe, war veterans, small-scale miners and Makamba.