Parliament approves NetOne loan Minister Chinamasa
Minister Patrick Chinamasa

Minister Patrick Chinamasa

Zvamaida Murwira Harare Bureau
THE National Assembly yesterday approved a $218 million loan for NetOne infrastructure development that was signed between Zimbabwe and China during a trip in which President Mugabe signed several infrastructural deals.
Finance and Economic Development Minister Patrick Chinamasa said the loan would help NetOne increase the number of its towers from the current 500 to 1,000.

The loan was advanced by Export-Import Bank of China and signed on August 25, 2014 in Beijing.

Minister Chinamasa defended the loan together with management at NetOne led by its managing director, Reward Kangai, for doing a sterling job under difficult circumstances.

This was after legislators, particularly from the MDC-T, said while they supported the motion to have NetOne secure the loan, they had reservations on the management team which they said had failed.

The legislators said Kangai had failed to turn around the fortunes of NetOne, a situation which had seen it being surpassed by its competitors, Econet and Telecel, despite it being the first to provide mobile services.

It was also noted that NetOne was one of many state entities that had failed to declare dividends since its inception.

Legislators demanded management efficiency.

But Minister Chinamasa said NetOne’s challenges were mainly as a result of undercapitalisation and not poor management as alleged.

“I have raised these issues, why have they not declared a dividend. The quick answer I got is that what have you given us to grow. We must give Kangai credit for growing this company from nothing,” said Minister Chinamasa.

He said while Econet and Telecel looked at profitability in deciding their coverage, NetOne had a social responsibility to ensure that villagers in rural areas had access to mobile services.

He said government bureaucracy had also affected NetOne as other two mobile service providers only needed one board meeting to conclude a deal while NetOne needed approval from its parent Ministry, which would in some instances be relayed to Treasury for further concurrence.

This, said Minister Chinamasa, delayed decision making that could cost it, particularly considering that technology was dynamic.

On sharing of infrastructure, Minister Chinamasa said government was considering coming up with one entity that would lease out equipment so that mobile firms merely compete on service delivery.

 

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