INFORMATION AND COMMUNICATIONS TECHNOLOGY (ICT): AN
ANALYSIS OF ZAMBIA’S ICT POLICY INITIATIVES AND THE ROLE OF
MULTILATERAL ORGANIZATIONS
A dissertation presented to
the faculty of
the Scripps College of Communication of Ohio University
In partial fulfillment
of the requirements for the degree
Doctor of Philosophy
Musonda Kapatamoyo
June 2007
This dissertation entitled
INFORMATION AND COMMUNICATIONS TECHNOLOGY (ICT): AN
ANALYSIS OF ZAMBIA’S ICT POLICY INITIATIVES AND THE ROLE OF
MULTILATERAL ORGANIZATIONS
by
MUSONDA KAPATAMOYO
has been approved for
the School of Telecommunications
and the Scripps College of Communication by
Don M. Flournoy
Professor of Telecommunications
Gregory J. Shepherd
Dean, Scripps College of Communication.
Abstract
MUSONDA KAPATAMOYO, Ph.D, June 2007, Mass Communication
INFORMATION AND COMMUNICATIONS TECHNOLOGY (ICT): AN
ANALYSIS OF ZAMBIA’S ICT POLICY INITIATIVES AND THE ROLE OF
MULTILATERAL ORGANIZATIONS (254 pp.)
Director of Dissertation: Don M. Flournoy
This study analyzed the role of Multilateral Organizations in
Zambia’s preparation of an Information and Communication
Technology (ICT) policy. The research used the qualitative research
and secondary analysis methods to gather, analyze and discuss
findings. It used the political economy theoretical framework,
emphasizing paradigmic approaches of modernization, dependency
and globalization to explore the levels of influence from Multilateral
Organizations. The study revealed that Multilateral Organizations,
which included the World Bank, World Trade Organization, Southern
African Development Community and Common Market for Eastern and
Southern Africa, influenced the Zambian ICT policy process through
three mechanisms: they developed protocols and guidelines which
Zambia incorporated into its ICT policy; set benchmarks and targets
which Zambia was obligated to implement within a specific time frame;
and utilized behavioral and resource power to extract binding
commitments from the Zambian leadership involved in the policy- making process.
Approved: ______
Don M. Flournoy
Professor, School of Telecommunications
Acknowledgements
This dissertation, while authored by me, is really a collaborative effort of many. I owe the completion of this dissertation to my dissertation chair and mentor, Professor Don M. Flournoy. For your guidance, kindness and generosity, I am forever grateful. You are indeed a great teacher and model of outstanding academic advising.
Your unceasing availability and apt communication, in the midst of your other professional obligations made my academic journey an enjoyable experience despite the challenges I faced. Thank you for meticulously editing my dissertation, your constructive criticism, and regular feedback.
I do appreciate the guidance and scholarly input I received from
Professor Phyllis Bernt, Professor Greg Newton and Professor Jim
Mosher all of whom played a key role in my committee. Thank you for widening my scope of understanding by challenging me academically.
My heartfelt thanks go to my most loving, caring, tolerant and patient family. To my parents Gershom Pule and Margaret Mulenga
Kapatamoyo, all those years without me at home when you needed to see me, have finally come to pass. My one and only brother, Mutale and my beloved sisters Chama-Maudy, Chama-Margaret, Kombe-
Mercy, Momo and Kombe, thank you for the support you gave me
when I was far away from you. My grandmother, Sabina Kafitisha, and
late grandfather, John Chishala Kafitisha, you have always been my
stars and I thank you for believing in me. Your words of wisdom have
not landed on deaf ears. To my adopted parents Mr. Chivwara and
Mrs. Felistus Phiri, who treated me like their own son, I thank you for your generous support. Ms. Susan Mulikita and Mr. Victor Mbumwae of the Communications Authority of Zambia and Ministry of
Communications and Transport respectively, I applaud you both for your input and insights that have made this dissertation a worthy document for our shared country. Your help can certainly not be overemphasized. Mr. Erek Perry, the first Assistant to President for
Diversity, and Mr. Sylvester James Aji, I want to thank you from the bottom of my heart for your support, for believing in me and giving me
a job which I have performed for six years while completing this doctorate. Without this cushy job my life would have been unbearable.
To all my professors, friends, and colleagues who helped in this
dissertation and whose names I may have unintentionally omitted, I
owe you a great deal. I thank you all.
Dedication
This dissertation is dedicated to my family, especially Mumba
Mumba and Mulenga. You showed me remarkable commitment, support, tolerance and love during my academic journey and long absences from home. I am forever proud of you because you represented the terra firma which provided a unique strength and motivation for me to focus on this project. We suffered together through lean times and came out strong. I therefore remain gratefully indebted to you both.
I also dedicate this work to my grandfather Mr. John Chishala
Kafitisha who taught me how to read and write at a very young age.
You passed away when I was just about to complete my hardest project and never reaped any benefit from your hard work and love.
viii Table of Contents
Page
Abstract ...... iii Acknowledgements ...... v Dedication ...... vii List of Tables...... xi List of Figures...... xii Chapter One - Introduction ...... 1 Geopolitical Situation of Zambia ...... 1 Background of the Study...... 4 Definition of Terms...... 22 Information and Communication Technologies (ICTs) ...... 22 ICT Convergence...... 27 Liberalization, Deregulation and Privatization...... 30 Social and Economic Benefits of ICTs ...... 31 Policy Process ...... 37 Theoretical Perspectives...... 38 Purpose of the Study ...... 39 Research Questions ...... 39 Overview of Chapters ...... 41 Chapter Two – Literature Review...... 43 Introduction ...... 43 Historical Context of Policy Reforms ...... 45 New Technologies for Development ...... 53 From Nationalization to Privatization ...... 60 Multilateral Organizations and Domestic Policy ...... 65 Technology Determinism ...... 67 ICTs and Social Context ...... 70 Comparative Country Analysis...... 73 Nigeria...... 74 History of Nigerian Telecommunications...... 75 Development Planning in Nigeria...... 76 Regulation of Telecommunications in Nigeria ...... 78 Structure of Nigeria’s Telecommunications Sector ...... 81 Other Players in Nigeria ...... 82 Mozambique ...... 83 History of Mozambican Telecommunications ...... 85 Development Planning in Mozambique ...... 86 Regulation of Mozambican Telecommunications ...... 87 Structure of the Mozambican Telecommunications Sector ...... 89 Other Players and Partners in Mozambique...... 90 ix Chapter Three – Theoretical Framework ...... 93 Communications Research and Political Economy Paradigms ...... 93 Theoretical Perspectives...... 94 Political Economic Paradigms...... 94 Modernization Paradigm ...... 95 Globalization...... 103 Chapter Four – Research Objectives and Methodology...... 106 Research Objectives ...... 106 Research Procedures ...... 107 Data Sources and Collection ...... 109 Research Population and Sample ...... 110 Data Analysis ...... 111 Limitations and Exclusions...... 111 Chapter Five – The Policy Process and Technology Options ...... 113 Introduction ...... 113 Rationale for Reform...... 117 History of Zambian Telecommunications...... 121 The Regulatory Framework...... 123 Organization of the Communications Authority of Zambia ...... 130 Regulatory Functions of the Communications Authority of Zambia133 Telecommunications License Operating Fees ...... 135 Spectrum Management ...... 137 Technology and Infrastructure ...... 138 Public Switched Telephone Network (PSTN)...... 139 International Gateway...... 140 Internet ...... 141 Very Small Aperture Terminals (VSAT) ...... 144 Mobile Telephony ...... 145 Fiber Optics ...... 148 Satellite ...... 150 Chapter Six – Multilateral Organizations and Domestic Policy ...... 155 Introduction ...... 155 How MOs Influenced the ICT Policy Process...... 159 The World Trade Organization (WTO)...... 162 Global Protocols ...... 163 Persuaded Obligation ...... 164 Criticism of the WTO ...... 166 The World Bank ...... 168 ICT Convergence...... 169 Persuaded Obligation ...... 173 International Monetary Fund (IMF) ...... 175 Regional MOs ...... 177 Common Market for Eastern and Southern Africa (COMESA)...... 180 x COMESA ICT Agenda...... 183 Southern Africa Development Community (SADC)...... 185 The NEPAD e-Africa Commission ...... 187 Chapter Seven - Discussions and Conclusions ...... 189 Introduction ...... 189 Policy Objectives and Priorities...... 192 Organizations Involved in the Policy Process ...... 195 Formulation and Implementation of the ICT Policy ...... 200 Concerns about the ICT Policy and Process ...... 203 Government Issues...... 204 Multilateral Organizations Issues ...... 207 Regulatory Issues...... 209 Technology Issues ...... 211 Implications of Policies on ICT Sectors ...... 212 Economic Implications...... 215 Technological Implications ...... 216 Recommendations for Future Study ...... 217 References...... 219 Appendix A - Acronyms...... 236 Appendix B - Important Milestones in the Development of Telecommunications in Zambia ...... 239 Appendix C: Three Types of Telecommunications Licenses Issued by CAZ ...... 241 Appendix E - Policy Based Loans from Multilateral Organizations.... 245 Appendix F - Chronology of IMF Programs 1973-2003 ...... 247 Appendix G - Chronology of World Bank Programs...... 249 Appendix H – WTO Tariff-reduction Timetable and Product Coverage ...... 250
xi
List of Tables Page
1.1 Basic Socio-Economic Data about Zambia………………………………. 15
1.2 Internet, Broadband Services and International Bandwidth indicators………………………………………………………………………………….. 18
1.3 ITU Teledensity Report of SADC and COMESA Countries………. 33
2.1 Speeds and Cost of Communication Technology……………………. 55
5.1 Regulation of Legacy Systems…………………………………………………. 126
5.2 National Newspapers in Zambia………………………………………………. 130
5.3 Functions of the Communications Authority of Zambia…………. 134
5.4 Three Types of Telecommunications Licenses Issued by CAZ… 137
6.1 Fundamental Principles Enshrined in the COMESA Treaty……… 182
xii List of Figures Page
1.1 Map of Zambia………………………………………………………………………….. 13
1.2 Three Core Pillars of the WB ICT Strategy for Regional Integration and Connectivity in Sub-Saharan Africa………………. 22
1.3 Relationship between ICT Policy and other Areas of Development……………………………………………………………………………. 25
1.4 Key Agents in Policy-making Processes…………………………………… 26
1.5 Regulatory Bodies in Africa in 2003……………………………………….. 32
2.1 Organization Chart of State Participation in the Economic Affairs of Zambia from 1968 to 1990………………………………………. 63
2.2 The Organization of the Telecommunications Sector in Nigeria………………………………………………………………………………………. 82
2.3 The Organization of the Telecommunications Sector in Mozambique……………………………………………………………………………… 90
5.1 Mobile and Fixed Telephony Expansion, 1996 – 2000……………. 117
5.2 Telecommunications and Broadcasting Legislation…………………. 120
5.3 The Organization of the Telecommunications Sector in Zambia………………………………………………………………………………………. 133
5.4 UNZANET’s International Connections…………………………………….. 143
5.5 VSAT Uplink and Downlink………………………………………………………. 147
5.6 GEO Satellite Footprint in Zambia...... 152
7.1 Key Agents in Zambia’s ICT Policy Formulation Process………… 200 1
Chapter One - Introduction
Geopolitical Situation of Zambia
Figure 1.1 - Map of Zambia
Source: CIA, 2006
Zambia is a landlocked country located in the southern region of
Africa. It is surrounded by eight countries: Angola to the west,
Botswana, Zimbabwe and Namibia to the south, Malawi and
Mozambique to the east and Congo (the Democratic Republic) and
Tanzania to the north. It has 752,614 square kilometers (sq km) of territory whose borders are as follows: Angola 1,110 km, Democratic
Republic of the Congo 1,930 km, Malawi 837 km, Mozambique 419 2 km, Namibia 233 km, Tanzania 338 km, and Zimbabwe 797 km. The
population of Zambia is nearly 11 million people comprising 50.8%
females and 49.2% males. There are approximately seventy-two
dialects spoken across the country out of the seven main languages,
namely: Bemba, Kaonde, Lozi, Lunda, Luvale, Nyanja and Tonga
(Zambia Central Statistical Office, 2002; CIA, 2006).
The economy of Zambia relies on copper production and other exports, which accounts for nearly seventy percent of the Gross
National Product (Ministry of Finance and National Planning, 2002).
Copper mining is very capital-intensive and machinated. As a result, the local population does not have a direct hand in the mining and
processing of the minerals. Agriculture, therefore, is the mainstay for
most rural populations.
Table 1.1 (page 15) contains the basic socio-economic data
about Zambia. The table shows that the country’s geographically
dispersed population had a per capita income of US$308 in 2000.
Technical skills are low as indicated by the 48% gross enrollment in
primary, secondary and tertiary schools. The country is saddled with a
huge US$5.8 billion foreign debt, which contributes to the expatriation
of revenue from the treasury to foreign creditors. Statistically, 63.7%
of the population subsists on less that US$1.00 per day. 3 A comprehensive information and communication technology
(ICT) policy aimed at alleviating Zambia’s situation in education, health, agriculture and industry has been developed. According to the
United Nations Human Development Index Report of 2004, Zambia was ranked 166th in the 2005 Human Development Report out of 177 countries as one of the poorest nations in the world (United Nations
Human Development Index Report, 2005).
Table 1.1 - Basic Socio-Economic Data about Zambia Indicator Value Population 11 million Population Density 14 per square km Urbanization (% of population) 40% (1999) Population Growth 2.9% (2000) GDP US$8.5 billion PPP (2000) GNP per capita US$ 308 (2000) PPP per capita US$ 870 Annual real GDP growth rate 3.9% avg. 1995-99 Exports US$ 876 million (f.o.b 2001 est.) Export Commodities Copper 55%, cobalt, electricity, tobacco, flowers, cotton Imports US$ 12.05 billion (c.i.f 2001 est.) Structure of Economy Agriculture: 24% Industry: 25% Services: 51% (2000) Foreign debt US$ 5.8 billion Labor Force Agriculture: 85% Industry: 6% Services: 9% (2000) Infant mortality Rate 89.39 deaths/1000 live births (2002 est.) Adult Literacy (15 years and over) Male: 85.7% Female: 72.6% Primary, secondary, tertiary school 48% (2004) enrolment (% gross) Poverty (% of population below US$1 63.7 (2004) per day) Human Development Index - 2005 Ranks Zambia at 166th 4 Sources: World Development Report 2005; Central Statistical Office; CIA World Fact Book; Hesselmark, Esselaar & Silavwe, 2002; World Bank – ICT at a Glance (2005) and HDR - 2005.
Background of the Study
World wide, a rapid pace of technological innovation characterized the last decades of the Twentieth Century, accompanied by the equally rapid integration of new technologies into society. Some scholars termed the wave of technology innovation and adoption as the second industrial revolution (Brooks, 1994). The first industrial revolution comprised the profitable utilization of land, labor and capital and all three needed to be available for any meaningful development to occur. However, in this second industrial revolution, these three factors are relatively insignificant, and a dearth of any of those factors would not preclude any given nation from fully reaping the benefits of integrating new technology into society. To the detriment of most
African economies, the continent’s comparative advantage in labor costs, which might have been a substantial attraction to international investors in earlier decades, has become less significant with the emergence of the new information and communication technologies,
(ICTs) which appear to require more quality labor as opposed to quantity.
Telecommunications and all ICTs in general rode on the backs of a range of network infrastructures and user competencies, which 5 determined the scope and reach of ICT services. The networks in
developing countries, including Zambia, were generally
underdeveloped, a factor that contributed to the limited diffusion of
ICTs. The developed countries did not have to address issues of
scarcity of infrastructure and access to the infrastructure as much
because they already possessed such terrestrial, submarine and space
networks, and possessed a critical mass of knowledgeable producers
and skilled consumers. These countries, as a result, more easily
adapted to the waves of new communication technology and their
eventual convergence.
Using the Internet, broadband services and international
bandwidth as indicators for access to the telecommunication networks,
Table 1.2 (page 18) highlights the disparities in selected countries including aggregates per continent. According to the International
Telecommunications Union (ITU) indicators, Africa has 1.5 percent of all Internet users, having the least connected population amongst all
continents. 18 Table 1.2 - Internet, Broadband Services and International Bandwidth Indicators Internet Broadband International Bandwidth Subscribers Total As a % of Subscribers Total Bits per (000s) (000s) total per 1000 (Mbps) inhabitant 2004 2004 subscribers inhabitant 2004 2004 2004 2004 Selected Countries Zambia 11.6 0.05 0.4 0.004 12.0 1.1 Mozambique … … … … 18.5 1.0 Nigeria 53.2 … … … 72.0 0.6 Malaysia 3,545.4 252.7 7.1 9.88 3,193 124.8 Continents Africa 5,813.3 112.7 2.0 0.17 5,329.4 6.4 Americas 97,137.2 47149.6 48.6 57.29 1,268,896.5 1,520.6 Asia 156,736.4 60,163.5 39.5 51.34 474,207.3 3,643.0 Europe 114,294.4 40,546.7 35.9 51.34 2,929,246.0 3,643.0 Oceania 6,821.8 1,641.0 24.1 62.94 26,789.6 842.0
World 380,803.2 149,613.4 39.9 27.56 4,704,468.8 759.0 Source: ITU, World Telecommunication Indicators 2004/2005 19 Developed countries were able to cultivate the opportunities
presented by the growth in such ICT applications as e-commerce.
