Wednesday, February 28, 2018


Swaziland’s Prime Minister Barnabas Dlamini stands to be paid E150,000 (US$13,000) from a company that has shares in controversial cell phone company MTN Swaziland.

Dlamini in his recently-published autobiography claimed to own 0.1 percent of the investment holding company Swaziland Empowerment Limited (SEL) which has 19 percent shares at MTN Swaziland, the Sunday Observer newspaper in Swaziland reported (25 February 2018).

The Observer calculated the Prime Minister was expected to get an estimated E23,856, before taxes this financial year. It estimated the PM, who is not elected but appointed by absolute monarch King Mswati III, had been paid ‘about E150,000 in total since March 2016’.

In Swaziland seven in ten of the population live in abject poverty with incomes less than E23 per day.

Until July 2017 when Swazi Mobile launched, MTN was a monopoly provider of cell phone services in the kingdom.

King Mswati is a major shareholder in MTN Swaziland. The Sunday Times in Johannesburg reported in July 2014 he holds 10 percent of the shares and is referred to by the company as an ‘esteemed shareholder’. It said MTN had paid E114 million (US$11.4 million at the then exchange rate) to the King over the previous five years. 

The Sunday Times reported that at the time MTN had a monopoly in Swaziland and was used by 57 percent of the population. It said MTN was able to keep prices high, citing the cost of 300 megabytes of data in Swaziland as E149, while in South Africa the same amount of data cost E79.

Prime Minister Dlamini’s holdings in SEL have been a matter of controversy for years. As long ago as 2011, Musa Holphe, a human rights campaigner and journalist, highlighted that Dlamini’s holdings in MTN might be a conflict of interest since he was also a key decision maker in the affairs of MTN’s only rival for telephone services, the parastatal, Swaziland Posts and Telecommunications Corporation (SPTC).

Writing in the Times Sunday, a newspaper in Swaziland, (26 September 2011), Holphe said, ‘Since SEL’s main, if not its only, investment is MTN Swaziland it is important to understand that the value of the SEL shares will be slashed if anything happens that affects MTN’s profitability.

‘This government has been at the centre of many decisions that affect the ability of SPTC to properly compete with MTN. 

‘Each government decision seems designed to hamper SPTC and enable MTN to continue its monopoly and unfairly increase the wealth of its shareholders which as we now know includes the private wealth of the prime minister. 

‘It is shocking to see how much money is generated by MTN and that, in spite of the grinding poverty of the majority of us; vast riches are still secretly flowing into the pockets of the elite.’

He added, ‘He may say that it is all perfectly legal but that is the wrong test. Compliance with the law is a minimum standard not a maximum. 

‘Leaders must be held to higher standards. Even if what the PM does is perfectly legal, we should still be asking, is it honourable, decent and wise? Is it moral? 

He added, ‘Corruption is like pregnancy – you cannot be a little bit pregnant and you cannot be a little corrupt. You either are or you are not. It is time to tackle corruption properly and declare all interests openly. Ministers with interests must excuse themselves from any decision-making that affects those interests not just the major ones.’

In 2009, Earl Irvine, then US Ambassador to Swaziland, wrote a confidential cable (later published by Wikileaks) in which he said the King operated in his own financial interest. Part of the cable said, ‘Royal politics and King Mswati’s business interests appear to have caused the ouster of Mobile Telephone Network (MTN) CEO Tebogo Mogapi and halted parastatal Swaziland Post and Telecommunications Corporation (SPTC) from selling the MTN shares it owns to raise money for a Next Generation Networks (NGN) cell phone project. 

‘Industry and press observers privately indicated that the King, who already owns many MTN shares, had wanted to purchase the MTN shares himself at a cheaper price than the buyer, MTN, was offering SPTC. 

‘Government officials later prevented the sale, and recently did not renew the work permit for CEO Mogapi, a South African citizen, apparently in retaliation for his role in the transaction, as well as the CEO’s reported decision to oppose government efforts to use the MTN network for electronic surveillance on political dissidents.’

The cable went on, ‘The government’s halt of parastatal SPTC’s sale of MTN shares demonstrates the impact the King’s and other influential individuals’ private business interests can have on business transactions in Swaziland. 

‘Government officials would likely prefer a more malleable Swazi CEO at MTN who would cooperate more fully with royal and government wishes.’

A research article written by Ewan Sutherland of the University of the Witwatersrand, Johannesburg, South Africa, and published in December 2014 in the Communicatio academic journal, explored telecommunications in Swaziland and concluded there was no competition for mobile phones in the kingdom and ‘the monarch and his cronies are financially tied to Swazi MTN, seeking to neuter the state-owned SPTC. The government has no concern for consumers, service delivery or economic growth, with the King and his prime minister looking after their personal financial interests.’

Sutherland wrote, ‘[I]t is difficult to see how any investor could have confidence, unless it had the sovereign on their side and, more likely, in their pocket. 

‘The monarch has a significant and lucrative investment in the principal operator, with the effect of confusing and confounding an already feeble system of governance. The opaque profit-seeking of the King conflicts with the purported aspiration to good governance of telecommunications markets and the interests of his subjects. In a constitutional monarchy, arrangements can be made to keep the investments of a monarch separate from politics, allowing for transparency, accountability to parliament and the avoidance of interference with governance (e.g., Japan and the Netherlands).

‘A feudal monarchy knows no such distinction, there are no conflicts of interest for ministers, regulators and directors – they obey their king. It echoes the problems of Morocco, where its king has private interests in telecommunications, has ministers sit on the supervisory board of the state-owned operator, and he appoints the regulator and is head of the judiciary.’

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