 | Issue: | Latin America II 1998 |
| Article no.: | 2 | |
| Topic: | Telecommunications Development in Zimbabwe | |
| Author: | Chen Chimtengwende, M. P. | |
| Title: | Minister of Information, Posts and Telecommunications | |
| Organisation: | Zimbabwe | |
| PDF size: | 20KB |
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Article abstract
Connect-World is delighted to showcase Zimbabwe, a country where 75% of the population live in the countryside and has a teledensity of 2%, a measure considerably below the world average. Here, Minister Chimtengwende explains how Zimbabwe aims to achieve a robust and pervasive communications infrastructure that will be part of the Global Information Infrastructure. A lesser vision would mean oblivion for Zimbabwe in the next millennium.
Full Article
Zimbabwe, land of the thunderous Victoria Falls and the ruins of Great Zimbabwe, is heir to an unparalleled wilderness, Gonarezhou, Hwange, the Zambezi River and Matusadona. The capital city is Harare. The other cities are Bulawayo, Masvingo, Mutare, Gweru, and Chitungwiza. About 70% of Zimbabweans still live on small farms, growing maize and selling tobacco. Zimbabwe’s real beauty lies on its borders, such as the Zambezi River Valley with its riverine forests and hippo; Lake Kariba with fighting tiger fish and island safari lodges; and Hwange National Park, supporting the world’s greatest concentration of elephants. Most Zimbabweans are Shona, a substantial minority Ndebele. English is one of the official languages, and is spoken by everyone, although a total of seven languages are spoken in the country. Zimbabwe has a population of 11 million, 25% of which live in urban areas. Harare is home to more than 50% of the population, and is serviced by satellite Chitungwiza. Some 60,000 Zimbabweans have English as their native language and Europe as their roots. Many of the elderly live in the rural areas, while 20% of the rural population live on large commercial farms. Development of Communications Infrastructure The Ministry for Information, Posts and Telecommunications (MIPT) is committed to a rapid development of the communications infrastructure. The teledensity should rise from the current 2% to at least 10% in the next five years. There should be a telecentre in every village and low-income urban suburb in the next five years. The immediate objective of the Zimbabwe Posts and Telecommunications Corporation (PTC) is to expand the telecommunications services to a point where intending subscribers can be connected on demand. Secondly, the quality of the service will also be improved drastically. The aim is to achieve all this by the year 2000. This will be achieved through the on-going PTC projects plus the new Build-Operate-Transfer (BOT) and profit scheming projects that are currently being negotiated. The current registered demand for the fixed telephone service is about 345,000 made up of 225,000 customers on main lines and a waiting list of 120,000. Compare this with 5 years ago when, in June 1993, the statistics showed that total demand was 227,700 made up of 128,000 main line customers and 99,700 on the waiting list. In other words, despite investments of over Z$3 billion the PTC connected close to 100,000 new customers but the waiting list did not remain static and, instead, grew to 120,000 lines. Although within the same period teledensity improved from 1.3 to 1.8 phones per 100 in the population, this is insignificant considering we are on the same planet and in the same global village as countries with teledensities of 70 phones per 100. When split into urban and rural teledensities the situation reveals that the majority of the citizens of Zimbabwe have inadequate access to phone services. For instance the teledensity in urban areas is about 5.8 phones per 100 in the population, whereas it is about 0.3 phones per 100 in rural areas. The fixed telephone network is now complemented by the Net*One Cellular Mobile Telephone Services, which has experienced substantial growth from zero to 19,800 customers within the space of a year. Net*One now boasts of coverage in all the major cities in Zimbabwe namely, Harare, Bulawayo, Masvingo, Mutare, Gweru, and Chitungwiza. Tourist areas covered include Victoria Falls, Kariba and Nyanga. The major trunk road between Harare and Bulawayo is covered, thereby capturing the towns of Redcliff, Kwekwe, Kadoma, Chegutu and Norton. There has also been growth in the use of Internet services since its launch by the PTO in March 1996. It is estimated that there are over 8,000 Internet users in Zimbabwe at present. On the postal side, the network grew from 273 postal outlets (175 full post offices, 4 sub-post offices, and 94 postal agencies) in 1993, to 289 postal outlets (184 full post offices, 59 sub-post offices and 46 postal agencies) in 1998. Many postal agencies in the rural areas were upgraded to sub-post offices offering more services. The PTC’s postal service at present has a density of 42,000 persons per postal outlet, which it seeks to reduce to 20,000 persons per postal outlet. Policy Shift The demand-supply gap in both the Telecommunications and Postal services is a result of under capitalisation. The PTC’s. sources of funding are limited to borrowing and own generated resources. These traditional sources of financing are inadequate to finance growth in