South Africa plans telecom privatization

The South African minister of public enterprises has announced a sweeping plan to privatize state-owned companies, including telecommunications.

Economists and black empowerment leaders in Africa have hailed the recent decision, which also covers energy and transportation companies.

The plan will be fully under way this year and is expected to include privatization of telephone giant Telkom Ltd., according to Jeff Radebe, minister of public enterprises. Consolidation of Sentech (broadcasting signal corporation), Transtel (transport corporation) and Eskom (electricity supply corporation) might be useful to create a second national telecommunications corporation, he said. The consolidation would top new technology and investments enabling the country to operate telecommunications via traditional electric cables.

An office has been set up to coordinate IPOs (initial public offerings) for the state-owned companies. Telkom will be the first company to go public. The government hopes to raise more than US$6 billion from the Telkom IPO, expected by the end of this year.