Zimbabwe telecom operators want higher tariffs

By Staff reporter | 05 Apr 2019 at 17:21hrs
Spectrum
Zimbabwe's telecom operators are pushing for tariffs to be at least $0.40 per minute from the current $0.22 per minute despite a recent review, Business Times reported.

If the operators get their way, communication costs for Zimbabweans will spike further and push business costs up. Already, data costs have been adjusted to match the new exchange rates.

In recent weeks, the operators have been up in arms with the industry regulator, POTRAZ (the Postal and Telecommunications Regulatory Authority of Zimbabwe), with a view to increasing tariffs to levels they felt reflected not only their operating costs but also the prevailing RTGS/US dollar exchange.

Last week, POTRAZ allowed the operators to increase their tariffs but they are still not happy with the level, which they say falls far short of their proposed tariffs.

In the absence of concessions in respect of forex allocation for critical imports, the industry fears a collapse as the operators say they have not been able to import new equipment and spares since 2016.

Telecel says operational costs remain a worry under the current tariff regime. "The approved tariffs are not fully reflective of the movement of current operational costs," says Telecel.

Questions sent to Econet were not responded to at the time of going to press, while efforts to get a comment from NetOne were also fruitless.

A POTRAZ fourth-quarter 2018 report shows a 41% decline in annual capital expenditure by mobile operators on an annual comparison that records $59.53m in 2018 from $100.85m in 2017.

On a quarterly basis, capital expenditure by mobile operators grew by 199.8% to record $29.50m in the fourth-quarter 2018, from $9.84m in the previous quarter.

Revenues for mobile networks slid on a quarterly basis by 13.3% to $287m while operating costs went up 5% to $174.8m.

However, the annual comparison shows that mobile network revenues increased by 36% to record $1.16bn in 2018, from $849.88m in 2017, while operating costs grew by 25.3% to $660.60m in 2018, from $527.35m recorded in 2017.

The report also shows fixed network operating costs increased by 9.4% in the quarter under review. An annual comparison shows that fixed network revenues increased by 16.2% to record $135.42m in 2018, from $116.57m in 2017. Investment declined significantly by 61.2% to record $22.41m, from $57.78m in 2017.

The billion-dollar-a-year telecoms industry has been closely monitoring foreign currency allocations to importers by the central bank after crucial Monetary Policy interventions in February, with a view to increase tariffs in the event the new measures fail to address shortages of hard currency.

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