the communications sector. Furthermore the PTC as a statutory corporation is burdened with the attendant constraints of government controls on borrowing, purchasing and investment, an environment which is not conducive to commercial operation. Existing statutory instruments, which govern the Postal and Telecommunications sector, are not keeping up with the rapid technological advancements and the challenging dictates of the market place. Hence the need for the policy shift to enable meaningful growth in the sector. The government recognised the pervasive and profound role that the Postal and Telecommunications sector plays in economic development, and in delivery of social services such as health and education. The Sector Reform policy was announced by MIPT in 1996 to address the following governmental objectives: · universal access · improvement of service availability · improvement of service quality · affordability · development of new services In essence the policy shift intends to achieve the aforementioned objectives by: · commercialising the PTC · deregulating the sector to allow other players · setting up a regulatory mechanism to oversee the introduction of com petition in the sector. The Minister of Information Posts and Telecommunications announced further policy enhancements in 1997, to enable private sector funding into the sector. Implementation of the Sector Reform Policy has begun. First the Attorney General’s office has been tasked with producing the Communications Bill which will, among other things, provide for the following: · Establishing a Communications Authority, a body that will assume the functions of regulation of the Posts and Telecommunications sector · Repealing the existing Posts and Telecommunications Services Act; and liability to the successor company; and, · Transferring of the FTC’s assets and liabilities to the successor company. Enactment of the Bill, which is expected this year, will pave the way for the corporatisation of the FTC’s successor company under the Companies Act, and the formation of four business units as subsidiary companies, namely fixed telecommunications, cellular, postal and manufacturing. Commercialisation Process The commercialisation process has started already as the FTC has acquired the services of an experienced consulting company to start the process of internal restructuring. Within a period of 12 months the FTC should be fully transformed into a commercially run organisation with the four distinct business units mentioned earlier. The consulting company is also assisting the FTC to improve its financial performance and re-engineer its business processes. The MIPT is in the process of readying itself for the setting up of a Communications Authority to regulate the sector. It is being assisted by an experienced regulator to come up with an organisational structure and elaboration of the functions of the authority. As soon as the Communications Bill is made into law the recruitment process for the Communications Authority will commence. Some of the regulatory functions have already been carried out by the Technical Committee set up by MIPT to oversee the awarding of the licence for the second cellular operator, in line with the Government’s aim of liberalising this sector. There is now the prospect of three competitors in the Cellular field, i.e. Net*One, Econet and Telecel. Partial privatisation will be pursued as a logical next step, following the commercialisation of the PTC. The fixed telecommunications business and the cellular business lend themselves well to early partial privatisation. There is a need to inject private sector funding in these businesses to sustain growth and survive the onslaught of competition. This will be done by acquiring a strategic partner and involving local investors in the initial sale of equity. The estimates for the fixed telecommunications network are that it will grow to 580,000 in five years under the current projects; and the cellular service spurred on by competition may grow within the same period to about two thirds of the fixed network, i.e. 400,000 mobile customers shared among the three network operators. The postal operation will not be privatised for the foreseeable future. There is a need to expand this service so that rural areas get much better access to it. However, the postal operation is expected to become more profitable, so that it can sustain itself without the need for subsidies. This will be achieved through commercialisation, better tariff treatment, and the introduction of new innovative services. By the year 2003 postal outlets are expected to increase from the current 289 outlets to 393 outlets. This will improve the postal density from 43,000 to 37,000 people per outlet. However, this is still far short of the long-term target of 20,000 per outlet. Conclusion Billions of dollars will have to be invested in the Postal and Telecommunications sector if Zimbabwe is to remain competitive in the global village. My vision is of a Zimbabwe with a robust and pervasive communications infrastructure that will be part of the Global Information Infrastructure. Zimbabwe citizens will be able to enjoy the use of a modern, high quality infrastructure, offering a multitude of services on the Global Information Infrastructure. A lesser vision would mean oblivion in the next millennium.
