HomeBusiness DigestMasiyiwa challenges Nepad

Masiyiwa challenges Nepad

Ngoni Chanakira

TELECOMMUNICATIONS and media mogul Strive Masiyiwa, who recently tightened his grip on Econet Wireless Holdings Ltd (Econet) to 60%, says the New Partnership for Africa’s

Development (Nepad) is a waste of time if it is not used to benefit and protect all Africans.

Masiyiwa is battling for control over the Nigerian cellphone operator Econet Nigeria, where South Africa’s Vodacom is facing legal action from Econet Wireless International for allegedly enticing the Nigerian operator to engage in a breach of contract.

“Nepad is a waste of time if it cannot protect Africans interested in developing the continent to become self-sufficient,” Masiyiwa said on Monday in a question and answer session with the Voice of America’s Studio 7.

“Why do Africans become jealous when their brothers want to invest in their countries? They should, instead, try to help them.”

Masiyiwa last month increased his stake in Econet (Zimbabwe) but is fighting a battle in which he intends to spread his telecommunications empire to Nigeria – regarded as Africa’s largest and most lucrative cellular market.

He seems to have hit a brick wall there as there is strong resistance from government and business tycoons in that country.

South Africa’s Vodacom has made a bid to buy a stake of 50% plus one share in Econet Nigeria, in a deal that has theoretically been accepted by the cash-strapped Nigerian company.

But as a 5% stakeholder in the Nigerian operations, SA-based Econet Wireless International claims to have pre-emptive rights to buy any shares that come onto the market.

“Vodacom are not playing the game on the same playing field,” Masiyiwa said. “We have now had to resort to court action to try and settle the issue. I think it is unfair.”

Masiyiwa has now had to file an application against Vodacom in Nigeria’s High Court alleging that the company has engaged in actions to “induce a breach of contract and bad business practice”.

Ironically South Africa’s President Thabo Mbeki and Nigerian President Olesugun Obasanjo coined Nepad and Masiyiwa’s battle could be a test case for the ambitious African partnership.

The businessman intends to spread his telecommunications empire to Botswana, South Africa, Lesotho, Kenya, Nigeria and Zimbabwe.

Mbeki told a special session of the United Nations (UN) General Assembly held in New York that Nepad was designed to “radically” alter the paradigm that informed international African development programmes.

“To indicate that change, we reaffirm that we, the Africans, are the architects of the Nepad renewal plan,” he said. “As Africans, we now own Africa’s development agenda.”

The South African head of state also confronted the perception that Nepad was nothing more than a begging bowl extended by Africans to the western world.

“We seek to ensure that we move away from the donor-recipient relationship with the developed world, to a new partnership based on mutual respect as well as shared responsibility and accountability,” Mbeki told the UN.

Masiyiwa, however, said if Nepad could not protect businessmen like himself who were genuinely trying to empower Africans it was useless.

Nepad, viewed with suspicion by Zimbabwe and some states within the African continent, has been under fire from sections of the civil society in South Africa, particularly the labour federation, the Congress of South African Trade Unions (Cosatu) which complains that the plan was developed without the participation of the masses.

Others have sought to dismiss it as another form of structural adjustment programme.

Zimbabwe’s ambassador to Washington, Simbi Mubako, taking his cue from President Robert Mugabe, warned that Nepad would become an instrument of African division and conflict if western countries were given a major role to play in it.

Mubako told the UN that the conditions of democracy and good governance imposed by rich nations in return for their support for the programme should be dropped because no such demands were made during Europe’s reconstruction after the Second World War.

The founding secretary general of the Joshua Nkomo-endorsed Indigenous Business Development Centre (IBDC) Masiyiwa is no stranger to the courts.

He fought a lengthy and costly battle against the then Minister of Information, Posts and Telecommunications Joyce Mujuru, for his Zimbabwe operating licence.

In Zimbabwe, while not being there physically, Masiyiwa is in court again, this time for the licensing of his media empire, Associated Newspapers of Zimbabwe (Pvt) Ltd, publishers of the Daily News and the Daily News on Sunday.

The two publications were taken off the street on September 12 after having been deemed illegal by government.

The business tycoon took firm control of the ANZ after the publishing company offered him and a team of indigenous players a major shareholding after facing financial problems and failing to service escalating debts to creditors.

In an interview before he departed for South Africa, Masiyiwa confirmed that the late vice president Nkomo had to intervene for Econet to be issued with an operating licence.

Meanwhile, in its results for the full year ended June 30 Econet’s basic earnings per share shot up 640% from $1,18 to $8,76. Analysts said this was a notable increase considering that the group had been unable to increase tariffs due to regulatory control by government.

The group is now lobbying for tariffs of US$0,20 a minute in line with regional tariffs. At the moment Econet is only able to charge US$0,01 a minute.

At a recent Extraordinary General Meeting Econet shareholders approved the Mascom Botswana deal with the only amendment being the adjustment in the number of issued Class A ordinary shares from 918 705 438 to 739 843 680. Mascom is Botswana’s premier mobile operator.

Using his companies TS Masiyiwa Investments (Pvt) Ltd (SMI) and Dunstone Investments (Pvt) Ltd, Masiyiwa will now own 60% of Econet’s shareholding, down from the proposed 64,1% he wanted.

Dunstone and SMI are companies owned by trusts set up for the benefit of Masiyiwa and his family.

Masiyiwa’s shareholding now stands at more than 224 million shares, currently valued at $62 each.

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