Ironically, these developments also multiplied the risk of creating
poverty and dependency in developing countries. According to Grace
et al. (2004), the advantage of developed network infrastructures in
more advanced countries contributed to the widening digital divide
between developing and developed countries because the provision of
services and access to ICTs in developing countries were slower, which
resulted in those countries having less opportunities to benefit from
the networked nature of ICT products and services. Kiplagat and
Werner (1994) observed that African countries were held back by
political restraints on the private sector, such as lack of autonomy of
telecommunications operating companies and insufficient regional
cooperation. Kiplagat and Werner predicted that once such
impediments were removed, financial resources would become readily
available as evidenced in the United States and Britain after
deregulation of their telecommunications networks.
The Zambian government and the governments of several other
developing countries followed the lead of Britain and the United States
to deregulate their telecommunications sectors and implement national
policies on ICTs. In addition, the governments signed trade pacts with
Multilateral Organizations (MOs) to increase access to funding, 20 technical support and knowledge about ICT programs. With active
help and guidance from such Multilateral Organizations as the World
Bank, the Zambian government undertook telecommunications sector reform measures beginning in 1993. These reforms focused on liberalization and deregulation and included the
o ratification of the Telecommunications Act of 1994,
o creation of autonomous telecommunications and
broadcasting regulatory authorities,
o facilitation of competition, and
o separation of the post and telecommunications operations
into independent business units (Habeenzu, 2003;
Telecommunications Act, May 1994, section II).
International and regional MOs supported Zambia’s policy reforms by
funding a Technical Committee to coordinate the ICT policy process.
MOs also provided “expertise and other resources and supported the
diffusion of ICTs as a means to reduce poverty and boost the national
economy” (Victor Mbumwae1, personal communication, August 19,
1 Mr. Victor Mbumwae left his lecturing job at the University of Zambia Engineering Department to head the technical committee for ICT policy formulation under the auspices of the Ministry of Communications and Transport. The World Bank and the Tokyo International Conference on African Development (TICAD) support his position. TICAD is a United Nations Development Program project established with the objectives of ICT policy framework development, capacity building and sensitization and pilot projects. 21 2004). Chapter Six in this dissertation discusses the role of Multilateral
Organizations in more detail.
The most notable of the Multilateral Organizations offering
technical expertise and financial assistance to Zambia was the World
Bank. The World Bank had previous exposure to both the private and
public sectors of Zambia’s economy and was simultaneously working in
several Sub Saharan African (SSA) countries on programs similar to
those in Zambia. The World Bank, not known for custom designed intervention measures, devised a strategy comprising three core pillars. These pillars serve as guide posts to aid countries in the SSA region in planning, monitoring and evaluating their efforts related to liberalization and deregulation of their telecommunications sectors.
The Figure 1.2 (page 22) represents that strategy.
The first pillar focuses on key elements in sector reforms,
namely: liberalization, deregulation, privatization and capacity
building. The second pillar emphasizes the specific objectives of the
sector reforms such as universal and rural access, and improvements
in the infrastructure and reconstruction, in the case of post conflict
countries. The third pillar focuses on ICT applications. These include e-
commerce activities, e-governance issues and technological
applications like mobile telephony. 22 Figure 1.2 - Three Core Pillars of the WB ICT Strategy for Regional Integration and Connectivity in Sub-Saharan Africa. Adapted from Guislain, Ampah, Besancon, Niang, and Serot, (2005).
The Core Addressing ICT for Reform Agenda Market Failures Development - Market - Rural access Applications liberalization - National - E-commerce - Regulation backbone - E-government - Capacity - Post-conflict - Civil Society building countries Applications - Privatization - Postal Sector Reform
Regional Integration and Connectivity
Definition of Terms
This section identifies and explains the context in which common terms are used in this dissertation in reference to the discourse surrounding Zambia’s ICT policy.
Information and Communication Technologies (ICTs)
Guislain et al. (2005) defined Information and Communication
Technology as a broad and encompassing term that refers to the range of technologies that facilitate the sharing of knowledge. These technologies include the: (a) telecommunications infrastructure that provides the underlying foundations for communication through mobile and fixed line telephony; (b) globally distributed networks such as the 23 Internet that ride on satellite and fiber optic transmission
technologies; and (c) ICT-based industries that employ a range of
Internet related and information technologies (IT) such as computer
and communications hardware and software used to automate and
augment clerical, administrative, and management tasks in
organizations (Guislain et al., 2005).
The Zambian ICT policy defined ICT in terms of national
development (ICT4D), where technology was integrated within national development and poverty reduction agendas and applied to such social and economic sectors as health, education, governance, agriculture, tourism, mining and manufacturing (Ministry of
Communication and Transport, 2005).
ICT Policy
According to Marcelle (2000), a national ICT policy is an
integrated set of decisions, guidelines, laws, regulations, and other
mechanisms designed to direct and shape the production, acquisition,
and use of ICTs. The ICT sector is heterogeneous, extending beyond
traditional classifications of industrial or services sectors. Therefore,
national policies in the ICT sector would intersect with a number of
other areas of policy-making, such as technology, media, industrial,
and telecommunications policies. 24 Figure 1.3 (page 25) illustrates these areas of intersection
among the various policy spheres by placing ICTs at the core of all
national development decisions regarding policy. Whereas these
disparate policies may be specific, for example the media policy
focusing on the broadcasting sector, the ICT policy encompasses
objectives from different areas of the economy such as infrastructure
development (telecommunication policy), content management (media policy), skills transfer (technology policy) and incentives (industrial
policy). The development of these policies in Zambia was done
piecemeal in a non-linear fashion. Therefore, by the time the ICT
policy was to be developed, Zambia already possessed a
telecommunications policy, while the media and broadcasting policies
where developed separately (Banda, 2003). 25 Figure 1.3 - Relationship between ICT Policy and other Areas of Development
Source: United Nations Commission for Science and Technology Development (UNSTD) (1997).
Figure 1.4 (page 26) represents the UNSTD’s schematic of the various actors likely to be involved in domestic ICT policy-making. In practice, there are variations of this model from country to country because individual countries designed their ICT policies according to their own objectives, values, and cultural practices. For example,
Figure 1.4 (page 26) omits explicit mention of Multilateral
Organizations because their functions are multi-sectoral, as will be shown in Chapter Six. The figure also is thought to be representative of developed countries, which have less of a need for Multilateral
Organizations as compared to developing nations. In the case of 26 developing nations, Multilateral Organizations are included as an
external actor, or as a facilitator, working within distinct sectors.
Multilateral Organizations can support projects and programs in more than one government ministry or sector of the economy. For
example the World Bank supported the ICT Technical Committee in
Zambia to facilitate the creation of Zambia’s ICT policy while funding
the roll out of fiber optic capacity by the Zambia Electrical Supply
Corporation (ZESCO, 2005). Deliberate interactions among all these
sectors are intended to create a coherent ICT policy and are necessary
as a result of ICT convergence as explained below.
Figure 1.4 - Key agents in Policy-making Processes
Source: United Nations Commission for Science and Technology Development (1997).
27 ICT Convergence
ICT convergence consists of two parts; the first comprises the
backbone and the second comprises applications and services. The
backbone is the seamlessly interconnected federation of cable and
wireless networks, which together permits end-to-end interoperability
of applications and services. This telecommunications backbone is
made up of microwave links, cell phone towers, fiber optic cables,
satellite stations and copper wire cables providing video, voice and
data services worldwide with a high level of reliability and quality of
service (QoS). The interoperability between the different systems is
insured by standards set up by industry and MOs, such as the
International Telecommunications Union (ITU). Such standards include
the Internet Protocol (IP) platform that allows users connected to
different network infrastructures to have a common language for exchanging data with a guaranteed QoS (Moore, 1998).
In Zambia, telecommunication infrastructures consist of hybrid
platforms of copper, fiber, wireless and satellite communication. For
example, in addition to using its fiber optic cables for internal
telephone services, the Copperbelt Energy Corporation (CEC) in
Zambia leases out bandwidth on its fiber optic cables to mobile
telephony providers, Celtel and Telecel, as a backhaul service for their
cellular phone traffic, resulting in faster calls between cities in the 28 Copperbelt province. According to Nang’alelwa Sitwala, Chief
Telecommunications Engineer for Zambia’s largest electric power utility, Zambia Electricity Supply Corporation (ZESCO), its fiber optic network will be used to transmit voice communications, data and video services originated by broadcasting, Internet and television businesses in Zambia (personal communication, August 31, 2005).
The second level of convergence refers to the applications and services. According to Flournoy (2004), converged services are those capable of integrating customers' requirements for communication, information, entertainment, and commerce. This is made possible by heterogeneous equipment that intercommunicate and proprietary software and systems that are transparent. These rely on new technologies such as digital compression and Asynchronous Transfer
Mode (ATM). Digital compression is the process of reducing the number of bits needed to represent a given set of data, hence reducing the bandwidth needed to transmit it. This procedure increases the feasibility of transmitting video and large files over more limited telecommunications networks.
Asynchronous Transfer Mode (ATM) technology is a common strategy for extending narrowband network capabilities transformed as 29 broadband2 carriers. Flournoy (2004) defined ATM as a switched-based transmission technology that accommodates the simultaneous sending
of data, voice and video at variable rates from megabit to gigabit
speeds in a packet format.3 ATM information is segmented into fixed- length units or cells prior to transmission; the information is reassembled at the destination. ATM can be transported over twisted pair, coaxial cable, fiber-optic lines, or wireless connections.
As Hudson (1999) observed, the convergence of
telecommunications, data processing, and imaging technologies
ushered in the era of multimedia where voice, data, and images are
combined according to the needs of users, and the distinctions
between traditional sectors of telecommunications, information
processing, and broadcasting are increasingly arbitrary and perhaps
irrelevant. For example, the planned roll out of third generation (3G)
cellular networks in Zambia will facilitate video viewing on mobile
phones.
2 Broadband is any telecommunication path that provides multiple channels of data over a single communications medium. 3 A packet is a digital communications data format; a megabit refers to millions of data bytes; a gigabit is a billion such bytes (Flournoy, 2004). 30 Liberalization, Deregulation and Privatization
These three concepts are often used interchangeably; however, in this dissertation an effort is made to provide separate interpretations according to the Zambian context.
Petrazzini (1995) defined liberalization as the lowering of entry barriers to all or parts of a market by allowing third parties to compete with established – generally monopoly – providers of goods or services. In a liberalized telecommunications market, service providers are generally free to set prices and determine service expansion and business strategies on their own. He defined deregulation as the process through which governments reduce their intervention in the operation of markets. The dismantling of legal controls, thus created, presumably provides the adequate condition for a healthy competitive business environment operating under market laws.
Privatization refers to the selling of all or a stake in the incumbent operator to private investors. Privatization can also be defined as the transfer of commercially oriented state-owned enterprises (SOE), activities, or productive assets of the government to the total, majority, or minority private ownership or private control.
From this point of view, Petrazzini says that privatization includes the public offering of shares, private sale of shares, sale of government 31 assets, management or employee buyouts, new private investments in a SOE, and lease and management contracts.
Social and Economic Benefits of ICTs
There is little doubt that ICTs and their accompanying networks have brought beneficial changes to the economic, social and political structures of Zambia. For example, the explosive growth in mobile telephony has resulted in the birth of such new businesses as vending in cellular phones, SIM cards, top-up scratch cards and cellular-phone battery-charging services.
The evidenced social and economic benefits are generally attributed to sector reforms in nearly all countries, therefore implying that without these sector reforms, these benefits would not be as significant. Over the last decade, as shown in Figure 1.5 (page 32), nearly all countries in Sub Saharan Africa have adopted telecommunications sector reforms as well as legislation establishing regulatory bodies. The impact of these reforms in Africa has been notable. The results include an increase in the number of Africans using telephones, email, and the Internet to communicate, to share information, to collaborate, to entertain and to work.
32
Figure 1.5 – Regulatory Bodies in Africa in 2003. Adapted from ITU
(2003)
According to the ITU, (Table 1.3, page 33) in 2001 the number of cellular subscribers in Africa exceeded the number of subscribers of fixed line telephony and held steady since then. The boom in mobile phones is attributed to three essential factors. The first is the ease in deploying the wireless infrastructure; second is liberalization, which led to the opening of the mobile telephone markets, and lastly is the 33 financial accessibility of the mobile telephone by users, especially through the prepayment system (ITU, 2003).
Table 1.3. ITU Teledensity Report of SADC and COMESA Countries
Population Main Mobile Internet telephone subscribers users lines 000s 000s % 000s % 000s % South Africa 46'365 4'800 10.4 16'860 36.4 3'300 7.1 Angola 14'358 90 0.6 250 1.7 50 0.3 Botswana 1'760 160 9.1 493 28.0 60 3.4 D.R. Congo 52'771 10 0.0 1'000 1.9 75 0.1 Kenya 31'708 328 1.0 1'591 5.0 500 1.6 Lesotho 2'174 30 1.4 165 7.6 25 1.1 Malawi 10'488 85 0.8 135 1.3 36 0.3 Mozambique 18'831 80 0.4 429 2.3 60 0.3 Namibia 1'924 127 6.6 190 9.9 65 3.4 Nigeria 123'314 853 0.7 3'149 2.6 1'600 1.3 Swaziland 1'044 35 3.4 88 8.4 22 2.1 Tanzania 35'313 149 0.4 891 2.5 250 0.7 Uganda 25'599 61 0.2 776 3.0 125 0.5 Zambia 11'195 90 0.8 150 1.3 65 0.6 Zimbabwe 11'765 300 2.5 363 3.1 600 5.1 Sub-Saharan 601'735 4'898 0.8 17'047 2.8 5'086 0.8 AFRICA 648'101 9'697 1.5 33'907 5.2 8'386 1.3 Adapted from ITU (2005). Legend: % = percentage of total population
In addition to telecommunication reforms, consumers and private sector enterprises have become more comfortable using e- commerce services, capturing trade opportunities on the Internet, and reaping productivity gains from access to information and communications technologies. Governments and civil society 34 organizations are bringing greater efficiency to the delivery of public
services and capitalizing on IT-based management systems to improve
government transparency, public participation in governance and
accountability, as well as to leverage limited resources.
Despite the positive outlook presented by adoption and use of
ICTs in the economy, some people in the Zambian government and
other sectors harbor misgivings about the motives of Multilateral
Organizations, especially the World Bank and International Monetary
Fund (IMF) participating in the shaping of the country’s ICT policy. The
recent history of the IMF’s and the World Bank’s supported Structural
Adjustment Programs (SAPs) led to quite negative perceptions of these
organizations. Some Zambians perceive that the motivation behind
these organizations’ efforts is to speed the sale of Zambia’s remaining
government owned and operated corporations, such as Zambia
Telecommunications Corporation (ZAMTEL) and the Zambia National
Commercial Bank (ZANACO), which could result in loss of revenue, power and influence in those sectors, as was the case for other privatized companies. For example, the Zambian Minister of
Commerce, Honorable Deepak Patel, lambasted the World Bank and the IMF for their experimental practices while speaking at the World
Bank round table discussion on “Aid for Trade.” As reported in the 35 Post, a Zambian daily newspaper (February 16, 2006), the Minister
charged
“we (in Zambia) were prescribed a package of recessionary
measures, including cutting back on public expenditure and
raising interest rates, to control money supply and inflation
rates, and then our consultant “physicians” wondered why the
economy went into recession, why the poor got poorer and why
the health and education systems collapsed” (p. 1).
In conclusion, the minister charged that due to the country’s experience with neo-liberal economic recovery measures that where supported by the Bretton Woods institutions
“it is easy to believe that this new ‘Aid for Trade’ therapy is the
latest fad from the consultant “physicians” in whom we place so
much trust to experiment on the patient with multiple therapies
which, in a hit and miss fashion, they hope will treat the causes
rather than the symptoms. ....in the World Trade Organization
(WTO), we pay attention to political sensitivities of the world’s
richest and most powerful to the detriment of the economic
realities of the world’s poorest” (p. 1).
Although the Minister of Commerce was not presenting the official
government reaction to Multilateral Organizations, comments such as
his are not uncommon in Zambia from both public officials and private 36 citizens. The comments illustrate the public’s latent mistrust in these
Multilateral Organizations.
Another concern related to dependency on foreign suppliers for maintenance of ICT systems once introduced into Zambia. In an interview with Chalwe Mchenga, Zambia’s Director of Public
Prosecutions (DPP), he indicated that he is implementing a nation wide computerization of the Department of Public Prosecutions in order to improve on service delivery. While acknowledging the importance and the efficiencies brought about by ICTs, he said,
ICTs must be diffused alongside skills training for the users. ICTs
have great benefits for law enforcement if they are used by
people who know what they are doing. Sending documents from
Mongu4 takes weeks when in fact they could be take minutes if
they were scanned and emailed or faxed. Donors must bring
compatible hardware rather than be pushing for products from
their countries. When they do that, they cause perpetual
dependency because equipment needs regular maintenance or
replacement” (personal communication, August 3, 2005).
4 Mongu is the provincial capital of the Western Province. It is peri-urban and therefore not very well developed in terms of ICT infrastructure. Refer to Figure 1.1 (page 15) for location. Mongu was used in the discussion as a descriptor of other towns and cities in Zambia that have similar levels of ICT penetration. Therefore, this example is applicable to those other towns as well. 37 Policy Process
Like most African countries in the 1990’s, Zambia embarked on
an ambitious telecommunications reform program aimed at increasing
investment and efficiency in the sector following the examples of the
USA and Britain. In 1994, the government enacted the
Telecommunications Act of 1994, which separated the functions of the
Posts and Telecommunications Corporation (PTC) and created the
autonomous Communications Authority of Zambia (CAZ) (Habeenzu,
2003). The Communications Authority of Zambia is the body mandated
to facilitate competition and to ensure that the benefits of competition
accrue to the citizens of Zambia and its economy. In addition, the
CAZ is empowered to facilitate investments by licensing parties in the
telecommunications sector as well as to protect consumers and sellers.
