Plans by Libya's Lap Green Network to use Zambia as a stepping stone for further investment in the Southern African region have suffered a major setback following the decision by the Zambian government to reverse the sale of Zesco's fiber-optic network.
The nationwide fiber was owned by the Zambia Electricity Supply Corp. (Zesco), a government-run power utility company, but was sold together with Zamtel to Lap Green Networks last year by the previous Zambian government.
However, the new Zambian government has now reversed the sale of the fiber network to Lap Green, frustrating the company's plans to connect the fiber network to countries in the region including Botswana, Namibia and the Democratic Republic of Congo (DRC).
Zesco has complained that it was politically pressured to sell the fiber network to Lap Green Network together with Zamtel in order to raise the value of Zamtel.
Zambia's new president, Michael Sata, who has been in office for less than two months, has constituted a Commission of Inquiry to look into how Zamtel was sold at US$257 million by the previous government. The previous government claimed that the company was on the verge of collapsing because it was not making a profit.
The director of Zesco's Kafue George hydro-electric project, Christopher Mubemba, told the Commission of Inquiry that Zesco was pressured by the previous government to sell 80 percent of the fiber-optic network to Zamtel in order to make the telecom company attractive to Lap Green.
Mubemba said Zamtel had not yet paid anything for the fiber-optic network.
"It was a big mistake to [sell] the optic fiber network, which is supposed to be used to develop the country's communication system. I therefore direct that the fiber network be given back to Zesco," said the new minister of Lands, Energy and Water Development, Christopher Yaluma, after touring Zesco last week. He ordered the sale of the fiber network to be reversed.
The move is a serious setback for Lap Green Network, which wanted to sell capacity to neighboring DRC, Namibia and Botswana as part of the company's expansion plans.
The Zesco optic fiber, designed to service mobile, fixed and Internet communications, covers 4,000 kilometers across the country and connects most provincial centers.
President Sata claims the entire Zamtel sale was dubious and wants the Commission of Inquiry to determine whether the sale of the company should also be reversed. Sata claims the 70 percent controlling stake sold to Lap Green Network should have been sold to Zambians in order to empower them and allow them to have ownership of the company.