The government of Zimbabwe and its parastatals owes state-owned telecommunication company, TelOne ZWL$ 945 million in outstanding payments for services rendered, and this has had adverse impact on the parastatal’s cash flows and operations.
According to TelOne Status Update report to the Ministry of Information and Communication Technology (ICT), the company’s total debtor’s book has reached ZWL$1.58 billion, as of 31 March 2021.
This makes government and parastatals’ debts to Telone constitute over 60 percent of the company’s total debtor’s book.
“This has constrained the company’s cash flows and operations to the extent that TelOne is in turn facing difficulty in setting its key service providers and statutory obligations,” reads the report.
Of the ZWL$ 945 million, Government of Zimbabwe owed ZWL$ 799 million while Parastatals and State Owned Enterprises accounted for ZWL$ 146 million.
TelOne has lagged behind in modern technology deployment compared to its competitors in the ICT sector who have made headways into digital space.
Failure by government (as the biggest debtor) to meets its obligations with the telecommunications firm saw TelOne penalized US$8,9 million by the Zimbabwe Revenue Authority (ZIMRA) for late settlement of its tax obligations in 2018.
Now, the company requires an additional US$ 25 million annually, for the next five years to be invested in the network to ensure a digitally enabled society.
“It (TelOne) needs to deploy more infrastructure that reach new outlying areas including rural areas, more people and businesses in the country through fibre and wireless connectivity,” reads the report.
It has since requested for increased foreign currency allocations on the foreign currency auction system to US$ 500 000 per week to capacitate funding of planned projects
“Telone has submitted a total of US$ 11,469,997 bids through the Foreign Currency Auction Floor since its introduction in June 2020. Bids of only US$ 6,377, 393 have been awarded which translates to 56 percent of the total bids submitted. US$5,456,969 has been disbursed leaving a balance of US$ 920,423 yet to be released by RBZ,” said TelOne.