The CAZ is expected to operate as a neutral arbitrator in the public
interest (Telecommunications Act, May 1994, section II). In reality,
the Authority has been handicapped because of its inability to fully
regulate the Zambia Telecommunications Corporation (ZAMTEL).
In 1996, a policy framework and a regulatory structure designed
to provide a fair, transparent and predictable regulatory environment in Zambia was established (CAZ, 2004). In an attempt to address the past failures and to respond to the current global technological and economic trends, the Zambian government began taking steps 38 towards privatizing the telecommunications sector. However, due to
the complexity of the ICT convergence, policy-makers in Zambia had
difficulty sorting out its specific, economic and political significance.
Policy-makers appreciated that the capacity to generate a coherent
policy depended on the need to develop an understanding of the
mechanics and mechanisms of ICTs, on one hand, and on the other, to
develop an understanding of the contrariness of the ICT revolution in
terms of cost benefit analyses, and the need not to be blinded by the
revolution’s pervasive rhetoric (Mansell and Silverstone, 1996).
Theoretical Perspectives
The creation of a national ICT policy, according to this researcher, is a matter related to political economy. Political economy in this dissertation is used as a theoretical approach in the combining of political and economic analyses to better understand the importance
and role of ICTs. This approach was adopted based on the literature
and based on observation of stakeholder behaviors and the types of
policies advocated. Multilateral Organizations present ICTs as means
and products necessary for economic improvement, by giving
examples of successful implementation in Europe and the United
States of America. While some Zambians agreed with this position,
others are wary about such factors as the power, control and 39 ownership of the means and production of ICTs and their content. The political and economic nature of these relationships is discussed in
Chapter Two using the modernization and dependency paradigms as the theoretical anchors.
Purpose of the Study
Scholarly research on the role of Multilateral Organizations in the policy formulation process for ICTs in Zambia is lacking. Furthermore, the literature reveals that the domestic efforts that Zambia has made to design a policy to regulate the ICT sector benefited from considerable input by Multilateral Organizations. The purpose of this research, therefore, is twofold. The first goal is to identify, examine and contextualize the roles of Multilateral Organizations in the country’s ICT policy formulation process, while also describing their backgrounds, structures and relationships with Zambia in particular and the developing world in general. The second goal is to analyze and evaluate the implications of the policy choices as they relate to the ICT sector in Zambia.
Research Questions
The review of literature and the researcher’s observation of the
ICT policy process in Zambia contributed to the design of the research questions. The “role” of the MOs being an operative word in the 40 research was elaborated to the interviewees in terms of the capacity,
position, responsibility or duty of Multilateral Organizations. Therefore,
open-ended questions were developed according to the area and level
of involvement of participants in the policy reform process. The
participants comprised authorities affiliated with Multilateral
Organizations, the Zambia government, private sector or private individuals. The researcher introduced the research stating the objectives each time a new interview was commenced. This was important to prepare the interviewees to place the questions in context. The questions were:
1. What are the main objectives and priorities for Zambia’s ICT
policy?
2. What are the leading organizations (regional and international)
and how were they involved in formulating and implementing
Zambia’s ICT policy?
3. What is the trajectory of the formulation and implementation of
the ICT policy?
4. What concerns do you have about the ICT policy and the
formulation process?
The four questions were not asked in the stated order each time
because some interviewees covered more than one question in their 41 responses. The appearance of repetition in some questions provided
the chance to probe for specifics.
Overview of Chapters
Chapter Two reviews the literature pertaining to Multilateral
Organizations and their role in diffusion of ICTs to developing nations following the convergence of information and communication technologies in the 1990s. The chapter also reports on the development of telecommunications and sector reforms in Mozambique and Nigeria.
Chapter Three describes the modernization and dependency
paradigms as suitable theoretical models for the analysis on ICT process policy in relation to Multilateral Organizations. The chapter
discusses of the globalization theories relevant to the dissertation.
Chapter Four describes the research objectives and methodology
applied in this dissertation. The chapter discusses data collection and
analysis.
Chapter Five describes the structural processes and reforms embarked on to achieve regulatory changes in the ICT sector. The
chapter provides a background of the development of Zambia’s ICT
policy and examines the roles of the regulatory bodies and other
stakeholders. The chapter also describes the impact on technologies in 42 Zambia resulting from regulatory changes.
Chapter Six discusses and analyzes the roles of Multilateral
Organizations in Zambia’s ICT policy process. The discussions are framed in political economy discourse and explained using the modernization and dependency paradigms. The Chapter outlines the multilevel phenomenon of ICT policy that necessitated the interactions between domestic, regional and international policy-makers.
Chapter Seven concludes the study and answers the four main research questions. The chapter itemizes policy implications on the ICT sector and recommendations for future study. 43
Chapter Two – Literature Review
Introduction
This chapter examines the prior research relevant to an examination of the influence of Multilateral Organizations on developing nation policies and related theory. Specific attention is given to policy changes in politics, telecommunications and economics in Zambia. The literature relevant to this research is grouped into seven subcategories:
1) Historical Context of Policy Reforms
2) New Technologies for Development
3) From Nationalization to Privatization
4) Multilateral Organizations and Domestic Policy
5) Technology Determinism
6) Information and Communication Technologies and Social
Context
7) Comparative Country Analysis
The literature is awash with differing perspectives on the use of
ICTs for improvement of developing societies. The common
denominator, however, is the admission by scholars that ICTs have
significant effects on all societies. Since the 1980s, when development
experts began to place telecommunications at the forefront of 44 development strategies, the prevailing assumption has been that ICTs
can accelerate economic growth in developing countries (Singh, 1999).
The term “leapfrogging” was often used to underscore the potential of
telecommunications. According to Singh (1999), leapfrogging means
telecommunications can “help less developed countries ‘skip’ some
stages of development; help them accelerate development; and skip
technological barriers or product cycles.” Since the 1980s, ICTs have
increased in capacity and interoperability. Therefore, the term ‘skip
forward’ epitomizes the desired outcomes envisioned by policy-makers
in different countries during the 1990s when they embarked on
telecommunications policy reforms.
Such noted scholars as Bella Mody, Heather Hudson, Schement
and Napoli wrote about the significance of telecommunications in
improving the living conditions of people in developing countries. Their
writings reinforced ICT adoption in countries like Zambia that were
following a pro-growth policy reform agenda. Mody (1995) observed
that telecommunications led to social and technological changes, which
has positive effects on the openness, connectivity and decentralization
of societies. Napoli (2001) ascribed an economic benefit to Universal
Service. He argued that, by connecting to the network, a household obtains increased “network externalities” because the value of a network’s service increases proportionate to the number of subscribers 45 to that service. Schement (1995) ascribed political benefits to
Universal Service by observing that, in an interconnected or
“networked” democracy, citizens can make more informed decisions.
Access to technology affords people opportunities they would not normally have to participate in democratic dispensation.
Historical Context of Policy Reforms
According to Spiller and Cardilli (1997), in most countries of the
world, the telecommunications industry is established as a natural
monopoly that permits little or no private participation. Countries often
cite security, cultural and legal concerns as reasons for maintaining a
natural monopoly. As national utilities, telecommunication services are
often attractive cash cows for the national treasury. However,
following deregulation of the telecommunications sectors in the United
States and Britain during the 1980s when “neo-liberal” reforms
obligated these governments to restructure their telecommunications
industries, more diverse forms began to appear throughout the world.
Noll (2000) observed that the movement away from a
ministerial, state-owned enterprise toward greater reliance on private
organizations and market incentives to shape the evolution and
performance of the telecommunications industry signified neo-liberal
reform. He explained that African countries adopted neo-liberal 46 reforms because of two fundamental circumstances. The first had to do
with the economic crises that swept over many developing nations in
the 1970s and 1980s. These crises necessitated the introduction of
Structural Adjustment Programs (SAPs), sponsored by Multilateral
Organizations such as the World Bank and International Monetary
Fund, which were subsequently unsuccessful. The second was the poor
performance of the telecommunications sector.
Sterling, Bernt and Weiss (2006) observed that the two leading
examples of successful sector reforms, the United Kingdom (UK) and
United States (USA), had completely different origins. In the case of
the UK, the British Telecom (BT) was a government owned monopoly.
Therefore, privatization led to ownership transfer from government to
the private sector. In the USA, the telecommunications monopoly,
American Telephone & Telegraph (AT&T) was already a privately
owned corporate conglomerate made up of the interconnection of
many smaller telecommunications companies. Its operations
resembled a government entity because of the manner in which it
worked closely with government to achieve social ends such as
Universal Service. When Theodore Vail was president of AT&T during
1885 to 1889 and again from 1907 to 1919, he established the “one
system, one company, Universal Service” after he famously argued
that 47 “the position of the Bell System is well known. It is believed that
the telephone system should be universal, interdependent and
intercommunicating, affording opportunity for any subscriber of
any exchange to communicate with any other subscriber of any
other exchange….It is not believed that this can be accomplished
by separately controlled or distinct systems nor that there can
be competition in the accepted sense of competition (Sterling, et
al., 2006).
The USA provides an appropriate benchmark in discussing the trajectory of telecommunications policy reforms because of its long history of legislative involvement in the sector. Important legislation since the Kingsbury Commitment of 19135 included the
Telecommunications Act of 1934, which established the Federal
Communication Commission (FCC) to regulate wire telegraph, phones and broadcast. The Act of 1934 did not explicitly describe Universal
Service that was provided by AT&T (Paglin, 1989). The last extensive legislative action resulted in the enactment of the Telecommunications
Act of 1996, which demanded that operators provided Universal
Service.
5 The Kingsbury Commitment of 1913 ended the dual service era and facilitated universal interconnection between competing independent telephone companies and the giant Bell telephone company (Mueller, 1997). 48 Sterling, et al. (2006) give examples of judicial decisions that included the significant lawsuit brought by Microwave Communications
Incorporated (MCI) against AT&T in 1980 for antitrust practices, leading to competition in long distance services. The dismantling of the
AT&T conglomerate in 1984 also happened via a court action directed by Judge Harold Greene, who ensured that AT&T’s divestiture resulted in the creation of the seven Regional Bell Operating Companies
(RBOCs). To further regulate the industry, Judge Greene administered the Modified Final Judgments (MFJ), which barred the RBOCs from the provision of information services, manufacture and provision of customer premise equipment (CPEs), and generally from providing services other than telecommunication exchanges. This era marked the beginning of the competition that was further augmented in the
Telecommunications Act of 1996. The Act of 1996 sought to achieve four broad goals: lower customer prices; improve quality of service; facilitate rapid diffusion of telecommunication technologies; and ensure Universal Service (Sterling, et al., 2006).
The RBOCs immediately attracted new capital, streamlined management teams and, with some incentives from the federal government, continued to provide Universal Service. The USA model became a template used by many countries around the world to 49 restructure their telecommunications industries. The Leland Initiative6 actively aided developing countries crafting their telecommunications policies after the prevailing norms and practices in the US, such as reducing regulation and facilitating competition, which later formed a big part of the US Telecommunications Act of 1996.
Needless to say, developing countries had an even greater need for telecommunications sector reforms, especially in adopting policies and practices that would enhance the use of ICTs in all sectors of the economy. As a policy imperative, most governments in developing countries have moved away from monopoly provision of telecommunication services to a competitive structure with several operators in the market. For the most part, the provision of competitive services has led to wider coverage, quicker connections, an increase in teledensity, and improved quality of service (QoS).
Matusz and Tarr (2000) opined that economic research rather well documented the long-term benefits from improved resource allocation and efficiency that followed from policy reforms. And although causation remained an issue, studies had shown strong and
6 The U.S. Agency for International Development (USAID) used the Leland Initiative to assist African nations in entering the information age by overcoming policy and access obstacles to Internet connectivity, and improving cooperation between government and private sector in using the Internet to increase efficiencies of institutions that contributed to sustainable development in USAID-assisted countries in Africa (Ferdinand, 2000).
50 consistent correlation between those reforms and economic growth.
Despite the evidence of real benefits, some developing world policy-
makers were reluctant to implement the reforms. Privatization of
ZAMTEL in Zambia was such an example due to the fear of excessive adjustment costs and fall out with the unions and the general public
(Habeenzu, 2003).
In the spirit of the developments in the industrialized countries,
Zambia embarked on telecommunications reforms to increase
investments and efficiency in the sector. Investment and efficiency
became the cornerstone of the reform process. The direction of policy
reforms in Zambia was similar in principle to those outlined the USA
Telecommunications Act of 1996, which endorsed long-term
development trends toward a competitive marketplace, vertically integrated corporations, and a minimalist regulatory stance
(Aufderheide, 1999). Under the Zambian Telecommunications Act of
1994, two major accomplishments were realized.
First, the functions of the Posts and Telecommunications
Corporation (PTC) were separated into the Postal Services Corporation
(PSC) and the Zambia Telecommunications Company (ZAMTEL). Both are still government owned and operated. The two companies were corporatized and separate and distinct management teams were 51 created which led to improved resource allocation and efficiency
(Habeenzu, 2003).
Secondly, the creation of the Communications Authority of
Zambia (CAZ) promoted competition, facilitated investments by licensing businesses and protected consumers (Telecommunications
Act of 1994). The unfortunate part about the procedural and structural safeguards of the Telecommunications Act of 1994 and the break up of
PTC, was that they were costly for Zambia to implement and assumed the presence of a highly developed legal system that was not yet present (Noll, 2000).
Whereas it was not difficult to create the broad reaching
Telecommunications Act of 1994, the Zambian government faced
greater challenges in articulating and employing constituent parts of
ICTs for development. For example, the government lacked the political will to privatize ZAMTEL, which is still monolithic. The failure to privatize ZAMTEL slowed down the emergence of marketplace competition envisaged in the Telecommunication Act of 1994. The government cited national and public interest as factors for delaying the privatization of ZAMTEL, and for blocking other operators from
competing in the international gateway (Habeenzu, 2003). In the
meantime, new technological innovations such as Voice over Internet
Protocol (VoIP) continued to blur distinctions between new and old 52 communication technologies. Napoli (2001) observed that the convergence of old and new technologies would only further complicate the formulation of ICT policies.
The public interest, as used in the case of ZAMTEL, was context bound. For example, Aufderheide (1999) observed that, for policy- making purposes and with the rise of deregulation, the public and a vigorous marketplace were basically the same. This was an economic argument based on the premise that as long as the telecommunications sector was vigorous and growing, widely offering more jobs and a greater selection of products and choices, public interest was achieved. According to Aufderheide, the “public” are often uninformed and apathetic about the details of policy. This characteristic led the Zambian government to decide that it should act on the public’s behalf for their “protection” from the many perceived imbalances that would be created within the sector.
Sterling et al. (2006) observed that the basic premise of public interest is that the primary goal of the regulator and the primary motive for regulation is the protection of the public from potential abuses in the marketplace. Granted the two characteristics of the
“public” as identified by Aufderheide may be contradictory, the
Zambian government applied both definitions in their policies. The spirit of reform was pro-business and pro-growth, but the “put the 53 people first” rhetoric created awkward and unclear conditions for efficiency and competition to develop.
According to Sterling et al. (2006), the public interest theory is
the oldest and perhaps the most obvious theory of regulation. Public
interest theory developed in the early years of regulation, during which
some industries were regarded as natural monopolies. The assumption
underlying the concept of a natural monopoly is that, in some industries, because of the high costs of market entry or because of
economies of scale and scope, one company can provide service more
cheaply and efficiently than can two or more. Even though a monopoly
may be efficient, the monopoly provider can, if unchecked, abuse its
power by refusing to provide service, by pricing unfairly, or by
providing substandard service. The role of the regulator, according to
the public interest theory, is to prevent these abuses of monopoly
power by regulating price, service provision, and service quality.
New Technologies for Development
The link between technology and development has been
established through showing positive relationships between
telecommunications infrastructure growth and socioeconomic growth.
Bjorn Wellenius of the World Bank describes how “telecommunications
constitutes the core and provides the infrastructure for the information 54 economy as a whole. Telecommunications facilitates market entry,
improves customer service, reduces costs and increases productivity”
(Wellenius et al., 1993. p1).
Information and communication technologies used in
development have unique characteristics that, to some, are quite
arcane. Moore (1998) describes how fixed line systems, for instance,
have distance-sensitive cost structures, but low marginal cost on
dense routes; how wireless systems are spectrally efficient and
innovative at frequency reuse for local networks but not efficient in
distance communication; and how satellites provide high quality
service over large geographic areas but are less effective for on
demand access.
This section highlights the literature on some essential communication technologies such as satellites, wireless, fiber-optics
and the Internet that work together in an interconnected infrastructure
or independently. In Chapter Five, these technologies are described in
more detail in the context of their usage in Zambia. Table 2.1 (page
55) shows four of these technologies and their unique characteristics
that affect decisions to adopt. The table shows that fiber optics is the
most expensive, but is also the fastest means of transmission and the
most reliable at great distances. For countries lacking in huge capital
sources, this option may be unattainable even though a cost-benefit 55 ratio analysis would give this medium advantage over the others in the
long run.
Table 2.1 - Speeds and Cost of Communication Technology
Medium Factors in adoption of the technology
Speed Cost
Twisted Wire 300 Bps – 10 Mbps Low
Microwave 256 Kbps – 100 Mpbs Low
Satellite 256 Kbps – 100 Mbps Low
Fiber Optics 500 Kbps – 6.4 Tbps High
Source: Telecom Networks (2005).
Satellites
Despite the challenges of signal attenuation and transmission delay, satellites are the only technology capable of providing point-to-
point and point-to-multipoint coverage. Table 2.1 (page 55) shows that satellites are capable of a throughput between 256 Kbps to 100
Mbps at a relatively low cost. According to Hudson (1999), satellites are the most ideal for Africa because of the continent’s limited infrastructure, vast distances, and widely scattered population. To illustrate the critical role of satellites, the first meeting of government leaders and civil society leaders including the United Nations at the
World Summit on Information Systems (WSIS) in December 2003 in 56 Geneva identified the crucial roles that satellites play in international
development. Satellites are important for providing information and
communications backbone; bridging the digital divide; Universal
Access; broadband; low cost equipment; low cost connectivity; and
interconnection (Moore, 1998).
