Econet Being Dishonest, People Of Zimbabwe Paid USD$60 Million On Behalf Of Econet: Mandiwanzira
Information and Communication Technology (ICT) minister Supa Mandiwanzira yesterday denied reports of that Econet wireless paid its licence in full, when he appeared before the Parliamentary Portfolio Committee on ICT chaired by Kuwadzana legislator Nelson Chamisa.
In the beginning of the liberization of the telecommunications era, the government issued mobile licences to two privately owned operators, Econet Wireless and Telecel Zimbabwe in 1998.
The Licence were for 15 years tenure, and the and the basic licence fee for each for each licence was set at U$100 million and in 2013 the renewal licence fees was increased to $137,5 million for a 20 year tenure. In addition, Mobile Network Operators (MNOs) also paid annual licence fees, spectrum fees and made a contribution to the Universal Service Fund, whose objective is to extend services to rural and other under-served areas.
“I would like to say that is actually a lie that Econet paid its licence in full. It’s misrepresentation that has been repeated over and over again to make it a fact but I would like to say that today it actually is not a fact.” Said Supa Mandiwadzira.
“That was an unprecedented statement by Econet. It might not actually be anger on issues to do with telecoms, but it may be someone connected to Econet, who might have wanted to pronounce a United States President Donald Trump-style bid to stand for the presidency,” the Minister added.
In addition, MNOs were paying an annual licence fee (2% of audited annual gross turnover), and contribute to the Universal Service Fund (0.5% of audited annual gross turnover). They will also paid frequency spectrum fees in accordance with their different requirements of that limited national resource.
In 2013 Econet smartly negotiated with the government to offset monies owed by TelOne and NetOne though interconnection fees against the new US $137.5 million mobile licenses fees. This resulted in , Econet only paid $50 million cash.
“What Econet did was that it negotiated with Government that “Oh, by the way, as we are renewing our licence we are owed money by NetOne and we are also owed money by TelOne. Can you as Government take over those loans, those amounts which were accumulated in their day to day operations between their business entities. ” They then asked the Government to take over that liability and pay to POTRAZ the licence fee. That is the truth of the matter. $60 million was paid by the people of Zimbabwe, not by Econet.” Added Supa.
Parliament heard that use Over The Top services was bleeding the telecoms industry, and last year between June and April last year, network operators lost 186 million minutes in voice revenue to Skype, WhatsApp and Facebook calling, with potential monetary loss being $26 million.
This year ,Econet CEO Douglas Mboweni told the Parliamentary Portfolio Committee on ICTs that Econet has been subjected to an uneven playing field for a long time.
Mr Mboweni argued that NetOne and Telecel can afford to provide affordable data prices because they have softer terms for licence renewal fees.
“We had raised the issue of a level playing field and this is not the first time. It happened with the $137 million licence fees which Econet paid in full but others are yet to pay,” Mboweni said.
Mandiwanzira also dismissed claims by Econet concerning uneven playing field.
“How many businesses who do business with Government or parastatals are owed huge amounts of money and the Treasury has not taken over those amounts? Many companies. But in this particular case, Econet had the advantage of having its $60 million debt taken over by Government, and Government took from the people of Zimbabwe through the taxes they pay, $60 million to pay to POTRAZ as part of the licence fee for Econet.”
“Those are the facts, Mr Chairman. And that is what happened. So when people sit before your committee and say we paid our licence fee in full they are being dishonest. The truth is the people of Zimbabwe paid $60 million of that amount on behalf of NetOne and TelOne.”