Zimbabwe’s telecoms giant to diversify into construction

Zimbabwe telecommunications giant, Econet Wireless, is diversifying into road construction, as it seeks to bail out government on its ambitious economic plan, the Zimbabwe Agenda for Sustainable Social Transformation (ZimAsset).  Chief executive officer, Douglas Mboweni says the latest expansion drive was reached after noting that many communities were hard to reach because of poor roads.

Mboweni says since Zimbabwe was sitting on fiber network of approximately 7 200 kilometers, poor road network was preventing them reaching most outlying areas.  This, he said, was a threat to the growth of the company, while branching into road construction would also broaden the company’s foot print.

Mboweni stated, “It’s been articulated by the government that all private players should participate in driving the four economic pillars including food security, social services, value addition and infrastructure development as outlined in ZimAsset.”  Furthermore, he added, “Road maintenance has been so low on government’s priority scale in the past three decades that most roads are well past their useful lifespan and need complete reconstruction.”

The mobile operator has contributed more than $900 million in taxes, duties and levies since 2009.  Last week, it posted upward revenue of eight percent to $752.7 million, largely driven by the growth in data and Ecocash, a mobile money transfer platform. However, voice services income was flat despite adding 780,000 new subscribers during the year.

Recently, the Poverty Reduction and Economic Management Unit painted a gloomy picture of Zimbabwe’s capacity to rehabilitate its dilapidated infrastructure, saying it would take more than 112 years for the government to rehabilitate its road network given the meager resources allocated each year towards refurbishment of roads.

The regional research unit also said government would need at least $1.15 billion over 10 years to rehabilitate the largely vandalized railway system.  Part of the report read: “The current budget allocation means that it will take more than 112 years to rehabilitate all the roads as envisaged by the government, an impossible task because the rate of road damage will always be higher than that of rehabilitation”.