Satellites are used for voice and data, as well as broadcasting
applications. Hudson (1999) observed that Africa is best served by a
series of satellite applications that include thin route satellite earth
stations for voice and data transmission. For example, John Munsaka7 the Managing Director for ZAMNET Communications, Zambia’s biggest
Internet Service Provider (ISP) told the researcher that “with the advent of Very Small Aperture Terminals (VSATs), interactive data communications are made possible, so that an ISP in Zambia can uplink Internet traffic to a hub in Europe or the USA or even to another location within Zambia via satellite.” Further, he said, “a wide range of uses has emerged for VSATs in Zambia, such as electronic banking, hotel and auto reservations and credit card authorization” (personal communication, August 02, 2004).
Since 1998, the international community has pushed the Global
Mobile Personal Communication by Satellite Memorandum of
7 John Munsaka is a former lecturer in the School of Engineering of the University of Zambia. ZAMNET was the first ISP in Zambia. ZAMNET was created by the university in partnership with private sector investors. 57 Understanding (GMPCS-MoU), via the ITU, which encourages African governments to make use of small satellite VSAT installations to extend the reach of terrestrial telecommunications infrastructure. As a result of being a signatory to the ITU GMPCS Memorandum of
Understanding, Zambia created a VSAT accepting environment that resulted in increased private investment in VSAT technology.
The ITU describes GMPCS as a personal communication system providing transnational, regional or global coverage from a constellation of satellites accessible with small and easily transportable terminals. Whether the GMPCS satellite systems are geostationary or non-geostationary, fixed or mobile, broadband or narrowband, global or regional, they are capable of providing telecommunication services directly to end-users. GMPCS services include two-way voice, fax, messaging, data and even broadband multimedia (ITU, 2005).
Wireless
Wireless technologies provide huge benefits because of the sparse terrestrial infrastructure for telecommunications in Zambia.
Wireless Local Loop (WLL) systems are an attractive alternative to fixed wire line infrastructures that have been plagued by high maintenance costs and vandalism of copper cables. ZAMTEL is the only
Zambian operator with the authority to offer Wireless Local Loop
(ZAMTEL, 2006). The WLL technology comprises cellular networks; 58 personal communications services (PCS) and cordless PABX (Pauw,
1994).
Newer spread spectrum wireless local area networks (WLAN)
that conform to IEEE 802.11b (WiFi) and 802.16 (WiMax)
specifications also reduce the cost of local connectivity while increasing
the available bandwidth. The WiFi LANs are used in Internet hotspots
that are common in cybercafés, hotels and airports in the cities (Geier,
2001). The WiMax LANs that reach further afield are still in
development.
Fiber-Optics
As Table 2.1 on page 55 shows, fiber optic cables are the
favored medium for telecommunications purposes. According to
Flournoy (2004), fiber optics is the transmitting of information as light
(photonics) along flexible glass fibers. A single fiber glass strand has
the potential to transmit one gigabit per second or more of information
between headends and designated points within the service area
without frequent repeaters. This capacity allows for a 10-strand fiber
cable to simultaneously deliver nearly 500 high definition television programs.
Compared to the conventional copper wires which are abundant
in Zambia, Ajoy, Ghatak and Thyagarajan (1998) advanced that
optical fibers are less expensive in the long run because they have 59 higher carrying capacity, they experience less signal degradation and, unlike electrical signals in copper wires, light signals from one fiber do not interfere with those of other fibers in the same cable. This means that fiber enables clearer phone conversations and television reception.
A further advantage of fiber optics over copper is that signals in optical fibers degrade less, therefore, lower-power transmitters are required instead of the high-voltage electrical transmitters needed for copper wires. This, coupled with the fact that these flexible glass cables are virtually useless to copper wire vandals, will save the operators and consumers money.
Internet
Jensen (2003) noted that Zambia was the first country outside of
South Africa to obtain a full Internet Protocol (IP) link. This occurred in the mid-1990s. The initiative grew roots at the University of Zambia, which was the pioneering organization. The Internet has now empowered millions of Africans with the ability to share and retrieve knowledge. Zambia’s Internet subscribers number over 65,000 (Table
1.3, page 33), which is small compared to other African countries.
However, the number of Internet users is estimated at 70,000 due to the existence of telecenters (Malakata, 2005). 60 From Nationalization to Privatization
When Zambia gained its independence from Britain in 1964, the new government was determined to change more than the management of political affairs by expanding its functions into the economic sector as well. The Zambian government nationalized private businesses that, hitherto, belonged to corporations or individuals affiliated with the departing colonial government. According to Noll
(2000), three factors explained the broader historical circumstances surrounding nationalization in Zambia as well as other developing nations.
First, at the time that Zambia and other developing countries nationalized their industries, most developed countries still had state- owned infrastructural industries, a circumstance that survived into the
1980s (Snow, 1986). For example, the British and French telecommunications companies remained in government hands during that period. Despite the well-known inefficiency problems of state- owned enterprises, those monopolies did not appear to perform poorly nor did they prevent economic growth in Europe (Joskow, 1998). For the Zambian government, which desperately sought best practices in economic management, the above scenario was a justification for state involvement in the economic sector. 61 Secondly, during the nationalization era, the most salient political fact in most developing countries was resentment over colonialism. The violent, repressive, and exploitative history of colonialism framed many domestic issues in terms of the lingering effects of colonial rule. In Zambia, infrastructural industries were important, visible, and largely foreign-owned, and therefore, easily presented themselves as natural targets for anticolonial resentment.
Therefore, nationalization assisted in sweeping away the institutions of colonial influence (Noll, 2000).
The third factor, socialism, reached its crescendo as an ideology in the 1950s and 1960s. Socialism appeared to offer a viable alternative to Western market capitalism as a means to achieve long- term economic development. In Zambia, the new independent government adopted Humanism, a derivative of socialism (Noll, 2000).
Tanzania, to the north of Zambia, adopted Ujaama, another form of
African socialism.
Nationalization is an economic model where the government creates an active role for itself in the management of the economy. In
Zambia, this happened through two government edicts, namely; the
1968 and 1969 Matero and Mulungushi8 economic reforms, through
8 The economic reforms that ushered in nationalization of private industries in 1968 and 1969 are called Mulungushi and Matero Declarations respectively, derived from the venues at which the edicts were pronounced by the Zambia President. 62 which the Zambian government acquired control over twenty six
companies in the fields of wholesaling, retailing, transportation, and
manufacturing, followed by the acquisition of majority shares in
Zambian mining companies and financial institutions (Sakala, 2001).
Nationalization brought in revenues sufficient to create
parastatal companies under the Zambia Industrial and Mining
Corporation (ZIMCO) to hold the nationalized assets. ZIMCO was for
many years listed in Fortune magazine as among the worlds’ 500
largest corporations (Mwanakatwe, 1994). Figure 2.1 (page 63) shows
the chain of command in regard to the government’s supervisory role
throughout the economy. Chileshe (1986) revealed that over a brief period of time the government even created the Ministry of State
Participation, which combined the functions of several ministries with
those, performed by the Industrial Development Corporation
(INDECO), an affiliate of ZIMCO. The ministry was short-lived but the
government’s ownership of businesses expanded over the years.
Through out this structure, parastatal chief executive officers
were appointed by the Government, usually by the President himself,
or by the Minister of the line ministry. The Minister or a representative
sat on boards of companies so that government directions were
implemented. According to Mwanakatwe (1994), these appointments
and board positions led to inefficiency and misapplication of resources. 63 Figure 2.1 - Organization Chart of State Participation in the Economic Affairs of Zambia from 1968 to 1990
CABINET
Ministry of Trade & Industry Ministry of Finance
State Finance Development INDECO Limited Corp. (FINDECO)
INDECO group (50 companies) brewing; consumer trading; National Commercial Bank; engineering; building supplies; Zambia State Insurance Corp.; petrol chemicals; property; Zambia National Building rural enterprises; and Society; INDECO Industrial manufacturing Finance Co. (ex INDECO); J.H. Minet (ex INDECO)
Ministry of Mines and Mining development
MINDECO Limited
Roan Consolidated Mines; Nchanga Consolidate Copper Mines; Kafubu Emeralds; Ministry of Zambia Broken Hill Ministry of Information, Development; Ndola Lime; Information, Broadcasting Copperbelt Power Corp., Mines Broadcasting and Tourism and Tourism Air Services
National Transport Corporation National Hotels Corporation
Contract Haulage (ex INDECO); Country Hotels (ex INDECO) United Bus Company (ex Zambia Hotels Properties (ex INDECO); Zam-Tan Road INDECO) Services (ex INDECO)
Ministry of Provincial and Local Government and Culture
Zambia Housing Board Kafue Estates (ex INDECO)
Adapted from Chileshe, 1986. 64
According to Afeikhena (2002), most developing nations in Africa inherited colonial telecommunications infrastructure that was created only to serve the colonial governments, omitting the majority African populations. Therefore, owing to their limited network externalities, the telecommunications infrastructure had low capacities.
Nationalization of the telecommunications companies was partly premised on the idea that governmental control would lead to accelerated investments in the telecommunications sector. In the
1960s, most developing countries adopted the “dominant paradigm” for national development, which focused on infrastructural upgrades and huge capital projects.
However, after three decades of state management of these companies, as noted by Afeikhena (2002), most African governments, shown in Figure 1.5 (page 32), moved away from complete monopoly management of the telecommunications sector and implemented reforms that included privatization, liberalization and deregulation. The pressures for further sector reform were usually subtle, and emanated from domestic and external influences such as participation and membership in global forums and Multilateral Organizations who advocated for this route. 65 The benefits ascribed to reforms include: new and streamlined
management; infusion of capital from new investors (usually foreign investors); improved technologies; and incentives for new owners to
create service accessible by everyone by virtue of network
externalities (Noll, 2000). The external influences are attributed to
institutions such as the World Bank (WB) and International Monetary
Fund (IMF), who articulated Structural Adjustment Programs for
developing countries, aided by the World Trade Organization (WTO)
whose vision is to liberalize the global trade regime.
Multilateral Organizations and Domestic Policy
In the 1990s, the emerging literature on political and economic
reform was arguing that it was not feasible to understand the process
of reform in Africa without considering the powerful role played by the
international donor community (Brautigam 2000; Milner 1997; van de
Walle, 2001). The literature review indicates that much of the impetus
for the telecommunications restructuring that took place in Zambia
and other developing nations in the 1990s had its origins in activities
occurring in developed nations. A major factor was the example set by
the USA and Britain to deregulate their telecommunications sectors.
Busakorn (2002) argued that, in addition to the attraction of following
the deregulation moves of the western powers, specific pressures from 66 MOs such as the WB, IMF and WTO had significant impact on the way telecommunications industries in many developing countries were being transformed. These pressures, that Busakorn observed, are linked to an eclectic theory proposed by Dunning (1981) and to the
Berg report (1981).
The eclectic theory advises that developing nations create effective regulatory institutions; legal institutions that can handle large and complicated cases; and establish a competitive environment that will force incumbents to admit new comers. Achieving these milestones according to Dunning will ensure that businesses have specific advantages. For example, firms are guaranteed safety and are allowed to keep their profits. Also guaranteed are certain location specific advantages such as assuring that the country is stable and free from political and social upheavals (Dunning, 1981).
The “Berg report” named after its main author Elliot Berg, a development economist employed by the World Bank, was perceived to be applicable to occurrences in developing nations. The report drew insights from rational choice theory to evaluate developmental records of governments in sub-Saharan Africa. Its recommendations centered on the need for a greatly reduced role for the state in managing the economy and much greater reliance on the market as a means of accelerating economic activity, particularly the agriculture sector 67 (Berg, 1981). The World Bank and other bilateral lenders implemented
aspects of the report as part of the SAPs.
Technology Determinism
Many of the studies of information and communication
technology all over the world have been marked by a structural
approach that tends to place telecommunications in an independent
role as an unequivocal driver of positive change (Wilson, 1998;
Wolcott, Press, McHenry, Goodman, & Foster, 2001; Gebreab 2002;
Jensen, 2002). These studies are sometimes done at the expense of full appreciation for the role of society or social forces in determining
the social construction of ICTs. Such approaches tend to concentrate
on the macro-economic causes of ICT diffusion, such as GDP per capita and presuppose a straightforward, incremental roll-out of ICT
applications and services (Ayogu and Hodge, 2002; Beebe, Kouakou,
Oyeyinka, & Rao, 2003; Cogburn and Adeya, 2001; Cohen, 2003;
Janisch and Kotlowitz 1998; Lewis, 2005).
Technology determinism is firmly anchored in the perception that
ICTs open new opportunities for poor countries to advance rapidly to
modernization at the levels of developed industrial societies. Those
who subscribe to this mainstream perception tend to look at ICTs as
ends in themselves for bridging the information and development gap 68 between developed and developing countries. Not surprisingly, such studies put emphasis on the need to build basic infrastructure in the form of reliable telephone systems, satellite and microwave communications, and fiber optic lines. Additionally, the introduction of software and hardware is seen as a way to address the development blockages and reverse the trend of marginalization (Kenney, 1995;
Moyo, 1996). For example, the Zambian Communications Minister
Chambeshi said in a Post article “telecommunications is a tool that can help to achieve national and social goals.” He observed that for maximum benefit to be derived, the telecommunications system must be integrated in national and regional development sectors to include
“infrastructure, social services and agricultural and industrial development” (Post, November 11, 2005, p. 1).
The emphasis on infrastructure development is easy to support with evidence since the exponential increases in mobile telephone subscribers in Zambia and other developing countries can be measured. In order to maintain a sustained increase in subscribers, mobile telephone companies have expanded their networks’ coverage across the country, and continually introduce further value-added services aimed at satisfying subscribers. It is safe to say that the mobile telephony technology has attained maturity in Zambia. The technology determinism perspective measures maturity by the ever- 69 increasing number of subscribers and by the levels of service and capital input by service providers. However, Mansell and Silverstone
(1996) cautioned that technology itself is imbued with social processes that determine whether diffusion occurs or not.
According to Green (2001), social determinism, as opposed to technology determinism, accounts for ICT diffusion. The technology determinism perspective holds that the features of a particular technology determine its use, and the role of a progressive society is to adapt to, and subsequently benefit from the implementation of technology. Social determinism, advanced by Green, is premised on society’s responsibility for the development and deployment of particular technologies. In terms of political economy, technological determinism is aligned with the modernization paradigm, while social determinism is linked to the dependency paradigm because of the focus is on roll out and quantities in case of modernization, and the awareness of power relations in the case of the dependency paradigm.
Mackenzie and Wajcman’s (1985, 1999) research was perhaps the most instructive to underscore the dichotomy between technology and social determinism. Their collection of case studies of different technologies supported their argument that social circumstance was the vital ingredient in determining which technologies were adopted, and which were not. Their definition of social circumstance included 70 economics, politics, and the existing infrastructure. Mackenzie and
Wajcman pointed out that it was wrong to see any given technology as
something as inevitable as the law of gravity. For example, the duo claimed that there is no necessity that required computers to exist or
that – once they existed – that they must be connected to the Wide
World Web (WWW). Mackenzie and Wajcman concluded that the
reasons things developed as they did were not technological reasons
but social reasons.
Kopytoff (2001) utilized a similar “biographical” approach to
consider why a personal computer was bought, for whom and with
what ends in mind. This trajectory of intended use may well be at odds
with the pattern of use that developed, or that failed to develop. Such
discussion about the social and technological determinism was
instructive to the policy process in Zambia because as much as policy-
makers desired rapid diffusion of ICTs as a means to participate in the
global economy, measurement of both diffusion and participation may
be affected by determinants outside the scope of the current ICT
policy.
ICTs and Social Context
According to Green (2001), all changes in communication
patterns have complex social and cultural ramifications and eventuate 71 from complex social and technological forces. The complexity of
technology in the era of ICT convergence is particularly problematic for
policy-makers in developing countries such as Zambia, as they appear
to be a step behind the trends of ICT diffusion. The cornucopia of ICTs
is scary to some policy-makers and exciting to others. Green (2001)
further opines that the role of policy and regulation is to attempt to
minimize the undesired changes, such as increasing digital divide and
knowledge gaps, while getting the most out of the ICTs. Other theories
are relevant in the debate about effects of the ICTs. For example,
communication scholars Tichenor, Donohue and Olien (1970) were
able to show through the Knowledge Gap Theory that educated people
were likely to gain more information and apply it than less educated
people. They also posit that the assimilation of information will keep
increasing in educated people and minimally increase in the uneducated. According to Bonfadelli (2002), the conclusions from that study by Tichenor et al. in the 1970s are still applicable today as evidenced in Internet users, where the knowledge gap inevitably creates a class difference dividing people of the world into the information-rich and information-poor.
Green (2001) concludes that access to technology does not
necessarily lead to its use, and information does not necessarily fuel
self-empowering activity. This finding is significant because it debunks 72 the popularly held views that ICTs are neutral, instantly beneficial and subsequently lead to an increase in knowledge. Despite the easy access to ICT services in many countries, they may still be unaffordable to ordinary people. The cost of ICT services is a challenge in developing countries, as people tend to have little disposable income. Zambia’s US$308 per capita income (Table 1.1, page 15) is an example. Green further observes that citizens of developing countries whose current poverty has its genesis in the exploitation carried out by former colonial powers, resist to adopting ICTs that come from former colonial nations. Therefore, social determinism, which Hamelink (1999) successfully linked to the de-localization influence of Multilateral
Organizations, is summarized as follows:
Whether the potential to support social development will be
realized depends much more on the institutional environment of
the technology than on its technical features per se. Therefore
analysis of the relation between ICTs and social development has
to give ample attention to their policy context…it is increasingly
the international policy context that takes precedence over all
others, influencing even the effectiveness of action at the local
level. If, for example, local communities want to retain an
autonomous space for cultural policy-making, their strategies
must extend beyond local boundaries, since their chances of 73 success will be affected by such global policies as World Trade
Organization’s (WTO) decisions on trade in services or
intellectual property rights (Hamelink, 1999, p.1).
