Emmerson Njanjamangezi, Group Features Editor 
STATE-owned fixed line operator, TelOne, says it requires capitalisation of at least US$125 million over the next five years to upgrade its network and be more competitive.
TelOne managing director Chipo Mtasa
According to a report submitted to Parliament and the ministry of ICT by TelOne, the current equipment has become obsolete and is in urgent need of replacement.
“The company requires an additional US$25 million annually for the next five years to ensure a digitally enabled society,” part of the report reads.
But the firm continues to be weighed down by debts totalling $1,58 billion as at March 2021, making it difficult to attract financing. The government of Zimbabwe owes $799 million while parastatals and state-owned enterprises account for $146 million.
“This has constrained the company’s cash flows and operations to the extent that TelOne is facing difficulties in settling its key service providers and statutory obligations.”
The telco, inherited debt from its predecessor company, PTC, which has ballooned to $432 million, attracting exchange losses amounting to $32 billion as of December 31 2020.
“The ministry of Finance and Economic Development, through the Debt Management Office, is currently engaging correspondent lenders to get their buy in on the warehousing of these loans.”
“TelOne’s balance sheet remains unattractive due to the exchange losses arising out of legacy debts, which make it difficult to access facilities for network expansion.”
The firm is currently pushing for investments in broadband connectivity and targets to reach a milestone of 300 000 homes by 2025.
Just last week, TelOne ran a notice in the Government Gazette inviting suitors for the funding and deployment of its wireless broadband project under private or public partnerships (PPPs).
According to the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz)’s abridged sector performance report for the fourth quarter 2020, the total number of fixed telephone lines declined by 1,7 percent to 252 067 as at December 31, 2020, from 256 356 recorded as at September 30, 2020.
For the period, fixed network revenue grew by 41,7 percent, whereas operating costs grew by a higher margin of 76,1 percent. The growth in revenue, according to Potraz, is attributable to an increase in usage traffic. The revenue contribution of Internet and data to total fixed telephone revenue increased, whereas the contribution of voice service declined.
