A senior official within Zambia’s government has confirmed that Libya’s LapGreen Networks has threatened to seize the country’s international assets because the southern African country has failed to settle a debt of US$380-million it owes the company.
Speaking to ITWeb Africa on condition of anonymity, the official said: “The company has already engaged the World Bank, the International Monetary Fund, the Southern African Development Bank, the African Development Bank and rating agencies – including Moody’s Investor Services – over the matter and now the country’s international assets are being targeted because the government has failed to honour its obligation.”
The debt dates back to 2012 when Zambian authorities nationalised Zamtel, a year after LapGreen Networks bought the company from the previous Zambia administration for US$252-million.
However, the new administration – through the then Justice minister Sebastian Zulu – disputed the sale of Zamtel to LapGreen Networks and claimed the previous administration had acted “with extreme haste” as it did not follow normal tender procedures, hence rendering the transaction illegal.
Thereafter, the new administration forcibly took over Zamtel’s operations from LapGreen Networks insisting that the 75% shares the company owned were corruptly sold by the previous administration.
LapGreen Networks denied any wrongdoing in the manner it acquired the company and subsequently took the matter to the Zambian High Court where the government failed to defend its decision to repossess the company.
The government has failed to make public the report of a Commission of inquiry, constituted by the late President Michael Sata, to investigate how Zamtel was sold to the Libyans.
Instead, officials decided to enter a consent judgment to compensate LapGreen Networks on its initial investment in Zamtel of US$252-million plus interest, calculated at 8% and other charges.
According to the settlement agreement, the government was supposed to make an initial payment of US$114-million in November 2016, followed by biannual payments of US$35-million in February 2017 and August 2017 respectively.
Last week, online media organisations in Zambia quoted Dr Faisel Gergab, chairman of the Libyan Post Telecommunications and Information Technology Company, a holding company that manages Libya’s telecom assets, as saying, “the company had found itself forced to assess other options including grabbing Zambia’s international assets to claim the debt the country owes.”
Zambia’s minister of Communications and Transport Mutotwe Kafwaya did not respond to a media inquiry on the matter.TelecomsICT and GovernanceLapGreen NetworksZamtelDr. Faisel GergabMutotwe KafwayaMichael Sata