The analysis by Green (2000) and Hamelink (1999) creates awareness
of the context in which developing nations create ICT policy. The MOs
de-localize this context by creating an environment within their structures through which developing nations adopt ICT policy. The following literature traces the development of telecommunications sector reforms cognizant of Mozambique and Nigeria’s participation in the global forums.
Comparative Country Analysis
Nearly all African countries implemented telecommunications
sector reforms, represented in Figure 1.5 (page 32). Models and
motivations for restructuring were as unique as the number of
countries. Singh (1999) observed that, in general, the most common
rationale for restructuring was a combination of remedies to failing
economic conditions, assuming that cheaper new technologies could
lower entry costs, and the realization that telecommunication services
were significant as a service to banking, finance, travel, tourism,
distribution networks and media. 74 This section contextualizes the economic legacies that new
political actors in Nigeria and Mozambique confronted when they
gained independence. The nationalistic, modernizing, and socialist
ideological agendas of the new governments and the implementation
of policies that both reflected and compromised those agendas are
analyzed. The trajectories of the two countries were different.
However, some similarities are observed in the manner that these
countries and Zambia reoriented their economies from a command
economy to a capitalist one, and the political reconfiguration during the 1990s from highly interventionist states with multiple roles to less
visible roles. The two countries represent nations during the last
decade that saw a need to implement policy reforms.
Nigeria
The history of Nigeria is similar in many aspects to that of
Zambia. Both Nigeria and Zambia were colonized by the British and
gained independence around the same time period. Nigeria gained
independence in 1960 and Zambia in 1964. Both countries adopted
British systems of management of public affairs including management
of its telecommunications sector. For example, their radio broadcasting
companies where modeled after the British Broadcasting Corporation
(BBC) (Banda, 2003). Like Zambia, forty percent of Nigeria’s 75 international telephone traffic was with the UK, which had a long- standing historical and economic bond with Nigeria (Ajayi, Salawu, and
Raji, 1999). After gaining independence, both countries nationalized formerly private industries to create government-owned parastatals motivated by what Noll (2000) describes as anticolonial resentment.
Deep differences between Zambia and Nigeria emerged when successive military dictatorships took power in Nigeria.
Nigeria’s telecommunications sector was dominated by
government-owned monopolies until recently when control shifted
from government to private sectors. A faltering economy, pressure from external interests such as global investors, and international
lending agencies such as the IMF and the World Bank, led the
government to reform the telecommunication sector during the 1990s
(Faruqee, 1994; Friedman, 1994 and Onwumechili, 1996).
History of Nigerian Telecommunications
Nigeria has perhaps the oldest telephone system in Africa.
According to Ajayi et al. (1999), the development of
telecommunications in Nigeria began in 1886, when a cable connection
was established between Lagos and the colonial office in London. By
1893, government offices in Lagos were provided with telephone service, which was later extended to the hinterland. 76 Ajayi et al. (1999) observed that during pre-independence the main transmission medium was unshielded twisted pairs of copper wire. Small to medium capacity over-the-air transmission systems employing VHF and UHF frequencies were introduced around 1955.
The first serious attempt at planning telecommunications services in the country was just before independence between 1955 and 1962.
Cable and Wireless, a colonial private company of the United Kingdom, wholly owned the telephone services in the pre-independence period.
The Nigerian government acquired fifty one percent of the company in
1962, and by 1972 had taken over the remaining forty nine percent.
The nationalized company was called the Nigeria External
Telecommunications (NET) Limited (Ajayi et al., 1999, Afeikhena,
2002).
Development Planning in Nigeria
Like most African nations at independence, Nigeria did not have enough educated human resources to manage the nation’s essential sectors; therefore, the country prioritized development plans that were usually designed for immediate impact on specified sectors for specified periods. Telecommunications improvements in Nigeria were featured in every five-year development plan. According to Ajayi, et al., (1999), some milestones in the development of 77 telecommunications were achieved in the First Development Plan
(FDP) after independence which led to the establishment of Nigeria
External Telecommunications (NET) Limited and expansion of the telephone network. Ajayi et al. (1999) reported that the FDP was perpetually disrupted by chronic under-funding and by the Nigerian
Civil War of 1967 to 1970. However, the Second and Third
Development Plans where implemented in 1970 to 1975 and 1975 to
1980 respectively, and during that period, fixed telephones lines expanded from 52,000 to 241,000; telex lines from 874 to 4,950; and the Nigerian Domestic Satellite (DOMSAT) earth station was erected.
Despite the successes, Ajayi et al. (1999) opined that rapid expansion resulted in unintended consequences such as the proliferation of incompatible technologies installed in the network that made the procurement of replacement parts difficult. Additionally, with complicated manpower training needs, there was a shortage of technical expertise to operate and maintain the network and execute expansion projects.
In the Fourth Development Plan (1980-1985), several previous
projects were completed. The most significant development of this
period was the 1985 creation of the Nigeria Telecommunications
Limited (NITEL), a merger between the telecommunications arm of the 78 Department of Post and Telecommunications and NET (Ajayi et al.,
1999).
Afeikhena (2002) reported that by 2002 routine planning in
Nigeria was being done as part of the privatization program that
gained momentum with the adoption of Structural Adjustment
Programs (SAP). The Technical Committee on Privatization and
Commercialization was established in 1988 to implement the privatization of state owned business, which in addition to NITEL included public utilities like the Nigerian Postal Services, Nigerian
Airways and the Nigerian Electric Power Authority. Afeikhena advanced
the hypothesis that under SAP, NITEL became a major component of
economic reform. The Nigerian government with assistance from the
IMF and World Bank valued NITEL at over $2 billion for privatization
purposes, but the privatization exercise faced resistance from NITEL
managers and unions. The Nigerian government was unperturbed by
the resistance and passed the management of the company to
Pentascope, a Dutch consortium (Ajayi et al., 1999).
Regulation of Telecommunications in Nigeria
The Cable and Wireless Act of 1962 established the Ministry of
Communications as the regulatory body for all telecommunications in
Nigeria (Ajayi et al., 1999). The mode of telecommunications 79 regulation in Nigeria was similar to that of other African countries
where the governments both regulated the industry and operated the
monopoly utilities that provided services. In Nigeria, the regulation
resided with the federal Ministry of Communications until the early
1990s when the government was forced to issue several decrees to
liberalize the industry. There were several factors for the change in
regulation structures, but the most significant was the critical 1990
World Bank decision to suspend a $225 million telecommunications
loan to the country citing Nigeria’s continued military dictatorship. The
World Bank demanded that Nigeria strengthen the telecommunications
policy framework, commercialize NITEL and improve access to
telecommunications service (Ajayi et al., 1999).
Following these demands, the government decreed key
regulatory instruments that were designed to reform the market. The
Nigerian Broadcasting Commission (NBC) Decree No. 75 was
promulgated in 1992 to regulate broadcasting and establish the
broadcasting regulatory commission. The NBC handles matters
connected with mass communication and technical aspects as they
relate to broadcast frequency bands for radio and television. The
Nigerian Communications Commission (NCC) also regulated other
telecommunication applications not covered in the NBC Decree, such
as 80 licensing telecommunications operators,
ensuring the improvement of Nigerian telecommunications
penetration,
establishing and supervising technical and operational standards
and practices for network operators,
overseeing the quality of service provided by operators,
setting terms for the interconnection of carrier networks,
Ensuring that the interests of telecommunications consumers are
protected by providing competitive pricing and guarding against
abuse of market power (Afeikhena, 2002).
The country proceeded to harmonize the telecommunications sector with the creation of the Nigeria’s Telecommunications Policy
(NTP), which was finalized in 1999. The policy promised Universal
Access through minimum rollout franchise obligations, where operators are obligated to offer service to underserved areas as part of the license agreement, community telecenters development projects, and open market entry in underserved areas, encouragement of new entrants and competition, and increase in private sector participation
(Onwumechili, 2003). According to Ajayi et al. (1999), a company must be either owned by a Nigerian citizen or be registered in Nigeria to participate in the Nigerian telecommunications sector. The Nigerian
Communications Commission hoped that this requirement would 81 encourage joint ventures between foreign companies and Nigerian
companies.
Sector reforms had immediate impact. In 1991, there were
450,000 direct exchange lines representing a 1 in 250 teledensity against the ITU’s recommendation of 1 line per 100 persons for developing nations (Afeikhena, 2002). Aragba-Akpore (1999) reported there were 600,000 phones lines for a 10 million people wait list in
1998. After licensing GSM providers in 2001, phone access jumped to
one million subscribers within a year and the cost of handsets reduced
from $600 in 2000 to $160 in 2001 (Onwumechili, 2003).
Structure of Nigeria’s Telecommunications Sector
Figure 2.2 (page 82) shows the hierarchy of control in Nigeria’s
telecommunications sector. Policy issues are handled by the Ministry of
Communications, which appoints the Board of the independent
Nigerian Communications Commission (NCC) and represents the
country at the ITU and other international forums (Ajayi et al., 1999). 82 Figure 2.2 - The Organization of the Telecommunications Sector in
Nigeria. Adapted from Afeikhena (2002).
Ministry of Policy-making level Communications
Nigerian Regulatory level Communications Commission (NCC)
NITEL and other Provision of services telecommunications services operators
Joint ventures and new Complimentary and entrants value added providers
Other Players in Nigeria
Non-telecommunications companies such as the Nigerian
National Petroleum Corporation (NNPC) helped to accelerate network expansion. The NNPC installed a cross-country high capacity digital communication system for its pipeline operations. The system 83 comprises microwave and optical fiber in hybrid configuration. The
network capacity is leased to major oil companies –Shell, Chevron,
AGIP and ELF - to connect their oil fields with regional bases and
computer centers (Ajayi et al., 1999).
Nigeria is active in regional organizations such as the Economic
Community of West Africa States (ECOWAS) and the African Union
(AU). They participate in meetings to discuss technical issues involved
in planning, operating and designing telecommunications systems
suitable for use in Africa’s environment.
Mozambique
Zambia and Mozambique are neighbors, sharing a 419-kilometer
long border area. Mozambique’s contemporary history is different from
Zambia’s. However, the political economies of the two countries bear
some similarities.
Mozambique gained its independence from Portugal on June 25,
1975 after a protracted ten-year guerilla war. The non-African, mainly
Portuguese, minority population had staffed the professional ranks in
the government, and the industrial and commercial sectors numbering
about 250,000. At independence, when the Portuguese left the
country, they engaged in what was described as a “scorched earth”
policy because they dismantled as much infrastructure and took away 84 as much capital assets as they could. Their departure left the country without staff trained to operate the transport system, factories, retail and wholesale trade, and telecommunications operations. Few
Mozambicans had been educated to enter government or other occupations. As a result, picking up from where the Portuguese left off was a difficult task (Landau, 1998; Sundelin, 1998).
The country was soon plunged into a civil war between the ruling
Frente de Libertacao de Mozambique (FRELIMO) and Resistencia
Naçional Mozambicana (RENAMO), a rebel group that had been formed and supported by the Rhodesian and South African intelligence services (Landau, 1998; Gallagher and Whiteside, 1989). The conflict led to destruction of economic and social infrastructure and massive population displacements.
While Zambia never had civil wars, both Zambia and
Mozambique did nationalize their private industries and implemented a socialist oriented economy. Consequently, their declining economies led their governments to seek loans from the World Bank and IMF.
When Mozambique joined the World Bank and IMF in 1984, the country was in the midst of its third consecutive war (Landau, 1998).
The Multilateral Organizations quickly prescribed Structural Adjustment
Programs (SAPs) to correct some of its economic problems. Zambia and Mozambique both liberalized their telecommunications sectors, set 85 up independent regulatory structures for their telecommunications sectors and embarked on privatization of government-owned companies.
History of Mozambican Telecommunications
Telecommunication services were introduced in Mozambique as early as 1908 and were managed by the Portuguese colonial rulers until 1975. The transition from a centrally planned to a more market- oriented economy began during the 1980s. In 1981, the government separated the postal and telecommunications services, thus creating the Empress Naçional de Telecomunicaçoes de Moçambique (ENTM) under the direction of the Ministry of Communications to provide telecommunications services. This was bold by regional standards as most countries still believed in huge utility companies, with their economies of scale, to provide a variety of services including Universal
Service (Sundelin, 1998).
The Law 17/91 of August 3, 1991, introduced a new legal system that led to profound changes in the management of government owned companies. The law required modifications of the articles of association for government-owned companies, which were to be transformed into public companies. The law led to the transformation of ENTM to Telecomunicações de Moçambique (TDM), as an 86 autonomous government-owned company obliged by law to keep the public telecommunications network open to all users. TDM was also mandated to insure Universal Service (Fernandes, 1994).
Development Planning in Mozambique
According to Pitcher (2002), in the 1960s and 1970s scholars of different political persuasions accepted the role of the state in the economy and the necessary connection between state intervention, modernization, and development. In the decade after widespread independence of African countries, scholars as well as government officials anticipated that states would promote growth and foster development, bring unity, and solidify the nation. Those who espoused modernization expected the government to be the mechanism that would hasten their economic and social development. For Mozambique, developing planning was urgent because the government was bankrupt at independence. Despite the urgency, it took the government nearly five post independence years to finally draw up a development plan.
The government launched an overly ambitious 10-year development plan called Plano Perspectivo Indicativo (PPI) in
December 1981 under the oversight of the National Planning
Commission (NPC). The theme was “Decade for the Victory over 87 Underdevelopment.” The plan had as much as 5 percent of the nation’s
GDP dedicated to infrastructure development including the telecommunications sector (Tarp and Lau, 1998). Soon after
Mozambique joined the World Bank in 1984, Bank staff also provided technical policy advice that was critical for the design of the country’s policy agenda. The government of Mozambique pursued its reform agenda without significant reversal of either the strategic purpose or any major component. As a result, the country had favorable donor confidence and support, resulting in high aid inflows. In 1994, the
World Bank shifted toward a more decisive course of privatization of government owned enterprises (Landau, 1998).
Regulation of Mozambican Telecommunications
The Instituto Naçional das Comunicaçoes de Moçambique (INCM) was established as an independent regulatory body under the umbrella of the Ministry of Communication and Transport (MCT) in 1992. The
MCT is responsible for the general policy directions. The INCM was created to assist the Government in coordinating, supervising and planning the telecommunications sector. Specific roles of INCM include: formulation and interpretation of sector policy; licensing and regulating service providers and radio frequency spectrum users; defining performance targets and indicators; and handling of relations 88 with international and regional telecommunications organizations
relating to treaties and policy matters (Fernandes, 1994).
The government-owned telecommunications monopoly TDM was transformed into a publicly owned business firm by Decree No. 23/92, on September 10, 1992, as part of the larger economic reform underway in Mozambique. TDM was corporatized to function as a commercial entity with financial autonomy, and it has responsibility for planning, installation and operation of both the national and international networks. The major services offered by TDM are telephone/fax, telex, leased lines, radio and television transmissions, cellular telephones (GSM) and Internet services (Telecommunicacoes de Mozambique (TDM), n.d.).
The Direçao de Informaçao (DI) regulates television and radio in
Mozambique. The radio and television companies get their operating
licenses from the Direcçao de Informaçao and their radio-frequency
license from INCM. At the moment, the biggest competition in
television is between the state television network, Televisao de
Moçambique (TVM), and the private broadcasting organization, Radio e
Televisao Klint (RTK), each of them operating only one channel. In
radio, the biggest competition is between the state-run Radio
Moçambique (RM) and privately owned RKT and Radio Miramar (TDM,
n.d.). 89 Structure of the Mozambican Telecommunications Sector
Figure 2.3 (page 90) shows the structure of the Mozambican telecommunications sector. MCT has policy oversight while INCM regulates the industry. Government officials are active on company boards. For example, the Minister of Planning and Finance sits on the
Board of Telecomunicações de Moçambique (TDM), and he chooses the
TDM’s managing director. According to Pitcher (2002), TDM is well run and makes its accounts public, turn profits and is fairly responsive to the demands of those consumers who can pay for their services.
90
Figure 2.3 - The Organization of the Telecommunications Sector in Mozambique.
Ministry of Transport Policy-making level and Communications
Instituto Naçional da Regulatory level Comunicaçoes de Moçambique (INCM)
Telecomunicacoes de Government owned Mozambique (TDM) monopoly services provider
Joint ventures and Private businesses value added providers and subsidiaries of TDM
Other Players and Partners in Mozambique
According to Pitcher (2002), the increased influence of international institutions such as the World Bank and the IMF, and the widespread implementation of privatization policies in Mozambique all indicate that regional and international factors have influenced the 91 political choices and economic outcomes. Tarp and Lau (1998)
observed that the macroeconomic attempts to stabilize the economy
produced liberalization and reductions in centralized administrative
control of the public sectors. Thus, the break up of the post and
telecommunications company into two distinct companies was
necessitated by these demands.
ITU was also instrumental in the preparation of the TDM Master
Plan covering the period from 1991 to 2010 which Fernandes (1994)
thought would strengthen engineering and planning capabilities of the
company.
