TANZANIA WARNED AGAINST BABY-SITTING ITS TELCO

Tanzania Telecommunication Company Ltd offices. Experts are cautioning the government against giving it preferential treatment.

As plans to restructure Tanzania Telecommunication Company Ltd (TTCL) into a communications corporation gather momentum, experts are cautioning the government against giving it preferential treatment.

Works, Communications and Transport Minister, Prof Makame Mbarawa, a week ago tabled a Bill in Parliament to establish the Tanzania Telecommunications Corporation (TTC) in place of TTCL to enhance “safety, security, economic and commercial viability of national telecommunications services and telecommunications infrastructure”.

TTCL, whose roles will be transferred to the new entity, has enjoyed a monopoly in managing the National ICT Broadband Backbone. TTCL collects the levies paid by other companies to connect to the backbone.

“The ICT backbone is government property and there is a special account where the funds go; the benefit we get is a management fee,” said TTCL public relations manager, Tom Mushi.

According ICT Works, an industry lobby, companies pay a flat rate of $180,000 per year to provide Internet bandwidth across the country.

Experts have, however, cautioned that to ensure the survival of the new corporation, the government should not interfere in its operations or favour it in the current competitive market.

Competition

Fair Competition Tribunal (FCT) legal advisor Kunda Mkenda said that a competitive environment should be allowed to flourish in every sector of the country.

“There should be fair play in every sector; this will avert complaints and it will be good for customers as well,” he said.

TTCL was partially privatised in 2001, but in June 2016, the government signed a share transfer agreement to conclude the end of partnership with Bharti Airtel after it bought back 35 per cent of its shares.

TTCL is now 100 per cent owned by the government. The company has a history of financial instability and has been under various joint managements. It has also gone through several restructurings.

Treasury Registrar Oswald Mashindano said recently that TTCL’s Tsh76.6 billion ($33,841,000) debt to the government was converted into capital last month, to enable the telco list its shares on the Dar es Salaam Stock Exchange.

READ: State-owned telco allowed more time to list on Dar Stock Exchange

However, TTCL’s biggest challenge is collecting debt, most of which is owed by public institutions. A report by the company indicates that some Tsh6.8 billion ($3 million) owed has been paid so far out of a total Tsh10.7 billion ($4.8 million), with plans for all debt to be paid by the end of December.

Deputy Minister for Works Atashasta Nditiye, on Wednesday directed the company to take legal action against customers who have not paid their debt.

The East African