Zimbabwe Telecel Still Viable, Says Potraz

14 FEBRUARY 2022

The Herald (Harare)

THE Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) says Telecel Zimbabwe remains a viable business entity as long as it accesses foreign currency timeously.

Potraz director-general, Gift Machengete, said the telecoms regulator was confident of the mobile phone operator's ability to sustain operations provided it accesses the requisite foreign currency for critical external payments.

Data from the telecoms regulator shows that between the first quarter of 2017 and third quarter of 2021, Telecel's total mobile revenue share shrank.

The data also shows that the Government-controlled mobile network operator experienced a marked decline in share of the revenues among industry operators.

"We do not believe Telecel will collapse, their operating licence is intact and they have enough subscribers and running services to sustain their operations," Dr Machengete said.

"Should any mobile network provider decide to stop operations, they are mandated to give ample notice to allow subscribers to move to another network and to also allow subscribers to exhaust their airtime, SMS or data balances," he said.

Dr Machengete said telecoms companies operating in Zimbabwe should be prioritised in foreign currency allocation by the Reserve Bank of Zimbabwe (RBZ).

However, the telecoms outfit has revealed that it is battling "spiralling operational costs".

Company spokesperson, Zitha Dube, said the telecommunications firm required urgent capital injection to stay afloat.

Last week, Telecel revealed that it experienced widespread network challenges after its subscribers struggled to access voice calls and data services for several days.

Ms Dube said the challenges had since been resolved, with the company now facing financial challenges, which once resolved, the company would return to operating on sound footing.

"We have a strategic plan in place which is awaiting funding from a number of initiatives currently being pursued. Like any other company operating in Zimbabwe, the inflationary environment has resulted in spiralling operational costs which are not in tandem with the increase in revenue," Dube said.

She said the telecommunications sector was capital-intensive and required foreign currency for procurement of equipment for expansion.

"Given these circumstances, we believe that our gearing levels are acceptable. The telecom operators are continuously engaging the regulatory authority for viable tariffs," Dube added.

While the mobile phone network outsources a number of inputs from external suppliers, some foreign service providers have in the past threatened to stop servicing local telecommunication firms over non-payment.