Mozambique is indeed unique because most of the foreign
support to its telecommunications sector during the 1990s came from
one outside source: the Swedish International Development Agency
(SIDA). SIDA had a considerable impact because it supported areas that gave long term results. This support focused on institutional
development, investment coordination, education and training within
the telecommunications sector (Sundelin, 1998).
General conclusions
There are common elements in Mozambique and Nigeria’s
reforms, namely, the incumbents were each state-controlled monopolies and in each case a politically strong government committed to deregulation pushed through radical reforms. The two 92 country examples are models of telecommunications sector reforms that took place during the late 1980’s and early 1990’s. During this time, developed countries such as the United Kingdom and the United
States of America also embarked on massive deregulation of their telecommunications industries. Its architect, Prime Minister Margaret
Thatcher, called the British approach “entrepreneurial mindset”
(Sterling et al., 2006). The developing world was not too far behind in restructuring, including privatization of state owned businesses and liberalization, which moved towards more open environments allowing for competition, reduced barriers to entry and transparent deregulation. 93
Chapter Three – Theoretical Framework
Communications Research and Political Economy Paradigms
This chapter describes the theoretical framework for analysis of
Zambia’s ICT policy process and the influence of Multilateral
Organizations. The theoretical framework includes modernization and
dependency theories, which form the core of political economy discourse.
In approaching this topic of political economy, the author found
a range of literature on Multilateral Organizations and policy issues
from fiscal and monetary policy to trade policy reform, and from
privatization to regulatory reform that applies to the Zambian
situation. Confronted with this complexity, a strategy for simplification
was needed. In this dissertation, attention is paid to ICT policy reform
as it relates to domestic social preferences. This approach sees policy
reform as requiring institutional and administrative changes that
ensure that ICT policy-making is decisive, efficient and credible over
the long run.
Robbins (1963) defined economics as ''the science, which studies
human behavior as a relationship between ends and scarce means that
have alternative uses’’ (p. 16). Since economics is the study of the
optimal use of scarce resources, political economy commenced with 94 the study of economic and political behaviors and is concerned with
how politics affect economic choices in a society. Political economy in
anthropology and sociology is used to refer to neo-Marxian approaches such as development and underdevelopment set forth by Andre
Gunder Frank and Immanuel Wallerstein.
Theoretical Perspectives
Political Economic Paradigms
The main focus of this research is the role of Multilateral
Organizations in the ICT policy reform process in Zambia. Throughout
the policy process, local legislators and other policy-makers asked
important questions of these outside institutions. As described by the
British sociologist Anthony Giddens (1991), their questions were about
social relation issues such as who benefits and loses from the
introduction of these ICTs. According to Morales-Gómez and Melesse
(1998), policy-makers were concerned about how ICTs might be made useful and meaningful to the poor majority struggling to meet their basic needs. Zambia’s per capita income is $308 (Table 1.1, page 15).
What are the social and cultural opportunities and risks ICTs present and how can Zambia meaningfully adopt these technologies while lessening their undesirable social and cultural consequences? (Morales-
Gómez and Melesse, 1998). 95 The neo-liberal approaches of Multilateral Organizations are
contrasted within the discussion about modernization and dependency
theories, which are two of the most important theoretical paradigms
for analyzing Zambia’s ICT policy process. The reason is that
ultimately adoption and use of ICTs hinges on perceived ownership of
the process as well as the technology. The rationale for modernization
and dependency paradigms as analytical tools is based on the premise
that policy and legal frameworks have a key influence on economic
growth and social development.
Modernization Paradigm
The modernization approach is to promote communication as a
hierarchical channel for the transmission of information while avoiding
reference to the content or context of communication processes.
Schramm (1963) promoted a modernization view that included a
link between the mass media (itself a form of ICT) and national development. He observed that information and communication technologies satisfied commercial interests that could complement the economic development goals of the nation-state. Schramm’s writings
were some of the earliest references to information and
communication media as factors of economics, and continue to be a
point of departure for the analysis of ICTs’ role in economic 96 development. Critics say Schramm’s view of the role of
communications is simply a case of linear cause and effect. He thought
mass media were “magic multipliers” for disseminating information to
a diverse public within a short period of time (Huesca, 2001).
The modernization paradigm developed in Western countries
after the Second World War. In the 1950s and 1960s there was a
paradigmatic consensus that growth strategies were universally
applicable, a consensus best articulated by Walt W. Rostow (1960) in
his book, The Stages of Economic Growth. In this paradigm,
development was seen as social change that arose from the
introduction of new ideas into a social system to produce higher per
capita incomes and higher levels of living (Singhal and Sthapitanonda,
1996). The modernization scholars posit that social advancement and
economic development ought to be measured in terms of acquisition of skills and infrastructure. This model of economic growth pays relatively little attention to the question of distribution of wealth. Its primary concern is on efficient production and assumes that the market will allocate the rewards of efficient production in a rational and unbiased
manner. This assumption may be valid for a well-integrated, economically fluid economy where people can quickly adjust to economic changes (Ferraro, 1996). 97 In their attempt to understand the origins of poverty and
underdevelopment, modernization theorists tend to focus on deficiencies in the poor countries, such as the absence of democratic institutions, capital, technology and initiative and use these as ways to speculate about how to repair those deficiencies.
Modernization paradigm is actually a synthesis of several theories and approaches. Most important for this analysis are Max
Weber’s theories of social and economic change and Parson’s approach to functionalist theory. Between them, Weber and Parsons extrapolated that economic development occurred through industrialization, imported capital intensive technology and centralized planning and that a change in one part of society should create change in another, hence the trickle down approach (Singhal and
Sthapitanonda, 1996). The trickle down principle may be at play today when the MOs appear to be prodding less developed countries to buy into the ICT revolution.
According to Keohane and Nye, Jr. (1998), modernists in the
1970s saw ICTs as creating a global village and believed that non- territorial actors such as multinational corporations, transnational social movements, and international organizations were eclipsing the territorial state as prime movers of capital and technology. In attempting to create a cause-effect relationship between technology 98 and economic growth, the modernists moved too directly from
technology to political consequences without sufficiently considering
the continuity of beliefs, the persistence of institutions, or the strategic
options available to national governments. They failed to analyze how
holders of power, whether national governments or MOs, could wield
that power to shape or distort patterns of interdependence that cut
across national boundaries.
The modernization paradigm was criticized for over-emphasizing
domestic factors impacting economic development and underplaying the influence of external factors. A further criticism was that of the
paradigm's ignorance of the imbalance of global power relations
between richer and poorer nations (Busakorn, 2002).
Dependency Paradigm
Dependency theory developed in the late 1950s under the
guidance of the Director of the United Nations Economic Commission
for Latin America (UNCLA), Raul Prebisch. Prebisch’s argument was
that economic growth in the advanced industrialized countries did not
necessarily lead to growth in the poorer countries. His studies
concluded that economic activity in richer countries often led to serious
economic problems in the poorer countries. Such a possibility was not
predicted by neoclassical theory, which had assumed that economic
growth was beneficial to all even if the benefits were not always 99 equally shared (Ferraro, 1996). Osvaldo Sunkel (1969) defined
dependency as an explanation of the economic development of a state
in terms of the external influences –political, economic, and cultural—
on national development policies.
Prebisch’s initial explanation for the phenomenon was very
straightforward: poor countries exported primary commodities to the
rich countries who then manufactured products out of those
commodities and sold them back to the poorer countries. The “value added” by manufacturing a usable product always cost more than the primary products used to create these products. Therefore, poorer countries would never be earning enough from their export earnings to pay for their imports. His solution was similarly straightforward: poorer countries should embark on import substitution so that they need not purchase the manufactured products from the richer countries
(Ferraro, 1996).
The dependency school of thought is an antithesis to
modernization because it emphasizes the role of external factors as
determinants for conditions in the developing countries. As a counter
to the modernization paradigm, dependency theorists assert that
economic growth in the industrialized countries created third world
poverty in its wake. The argument is not simply that the third world is
poor in comparison with the industrialized world; rather, the 100 development of an industrial system in Europe and North America
fundamentally changed and impoverished most societies in Asia, Africa and Latin America (Isbister, 1998).
Most dependency theorists regard international capitalism as the
motive force behind dependency relationships. Andre Gunder Frank
(1972), one of the earliest dependency theorists, is quite clear on this point. He advanced that historical research demonstrates that
contemporary underdevelopment is in large part the product of
economic and other relations, past and continuing, between
underdeveloped9 and developed countries. Dependency theorists see the World Bank and Breton Woods institutions as an essential part of the capitalist system and evidence of the rich countries sucking
resources out of the third world. They fault these international financial
institutions for imposing policies on the third world that are favorable
to the rich countries (Isbister, 1998).
Theotonio Dos Santos (1971) emphasizes the historical
dimension of the dependency relationships in his definition. He
advanced that the poor state of African economies was a direct result of a
9 Underdevelopment refers to a situation in which resources are actively used, but used in a way that mostly benefits dominant states. A case in point, advanced by Prebisch, is the production of cheap raw materials from the developing countries, which are turned around as expensive finished products in the industrialized countries (Ferraro, 1996). 101 historical condition which shapes a certain structure of the world
economy such that it favors some countries to the detriment of
others and limits the development possibilities of subordinate
economies…a situation in which the economy of a certain group
of countries is conditioned by development and expansion of
another economy to which their own is subjugated (p. 228).
This view, which is grounded in neo-Marxist thought, holds true when the exchange of goods and services is unfavorable to the developing nations. Neo-Marxists theorists viewed the persistent poverty as a consequence of capitalist exploitation. And a body of thought pioneered by Immanuel Wallerstein, called the world systems approach, argued that the poverty was a direct consequence of the evolution of the international political economy into a fairly rigid division of labor, which favored the rich and penalized the poor
(Wallerstein, 1976).
Dependency theory is not a unified theory because it is comprised of three main arguments advanced by liberal reformers
(Prebisch), the Marxists (Andre Gunder Frank) and the world systems theorists (Wallerstein). However, the foundation principles of dependency theory emphasize the lopsided relationships between the dominant and dependent, the center and periphery, and the metropolitan and its satellites. It is on these tenets that the theory of 102 political economy concerning communication in developing countries
largely draws its connection to theories of dependency.
Dependency scholars suggest that the international diffusion of
ICTs is in great part a function of the international regime10 that
provides means through which an innovation spreads from the
technological center of developed nations outward toward the
periphery of developing nations. This perspective calls attention to the
dysfunctional, unbalanced and detrimental relationships that
developed between the center producers and the consuming
periphery. Roche et al. (1996) suggested that the international
Multilateral Organizations, such as the World Bank, WTO and IMF, play
a critical role in promoting the international diffusion of technology
from center to periphery, particularly in cases where market forces are
ineffective and/or undeveloped.11 The history of development is
littered with projects and technologies that were sponsored by these
Multilateral Organizations that ended up creating dependencies on
foreign producers while expanding markets only for societies with the
means of production (George and Sabelli, 1994).
10 The international regime theory defined by Stephen D. Krasner (1983) and applied to telecommunications by Peter Cowhey (1990) complements political economy considerations and contributes to the theoretical framework for examination of agency and power relationship in policy decisions by national and international stakeholders. Krasner defined international regime as “sets of implicit or explicit principles, norms, rules and decision-making procedures around which actors’ expectations converge in a given area of international relations”(p. 2). 11 Undeveloped simply means that resources are not actively used on a scale consistent with their potential (Ferraro, 1996). 103 Globalization
Globalization as a political phenomenon adds another dimension
to the discussion about MOs, ICTs and developing nation policy
choices. When African nations appear to be undergoing ICT policy
reforms, according to Cerny (1995), it is often a reaction to
globalization because the playing field of domestic policy environments
is determined not within insulated relatively autonomous and
hierarchically organized states; rather it derives from a complex
congeries of multilevel interactions between multilayer institutions
within and outside the state boundaries. According to Tabb (1997), the
globalization hypothesis asserts that there has been a rapid and recent
change in the nature of economic relations among national economies,
who have lost much of their distinct claim to separate internally driven development, and that domestic economic management strategies have become ineffective to the point of irrelevance.
Internationalization is, in this view, seen as a tide sweeping over borders in which technology and irresistible market forces transform the global system in ways beyond the power of anyone to do much to change. Transnational companies and global governance organizations, such as the World Bank and the IMF, enforce conformity on all nations no matter their location or preferences. 104 Although this dissertation does not focus on globalization per se,
its mention is warranted. Globalization has been defined by
Featherstone (1990) as “the increase in number of international
agencies and institutions, the increasing global forms of
communication, the development of standard notions of citizenship,
rights, and conception of humankind” (p. 6). Featherstone expands
this point, arguing that globalization also refers to the proliferation of
international institutions and their influence in global affairs, which
include influence on the policy reforms of individual nations.
The above perspectives do not represent a departure from the
global village concept envisioned by Marshall McLuhan and Quentin
Fiore (1968) when they posited that electronics and automation make
mandatory that everybody adjust to the vast global environment as if
it were his little home town. New communications media deliver images of McLuhan village-like encounters, but on a faster and more
global scale. Giddens (1991) noted that globalization was “the
intensification of world wide social relations which link distant localities in such a way that local happenings are shaped by events occurring
many miles away and vice versa” (p. 64). What Featherstone,
McLuhan and Giddens perhaps did not consider was the role of
Multilateral Organizations in influencing the form and content of the
policy initiatives that are happening across the world. 105 The above paradigms indicate a tension between the need to adopt ICTs for development, and the underlining issues of power relations as far as content creation, manufacturing capacities and overall access to ICTs are concerned. The next chapter discusses the methodology and specific procedures used in the data collection and analysis in this research.
106
Chapter Four – Research Objectives and Methodology
This chapter describes the research objectives, procedures and methodology applied in this dissertation. The chapter discusses data collection, sampling and data analysis.
Research Objectives
By presenting Zambia as a case study, the author hopes that this research will contribute to scholarly interest in and research on the broader issues of ICTs in developing countries. There has been a lack of research on the interactions between Multilateral Organizations and
Zambia specifically applied to ICT policy. Therefore, this dissertation presents an opportunity to better understand the state of knowledge about the ICT policy process in the developing world.
In terms of the significance of this study ICTs have far reaching implications in that they are central to the communication of political and cultural values as well as contribute to the economic and social development of all societies. This research is framed in terms of the theorized relationship between Multilateral Organizations and local government agencies as they decide what ICTs are diffused, for what purpose and by whom. 107 Research Procedures
The researcher used several ways to gather, analyze and discuss
findings, including both qualitative research and secondary analysis
methods (Hsai, 1988). These methods were used to analyze selected
records of the distant past and those of more recent periods. As a form
of logical inquiry, empirical studies were utilized that offer various
levels of generalization to describe, interpret or explain collections of
data.
The qualitative research methods followed non-probability
samples and interviews. A three tier sampling system was employed.
The first step developed and led to the creation of a convenient
sample. This sample was instrumental in locating the significant
interviewees in both the World Bank and in Zambia. A purposive
sample was selected for in-depth interviews. A snowball sample was
used to identify those chosen for in-depth interviews (Berg, 2001).
The target group was interviewed using a semi-structured
interview schedule. The approach was flexible and allowed the
interviewer to seek clarifications and do follow-ups on responses. The
set up for interviews was often informal because that was necessary to
establish rapport with the interviewees. Data organization within the
interviews consisted of taped interviews whenever interviewees accepted that. Field notes were taken in addition to taped interviews. 108 Interviewees pointed to primary sources, especially official
documents that included text about the communication technologies
and media legislation, policy speeches and government and
consultancy reports pertinent to the study. For example, semi-official
consultancy reports were sometimes used as advice papers to the
government agencies. Press releases, newspaper articles, and official
reports were also consulted.
The secondary sources included books, specialized journal
articles and official documents of organizations and the Zambian
government. Secondary analyses were used to further analyze the
collected data to draw interpretations, conclusions, or explanatory
information, additional to or different from those presented in the first
reports (Hsai, 1988). The selected methodology highlighted
sociopolitical systems of Zambia’s history by examining the
relationship between Zambia and Multilateral Organizations since
1964.
The officials of the Ministry of Communications and Transport
(MCT) and the Communications Authority of Zambia (CAZ) were
especially helpful in completing this study. They provided assistance in
identification of potential interviewees and helped make arrangements for interviews. A significant number of interviewees had email, which made communication easy both before and after the interview. 109 Data Sources and Collection
Personal interviews were the primary source of data collected in
Zambia between July and August of 2004 and again between July and
August of 2005. Additional interviews where conducted in January
2006. Primary data in Washington D.C. was collected during March and
June of 2005. A list of interviewees was compiled using the criteria discussed above before the start of the field research. Additional interviewees were suggested to the author during consultations in
Zambia and in Washington D.C. (The list of interviewees is attached as
Appendix F). All interviewees had either a direct involvement in ICT policy issues at the World Bank, or at other Multilateral Organizations, in the Zambian government departments and private sectors, or were independent scholars, consultants and interested parties in some form.
The semi-structured interviews provided a useful vehicle for participant actors to analyze events from the perspective of their interests and objectives (Lewis, 2005).
A degree of triangulation was provided in this study by means of cross-interview analysis. Interviewees were asked to discuss and analyze a common set of events as well as comment on the actions and motivations of other actors. Further corroborations and corrections to subjective interpretation were sought through examination of a range of additional primary sources, particularly contemporary 110 newspaper articles and historical documentation extant on the Internet as well as other commentaries and analyses, both contemporaneous and retrospective (Lewis, 2005).
Research Population and Sample
The interview sample was derived by a Delphi process of peer nomination (Hicks, 1999) with assistance from the office of the
Director of the Technical Committee on ICT policy in the Ministry of
Communications and Transport and the Legal Director of the
Communications Authority of Zambia. The derived list was comprised of individuals who had been closely involved as primary actors in the development of ICT sector policy in Zambia since the 1990s or afterwards. Of the 29 interviewees identified, in-depth interviews were secured with 17, interviews with five others where done via the
Internet through emails and a qualitative questionnaire developed by the researcher. The last seven would not participate due to scheduling conflicts or lack of interest.
As can be expected, the nature of such a sample as this one introduces an element of random bias. In this case, the sample is dominated by mostly articulate men and women who had access to current communication technologies (Lewis, 2005). The study populations were all knowledgeable about ICT initiatives in Africa in 111 general and Zambia in particular. The “silent” majority were not
identified as interviewees in the peer nomination.
Data Analysis
After field research was completed in August 2005, interview recordings and notes were transcribed on the basis of their direct pertinence to the purpose of the study and research objectives. Raw
data was sorted according to place in time and themes. Other data
was sorted on the basis of sources, because they varied from
government to Multilateral Organizations and private sector institutions
and in some instances the same interviewee was seen more than once.
Limitations and Exclusions
The research limited itself to interviews in two locations, namely,
Washington D.C., USA and Lusaka, Zambia. Time constraints as well
as financial resources did not enable the researcher to reach several
people of interest who where beyond reach. As is often the case with
qualitative research, some subjects were reluctant to participate
because the research covered political or organization policy issues.
Several people at the World Bank in Washington D.C. and the Country
Office in Lusaka refused to be interviewed for various reasons.
Research funds were limited. The researcher mostly used
personal resources for travel and communication. He is grateful for the 112 assistance given by the Scripps College of Communication at Ohio
University to purchase recording devices and research materials.
This study is limited to answering the research questions set
forth, and to identifying specific implications of the role of MOs in
Zambia’s ICT policy process. While putting this information into context and interpreting it, this study touches on research in a number of related disciplines; however, it is not within the scope of this study
to:
Comprehensively describe specific development activities that
MOs are undertaking in Zambia.
Compare and analyze various theories of ICT diffusion and
national development including in-depth discussion of digital
divide, knowledge gap and international regime theory.
Address in-depth the current state of debate over the future of
the relationship between Zambia and MOs.
Each of these areas raises separate and important questions, which
could be addressed more fully and fruitfully in other studies.
113
Chapter Five – The Policy Process and Technology Options
Introduction
Zambia’s ICT policy has a preamble: “A Zambia transformed into an information and knowledge-based society and economy supported by consistent development and pervasive access to ICTs by all citizens by 2020” (Ministry of Communication and Transport, 2005).
The preamble is the quintessence of what the creators of the policy hope will be achieved through the implementation of its policy.
It is forward looking and envisions a Zambia with widespread use of
ICTs for societal benefit. The ICT policy is complimented by the
Telecommunications Act of 1994 and the 1994 Investment Act intended to help achieve the vision. Commenting on the vision of the policy, the Director of the ICT policy Technical Committee Victor
Mbumwae stated that the ICT policy was necessary for three things, namely;
“that it will be a platform; a path; and an arbitration
environment. A platform, so that everyone can feel some
ownership of ICTs and experience a level playing field; a path
with elaborate guidelines for public and private implementation;
and an arbitrator to harmonize the interaction between different
competitors or consumer groups through a robust, independent 114 and politics free regulator” (personal communication, August 2,
2004).
The above observation is a succinct summary of what all stakeholders were looking for in an ICT policy. Mr. Hastings Mtine, Chief Executive and Partner for KPMG (Zambia), agreed with the above position, and added that ICT policy was a business instrument
“as it would inform investors of their rights, the rights of the
customers and the expectations from government. This level of
assurance was needed to make projections for capital injections
and profits” (personal communication August 5, 2004).
Given this background, it appears the ICT policy process in
Zambia began with the requirements for transparent and effective legal and regulatory instruments that would lead to realignment of government owned monopolies to make them operate on business principles. Keohane and Nye, Jr. (1998), suggested that governments that want rapid development will have to give up some of the barriers to information flows because closed systems have become more costly. Foreign investors want to invest funds in a country where the key decisions are not made in an opaque fashion. Transparency is becoming a key asset for countries seeking investments. The ability to hoard information undermines the credibility and transparency necessary to attract investment on globally competitive terms. 115 This chapter describes the trajectory of the regulatory and
structural processes/reforms embarked on to achieve the vision and
discusses the technology choices that fit the expectation that ICTs
would be pervasive by 2020.
As indicated in Figure 5.1 (page 117), the ICT policy reforms,
complemented by the Telecommunications Act of 1994 and the
Investment Act of 1994, have produced positive results in both mobile
and fixed telephony. Specifically, the reforms have led to lower entry
costs which culminated in increased competition in the sector, thus
making ICT products and services in general to become cheaper.
Admittedly, some technologies, have found widespread acceptance
and diffusion in Zambia and the rest of the sub-Saharan Africa, while
others have not. For example, throughout the region, mobile phone
use has eclipsed fixed lines, which have existed in these countries for a
very long time. The ITU estimated that, for Zambia in 2005, there
were 4 mobile phone subscribers to 1 fixed line subscriber contributing to a teledensity of 1.3 and 0.8 respectively. For the rest of the sub-
Saharan region, the trend was similar, with nearly 5 million people
connected to a fixed line as compared to 17 million for mobile
telephones, representing a teledensity of 1.5 for fixed lines and 5.2 for
mobile telephones (ITU, 2005). 116 In Zambia, Figure 5.1 (page 117) shows that between 1996 and
2000, fixed line penetration showed modest gains from 77,000 to
84,000, while mobile subscribers increased from none in 1996 to
62,000 in four years. The ITU reported that mobile service surpassed
fixed lines between 2000 and 2004 (see Table 1.3, page 33).
According to the Ministry of Communication and Transport (2005), the
combined subscriber base on the mobile networks stood has increased to 450,000, while that for fixed line subscriber increased to 90,000.
These increases were attributable to the Telecommunications Act of
1994, which ushered competition into the sector and the Investment
Act of 1994, which facilitated the entrance of several private service providers in the mobile telephone sector.
117 Figure 5.1 - Mobile and Fixed Telephony Expansion, 1996 – 2000
90
80
70 Total Number of Telephones (‘000) 60 Telephone Per 50 10,000 population
Total Number of 40 Mobile Cellular Subscribers (‘000) 30 Mobile Cellular Per 10,000 Population 20
10
0 1996 1997 1998 1999 2000
Source: Research and Dissemination Branch, Central Statistical Office (CSO), 2001, Lusaka, Zambia
Rationale for Reform
Olof Hesselmark12 informed the researcher in an interview he thought the country needed an ICT policy to aid the government in confronting the challenges of the digital divide. These challenges were evident due to the haphazard manner with which the problem was addressed without much policy coordination. For example, commercial
12 Olof Hesselmark is a renowned Swedish ICT Consultant and Contractor. He was lead author of the 2002 “A Country ICT Survey for Zambia” sponsored by the Swedish International Development Agency (SIDA). He is author of similar country reports for Tanzania, Mozambique, Rwanda and Namibia. 118 banks in Zambia introduced Internet banking services by themselves
without the guidance of any ICT policy. Zambia did have a policy of
ecommerce, which was not enforced, therefore, the banks conducted
ecommerce operations on their own terms.
Hesselmark pointed out another failure of the government that is
to privatize the monopoly ZAMTEL. Zambia’s ICT policy is intended to
promote competition; however, the continued existence of ZAMTEL
presents obstacles to that objective since the corporation uses its
political connections to insure there is no competition. One example is
its continued monopoly control over the international gateway, which
results in high international calling rates. The corporation is not easily
regulated since the Communications Authority of Zambia was never
given direct responsibility for regulating ZAMTEL (personal
communication, March 15, 2006).
Hesselmark’s comments showed how a lack of clear policy led to
haphazard development. Also he gave a rationale for implementing
reforms aimed at creating sound policy. Zambia’s telecommunications
sector reforms in the 1990s were solution driven, to rectify some of
the problems raised above. The country had suffered declining
economic indicators and was saddled with a $7 billion external debt to
MOs and bilateral donors (Rakner, 2003, Mwanakatwe, 1994).
According to Shirley and Menard (2002), telecommunications sector 119 reform was more likely to take place when there were significant problems in the sector combined with a macro-economic crisis; usually hyper-inflation. In the case of Zambia, the widening digital divide and persistent macro-economic problems led the government to liberalize the economy, and push for improvements in the operations of general government and the state-owned enterprises.
The vigor to institute reforms exhibited by the new government in 1991 showed that the political feasibility of telecommunications privatization and competition was never in doubt in Zambia. Political and economic considerations, coupled with pressure from donors, led the Zambian government to introduce several legislative actions aimed at optimizing utilization of the traditional ICTs. Figure 5.2 (page 120) shows the continuum of regulatory actions since independence in
1964. These policies are reflective of the Zambian government’s domestic agenda and ideology. For example, the socialist leaning UNIP government enacted the Broadcasting Act (BA) of 1966 which paved the way for the nationalization of television and radio industries in order to increase the role of government in economic management of the country as well as to control the message. Following the enactment of the Broadcasting Act, a symbiotic relationship developed between the media and the government. The government strictly controlled the media which in turn was 100 percent dependent on the 120 government for resources.
After a period of economic crises and under pressure to
implement Structural Adjustment Programs, the government enacted
the Zambia National Broadcasting Corporation (ZNBC) Act in 1987 to transform the entity into a corporation. As a corporation, ZNBC no
longer depended on government handouts to survive and was
encouraged to seek revenues outside government grants. According to
Banda (2003), ZNBC became innovative in seeking additional revenue
streams and signed a deal with MultiChoice of South Africa for the
provision of broadcast programs, which was unprecedented for the
government run media company.
Figure 5.2 - Telecommunications and Broadcasting Legislation Timeline. Adapted from Banda (2003). Broadcasting Broadcasting Act ZNBC (Licensing) Regulations Radiocomm- unications Act Information and Media policy
1966 1996 2002
ZNBC Act Telecommuni- Act cations Printed Publications Act Independent Broadcasting Authority (IBA) 121
During the 1990s, the several Acts of Parliament affecting the
ICT sector where focused on removing the management role of government. A common thread was observed through these Acts in
Figure 5.2 (page 120) namely, the introduction of privatization, liberalization, and deregulation.
History of Zambian Telecommunications
Zambia’s telecommunications sector was dominated by the
Zambia Telecommunications Company (ZAMTEL), which was a government-owned-and-operated monopoly. ZAMTEL operated in every district of Zambia. The company was set up and mandated to oversee the implementation of the government policy of countrywide
Universal Service. Universal Service was never achieved; however,
ZAMTEL did have in place substantial terrestrial infrastructure consisting of twisted copper wire lines, microwave and wireless local loops that enabled it to serve as the national backbone for ICT deployment.
Telephone services in Northern Rhodesia were introduced in
1913 in Livingstone, which was the capital city at the time. The system included a manual exchange connected to South Africa (ZAMTEL,
2006). The diffusion of telephones followed pockets of economic 122 activity on the Copperbelt province with scattered installations in other
parts of the country where the British government had control posts.
In 1931, wireless stations were installed followed by a trunk service to
neighboring Southern Rhodesia (now Zimbabwe) in 1932. Other milestones (shown in Appendix C) included introduction of telex services in 1958, a satellite earth station in 1974, digital exchanges in
1985, wireless local loop in 1996, cellular mobile telephony in 1996,
Internet in 1997 and digitization of rural exchanges in 2002 (ZAMTEL,
2006).
Radio broadcasting in Northern Rhodesia was started in 1941 by
Harry Franklin who was then Director of Information in the British colonial administration. The Information Department installed a 300- watt transmitter in Lusaka for the sole purpose of galvanizing support for the war effort during the Second World War among the expatriate immigrants and the indigenous Zambians, and led several Zambians to fight on the British side against the Germans and the Japanese. At independence, the station was renamed the Zambia Broadcasting
Corporation (ZBC). Two years later, the Broadcasting Act of 1966 was passed that transformed the Zambia Broadcasting Corporation (ZBC) into Zambia Broadcasting Services (ZBS) and placed it under direct government control (Banda, 2003). Similar to the colonial government’s practice, radio was deemed an important medium for 123 the new government mobilizing citizens for development. The government aggressively supported its expansion; hence, radio is still the most ubiquitous and popular ICT available to Zambians.
Television transmission came 20 years after radio was first
introduced. It was started in 1961 by the London Rhodesia Company
(LONRHO) in Kitwe, a city at the heart of the copper rich Copperbelt province. It was established to serve the large white community involved in copper mining and commercial activities. After the
Broadcasting Act of 1966, the television station was moved to Lusaka and incorporated into the ZBS. Twenty years later, ZBS was transformed into a body corporate called the Zambia National
Broadcasting Corporation (ZNBC) that would generate its own operational funds and rely less on state funding (Banda, 2003). ZBS and later ZNBC where tightly controlled by the UNIP government until
1991 when liberalization allowed private operators to own radio stations and television stations.
The Regulatory Framework
There were two discernible regulatory frameworks in the ICT
sector in Zambia, which were legacies of traditional forms of ICTs that
included broadcasting and telecommunications. Broadcasting and
telecommunication legislation in Figure 5.2 (page 120) were distinct 124 from one another and were developed separately. The current ICT policy seeks to harmonize these traditional areas into a converged ICT environment. To achieve that, according to Noll (2000), an effective regulatory institution was needed. Such an institution would be:
(a) independent of day-to-day political pressures;
(b) ruled by a clear legislative mandate to assure that service is
provided through a competitive market to as many people as
possible at prices that fairly reflect the cost of service;
(c) operated by a regulatory authority that has the skills and
budget to operate competently;
(d) transparent in its decision making process, as well as in its
rules and policies;
(e) open to participation by all those who are significantly
affected by a regulatory decision;
(f) subject to a mechanism to advocate competition in the
regulatory process, such as a competition agency; and,
(g) subject to formal review by the judiciary and the statutory
authority.
In Zambia, some of the aspects described by Noll have been addressed. According to Director of Legal Services at CAZ, Susan
Mulikita in her interview, 125 “the enactment the Telecommunications Act in May 1994,
immediately positioned Zambia to become a leading African
country in the use of ICTs because it was progressive in that it
established the Communications Authority of Zambia (CAZ) with
a good deal of autonomy from political forces” (personal
communication, August 3, 2004).
The Telecommunications Act of 1994 addressed mostly
telecommunications issues excluding broadcast sector aspects. For
example, the CAZ has greater oversight in telecommunications aspects
than in broadcasting. An attempt was made through the Radio
Communications Act of 1994 to strengthen the linkages between
broadcasting and telecommunications. However, the Independent
Broadcasting Authority (IBA) Act of 2002, created to facilitate the opening of new avenues for radio and TV services across the country, deemphasized the linkages (Ministry of Communications and
Transport, 2005). A dichotomous relationship existed where the IBA, together with the Zambia National Broadcasting Corporation (ZNBC)
Act of 1987 and the ZNBC Licensing Regulations (1993), provided for the legal and regulatory framework for the broadcasting sub-sector in
Zambia while the Telecommunications and Radiocommunications Acts of 1994 focused on telecommunications services (Banda, 2003). 126 Table 5.1 - Regulation of Legacy Systems
Telecommunications Broadcasting Regulatory body CAZ (Autonomous Ministry of regulator) Information and Broadcasting Services (MIBS) Active legislation Telecommunications IBA 2002; Act of 1994; ZNBC Licensing Act of Radiocommunications 1987. Act of 1994. Regulator Licensing; Licensing; responsibilities arbitration, monitoring. monitoring; spectrum management.
Through its oversight of the Telecommunications Act of 1994 and
the Radiocommunications Act of 1994, the CAZ is responsible for
regulating the provision of telecommunications services in the country.
Its specific functions include issuing licenses and promoting
competition amongst providers of telecommunications services and
products, promoting the interests of consumers and other users of ICT services and products as well as ensuring that the benefits of the sector accrue to the nation at large (Communication Authority Of
Zambia, 2005). In addition, the Radiocommunications Act of 1994 gave the CAZ responsibility for managing radio frequencies. 127 Although this function impacts on the performance of radio and
TV broadcasting in the country, the Ministry of Information and
Broadcasting Services (MIBS) has been undertaking the regulatory
functions in licensing of radio and television stations through legal
provisions of the ZNBC Licensing Act of 1987. As part of the
restructuring in the broadcasting sub-sector, the Independent
Broadcasting Authority (IBA) Act of 2002 provides for regulation of broadcasting outside the MIBS, but falls short of demanding that IBA
and CAZ merge to become a one-stop-shop for regulation of the ICT
sector. In the researcher’s interview with Victor Mbumwae, he
observed that there
“exists a gray area in who has specific regulatory authority in
radio and television licensing, between MIBS and CAZ because
MIBS works on administrative procedures while CAZ deals with
spectrum licensing. This situation leads to confusion in the
sector. Therefore, the functions of CAZ and IBA need to be
harmonized to reflect ICT convergence such as the converging
telecommunications and broadcasting markets through Internet
radio broadcasting and online content publishing” (personal
communication, August 4, 2004).
The basis for this concern is the apparent linkages between the
responsibilities of the CAZ and MIBS outlined in Table 5.1 (page 126). 128 In spite of the gray areas, Zambia’s regulatory framework, if analyzed using Noll’s (2000) model, is fairly transparent. For example, all applicants for radio and television licenses follow the same administrative procedures, reproduced below:
Applicants must have a registered office in Zambia and must: 1)
have full legal capacity; 2) be fully suable in a court of law; and
3) provide proof of compliance with the Radiocommunications
Act of 1994.
Applicants must demonstrate fully their financial ability to
construct the station and operate for one year after construction
is completed.
Applicants must fully describe their proposed technical facilities.
Applicants must indicate percentages of program content, taking
care to include economic, social and cultural events in Zambia,
and
If several applicants are equally qualified except for Program
considerations, the Minister will select the best applicant based
on the applicant’s overall program/proposal for local or regional
content (Ministry of Communication and Transport, 2005).
Due to the simplicity in administrative procedures, the applicants’ only real challenge is the cost of capital equipment, which is often imported from abroad. According to Fackson Banda 129 “the significant advances in liberalizing the airwaves started in
1994 have paid off, resulting in the opening of a number of
commercial and community radio stations. There is at least one
community radio station and ZNBC FM Transmission at each
provincial centre, with several community radio stations opening
up annually in other towns. There are three active television
stations, namely, ZNBC, Trinity Broadcasting Network (TBN) and
Muvi TV. In addition to that, MultiChoice Zambia provides Digital
Broadcasting Satellite (DBS) based TV services across the
country” (personal communication, August 6, 2004).
Noll’s (2000) model for regulatory systems is applicable to print media as well. In Zambia, it is relatively easy to start a newspaper as long as the applicant complies with the following administrative procedures contained in the Printed Publications Act of 1994, namely
the applicant is required to register the newspaper with the
Director of the National Archives,
the applicant should supply their full names and places of
residence of every person who is proprietor, editor, printer or
publisher, and
the description of the premises where the newspaper will be
published (Ministry of Legal Affairs, 1994) 130 These simple procedures have led to a proliferation of private
newspapers even though the majority of them go out of business fairly
quickly. Due to lack of sufficient records, it was difficult to empirically
show the actual numbers of registered newspapers that are out of
business. Similar to challenges in radio and television operations, newsprint is expensive to procure, which ultimately makes it harder for private newspapers to become sustainable. The government-owned newspapers are subsidized and are unaffected by high operating costs and low volume sales. Table 5.2 (page 130) comprises Zambia’s most important print media by ownership and frequency of publications.
Table 5.2 - National Newspapers in Zambia
Name Frequency Ownership The Times of Zambia Daily Government Sunday Times Weekly Government The Zambia Daily Mail Daily Government Sunday Mail Weekly Government Financial Mail Weekly Government The National Mirror Weekly Church The Post Daily Private The Mining Mirror Monthly Private The Monitor Fortnightly Private The Today Bi-weekly Private Adapted from Banda (2003)
Organization of the Communications Authority of Zambia
The telecommunications sector in Zambia is regulated in a
manner similar to most countries that have recently liberalized their
industries, as observed in the cases of Nigeria and Mozambique. As 131 shown in Figure 5.3 (page 133), the Ministry of Communication and
Transport (MCT) oversees the policy-making process, while the
industry regulation is delegated to the professional staff at the CAZ.
Prior to the creation of CAZ on July 31, 1994, the Posts and
Telecommunications Corporation (PTC) Ltd. was self-regulating, with advice from the MCT. In the new structure, the CAZ was mandated to promote competition and support innovations by issuing telecommunications licenses and managing the radio spectrum on behalf of the government. To date, the telecommunications sector has been liberalized to a large extent, except for the Public Switched
Telephone Network13 (PSTN) and the international gateway in which
ZAMTEL still maintains a monopoly. The law currently permits only
ZAMTEL as the provider of PSTN services, which include local, national, long distance, and international fixed telephone services, domestic satellite telephone (Domsat), mobile telephone, and leased line services (Ministry Of Communication And Transport, 2005).
The Controller of CAZ is the chief executive officer and is assisted by Assistant Controllers who are heads of the five operational areas that constitute the Authority. The five areas of operation are:
Engineering & Information Technology; Radio Frequency Management;
13 PSTN is the backbone national telephone network, consisting of twisted-copper pair lines, microwave links, coaxial cable, fiber-optic cable, and Domsat links, cooperatively operated by the major telephone carriers, both national and regional (Sterling et al. 2006). 132 Licensing & Consumer Affairs; Legal; and, Finance & Administration.
The management of the Authority is overseen by a Board of Regulators who serve a three-year term and are eligible for re-election. The
Chairman of the Board of Regulators is appointed by the Minister of
Transport and Communication. The Board in turn recommends an individual to be appointed as Controller to the Minister of Transport and Communications (Hesselmark, Esselaar & Silavwe, 2002). The
Telecommunications Act of 1994 provided for nine members to be nominated from diverse backgrounds as follows:
One member each from the Ministries of Defense, Transport and
Communications, and Home Affairs.
One member each from the Zambia National Farmers Union
(ZNFU) and the Consumer Protection Association (CPA).
One member each from the Law Association of Zambia (LAZ)
and the Engineering Institute of Zambia (EIZ).
One member from a trade union representing staff employed by
the company.
One additional member nominated by the Minister of Transport
and Communications (MCT) (Hesselmark, et al., 2002). 133
Figure 5.3 - The Organization of the Telecommunications Sector in Zambia. Policy-making level Ministry of Transport Coordinates introduction and Communications of legislation to Parliament
Regulatory level Communications Licensing, spectrum Authority of Zambia management and monitoring competition
Provision of services Zamtel Private Sector Long distance, mobile, international, Internet
Regulatory Functions of the Communications Authority of Zambia
The CAZ is mandated to promote the wellbeing of the telecommunications sector as indicated in the Table 5.3 (page 134).
Lack of capacity in the CAZ to adequately regulate the industry was a concern to some interviewees. For example in an interview with Palan
Mulonda, Director of the Institute of Human Rights, Intellectual
Property and Development Trust (HURID) in Zambia, he observed,
“the CAZ and government over emphasize infrastructure development to the exclusion of Intellectual Property Rights (IPR)” (personal communication, August 31, 2005). Indeed, as seen in Table 5.3 (page 134
134), the CAZ is more focused on service extension, fair trade and mediation, and so far, is least worried about IPR.
Table 5.3 - Functions of the Communications Authority of Zambia
A Take reasonable steps to extend the provision, throughout all urban and rural areas of Zambia, of such telecommunications services as to satisfy all reasonable demands for them (including emergency services, public call boxes, directory information services and machine services). B Promote the interests of consumers, purchasers and other users of telecommunications services (including in particular those who are disabled or of pensionable age) in respect to the prices charged for, the quality and variety of such services C Promote and maintain competition among persons engaged therein. D Exercise general control and supervision of Radiocommunications and Radiocommunications services. E Promote research into telecommunications and the development and use of new techniques in telecommunications. F Encourage major investors in and users of telecommunications and the development and use of new techniques in telecommunications and Radiocommunication services. G Promote the provision of international transit services (that is, services conveying sound, visual images or signals that have been conveyed to places outside Zambia) by persons providing telecommunications services to Zambia. H Enable persons providing telecommunications services in Zambia to compete effectively in the provision of such services outside Zambia. I Enable persons producing telecommunications apparatus in Zambia to compete both inside and outside Zambia.
Source: Communications Authority of Zambia (2005). 135
Telecommunications License Operating Fees
Any person or business may apply to the CAZ for a License in
Zambia under Section 6 of the Telecommunications Act of 1994. In an interview with the Director of Legal Services at CAZ Susan Mulikita, she said
“administrative procedures to apply for an operating license have
been simplified to facilitate increased access to ICTs. The CAZ
collects non-refundable ZMK15, 000.00 fees from all applicants
and once operational, all licensees are required to pay operating
fees which are a percentage of their net revenues, defined as
gross revenues after Value Added Taxes (VAT) have been
deducted. The percentages are determined on sliding scale basis
and range from zero to 5 percent depending on the type of
service. The high revenue areas such as mobile cellular, paging,
and value added services attract a 5 percent fee, while zero
percent is expected from basic services to rural areas. The zero
percent fees for basic services are used as an incentive to
operators to set up in outlying areas which most private
operators avoid because of slow turn over on their investments.
So far, only ZAMTEL’s Type A4 license qualified for the zero 136
percent for its operations in rural areas” (personal
communication, August 22, 2005).
The various types of licenses issued by CAZ fall under three categories as shown in Table 5.4 (page 137). Type A licenses require the operator to own the fixed line network. So far, only ZAMTEL possesses the license and is the only business with an extensive network in rural areas providing basic services. A Type B license is mainly offered to value added service providers who are not required to build and own a
Public Switched Telephone Network (PSTN). They piggyback on other networks to provide their unique services. Mulikita advised that “ISPs mainly fall under this category for their reliance on leased lines from
ZAMTEL” (personal communication, August 22, 2005). The third license category is for mobile cellular operators. The three mobile telephony operators, namely, Celtel, Cell Z and Telecel, all have mobile services in the rural areas authorized under Type C licenses, which are not considered basic services. A detailed explanation of the license categories and fees are contained in Appendices C and D. 137
Table 5.4 - Three Types of Telecommunications Licenses Issued by
CAZ
TYPE A Licenses Licenses that require Service Providers to install, own and operate public switched telecom network (PSTN) infrastructure facilities.
TYPE B Licenses Licenses that do not require ownership of public networked telecom facilities.
TYPE C Licenses Licenses that require ownership of infrastructure facilities for cellular mobile and paging services.
Adapted from Communication Authority of Zambia, 2005
Spectrum Management
For a land locked country, spectrum management is a serious
issue that often involves foreign governments as well. Domestically,
the CAZ coordinates and allocates use of spectrum on an equitable and
non-discriminatory basis as directed by the Radiocommunications Act
of 1994 Cap 169. The regulated spectrum ranges from 9 KHz to 400
GHz, which represents the entire radio spectrum. The spectrum is
issued for public and private use, such as cellular telephony, television
and satellite stations, security organizations and emergency agencies.
The priority is given to communications for protection of life and
property. CAZ ensures that licensees use their allocations
appropriately in order to avoid interference to others. All radio stations 138 are encouraged to periodically identify their stations using assigned station codes (Communication Authority of Zambia, 2005).
Internationally, Zambia is bound by regulations set by the
International Telecommunications Union (ITU) an agency of the United
Nations. The ITU member countries agree on international spectrum use. The ITU tries to achieve harmonization of frequency allocations intra-regionally and inter-regionally. In some cases, frequency allocations are specific to a particular service such as ambulance or military use; in other cases a group of services can share a band and it is left up to such local organizations as the CAZ to assign frequencies according to local requirements (International Telecommunications
Union, 2006).
Technology and Infrastructure
This section describes some of the technologies used in Zambia as part of the ICT convergence and identifies the main organizations that push for those technologies. ICT convergence has enabled hitherto disparate media and communications to work together in a network. As such, satellites are the principal medium used in the transmission of voice communications from one place to another within the country. 139
Public Switched Telephone Network (PSTN)
ZAMTEL is still 100 percent government owned and exercises
monopoly control over the PSTN and international gateway. The
implication is that ZAMTEL is the only operator that is allowed to offer
local, national, long distance, and international fixed telephone
services, domestic satellite telephone (Domsat), mobile telephone, and
leased line services (ZAMTEL, 2006). Most of ZAMTEL’s infrastructure
is still predominantly analogue and its terrestrial infrastructure is mainly based on microwave14 technology. Zambia’s microwave trunk routes transmit traffic to major provincial exchanges, which is later rerouted into the districts. Because microwave frequencies cannot bend around corners and go over hills, microwave antennas must be in
"line of sight" of each other to interconnect.
Microwave relay towers are strategically placed on elevated ground along the major roads. In an interview with Nang’alelwa
Sitwala, the Chief Telecommunications Engineer at ZESCO, he said
“microwave technology was a natural choice for Zambia because systems can be very efficient in areas that are too remote to economically construct a wired system. For a long time, ZESCO has
used its microwave network for communications along the national
14 Microwave systems are high volume transmission systems that provide long- distance communication without wires. "Microwave systems transmit voice and data through the atmosphere as super-high-frequency radio waves" (Williams, 1999). 140
electric power grid” (personal communication, August 31, 2005). The
following are some of the characteristics of Zambia’s microwave
system: high volume; long distance transmission; point to point transmission; high frequency radio signals are transmitted from one terrestrial transmitter to another; and interconnecting satellites serve as relay stations for transmitting microwave signals over very long distances (Telecom Networks, 2006).
International Gateway
ZAMTEL operates Zambia’s International Gateway for satellite
links to the USA, Europe and Asia using its three earth stations. The
earth station farm is located at Mwembeshi, on the outskirts on the
capital city Lusaka. As a result, the three earth stations derived their
names from the location and are called Mwembeshi I that was installed
in 1974, Mwembeshi II in 1987 and the third is Mwembeshi III that
was completed in 2002. In addition to telephone services, the earth
stations transmit and receive international data and television feeds
via INTELSAT satellites. ZAMTEL has also installed a Wireless Local
Loop15 (WLL) telephone system that caters to areas surrounding the
various exchanges but cannot be reached by wireline technology.
15 Wireless Local Loop is a first and last-mile interconnection using digital radio technology rather than twisted copper pair or coaxial cable to provide the final link from the telephone network to the subscriber (Flournoy, 2004). 141
ZAMTEL’s WLL is also analog, which the company is slowly replacing
with digital technology (ZAMTEL, 2006).
Internet
Mike Jensen (2003) noted that Zambia was the first African
country outside of South Africa to obtain a full Internet Protocol (IP) link in the mid-1990s. The initiative was begun at the University of
Zambia (UNZA), where a project to facilitate academic research networking was successfully implemented. The network was called
UNZANET (see Figure 5.4, page 143) and served the entire academic and research staff of UNZA and reached out to include some non- governmental organizations. The international connections were made via Rhodes University of South Africa through which UNZANET sent its first recorded message to an “African interests” network in Washington
D.C. in September 1993 (Ngwainmbi, 1999).
According to the CAZ Communications Manager Ngabo
Nankonde,
“the Internet has now become an indispensable facility for many
Zambians. The sector is a fully liberalized and competitive ICT
sector in Zambia comprising several major ISPs, namely:
ZAMNET, ZAMTEL, UUNET, CopperNet, and MicroLink which
provide service to nearly 70,000 customers. The majority of the
people access the Internet through telecenters that are present 142
in most Zambian cities” (personal communication, August 22,
2005).
Mulikita added that “CAZ is moving towards free of cost telecenters.
Telecenter operators will have licensing fees waived and will be
required only to register with CAZ to conduct their business” (personal communication, August 22, 2005). 143
Figure 5.4 - UNZANET’s International Connections
JANET EARN-Europe
NGO Networks GreenNet-London African NGOs
Uganda
Kenya
UNZANET
InterNet-Worldwide Tanzania
BITNE Malawi
Zimbabwe
WorkNet
Rhodes UNINET Univ.
Adapted from Ngwainmbi (1999)
Figure 5.4 serves to show the facilitating role played by Rhodes
University in the initial phases of Internet development. Zambia was the first link point while other organizations joined that network later.
This simple diagram also shows the network externalities potential of 144 the Internet that UNZA staff and faculty immediately achieved by affiliating with UNZANET.
Very Small Aperture Terminals (VSAT)
The Telecommunications Act of 1994 completely liberalized the provision of private data networks. This led to most commercial banks, retail chains and other financial institutions involved in tax revenue collection and pension funds setting up their own VSAT data networks to link branches across the country. Mulikita said that
“CAZ has licensed 6 VSAT based Wide Area Networks (WANs) to
different kinds of organizations, such as banks, non-
governmental organizations and private businesses. The VSATs
are located on premises of local businesses to facilitate two-way,
on-demand data communications. Some are linked to bar-code
readers at checkout counters for automatic inventory control as
is the case with Shoprite chain stores which has shops in all
provincial cities” (personal communication, August 22, 2005).
VSAT terminals have a wide array of applications throughout the world. They consist of user-located terminals pointing to affiliated satellites that have been programmed to seamlessly interconnect large and small businesses. VSATs are also used as gateway terminals for consumer-initiated transactions, such as credit authorizations for services at game lodges, shops and automated teller machines (ATMs) 145
(Flournoy, 2004). The cost of business VSAT systems ranges from
$3,000 to $30,000 while those for homes and small businesses can
cost around $1,000.
Mobile Telephony
The diffusion of mobile telephony in Zambia has been rapid and widespread for a variety of reasons. Its architecture is an important
factor. All three cell phone networks, namely, Cell Z, Celtel and
Telecel, use flexible network designs to insure ease of access to
potential users. Bates Mukena, owner of Kegon Services, a local
construction company that erects transmission towers on behalf of the
mobile telephone carriers, explained in an interview that
the innovative designs represent interesting hybridity between
terrestrial and other technologies. The first and most commonly
used design in Zambia comprises cellular phones towers with
transceivers that are linked to the Mobile Telephone Switching
Office (MTSO) in the middle of the city. The MTSO is the
switching office that connects all of the individual towers to the
Central Office (CO) and is responsible for monitoring the relative
signal strength of the cellular phones as reported by each of the
towers, and handing over conversations to the tower which will
provide the best possible reception. This makes it possible for 146
subscribers traveling from one location of the city to another to
enjoy constant connections without any disruptions.
The second design consists of local towers whose traffic is
routed via fiber optic cables that run across the country from city
to city and terminates in the MTSOs. An example is the leased
fiber optic cables from CEC by CELTEL and Telecel. Once ZESCO
completes installing fiber optic cables across the country, most
cell phone traffic is expected to be routed via the ZESCO cables.
The third and most unique design consists of towers whose
traffic is routed via VSATs enroute to the MTSO. This
configuration is used to connect rural areas. For example, the
cell phone traffic in Mansa or Nchelenge, which are far removed
from major cities, is routed via a cell phone tower located near a
VSAT which receives signals from cellular phones and transmits
that to the VSAT (personal communication, August 22, 2005).
The VSAT, as per the illustration below, uplinks traffic (for outgoing signal) from anywhere in the world to a satellite and downlinks (for incoming signal) to a local satellite receiver or dish. 147
Figure 5.5 - VSAT Uplink and Downlink
VSATs used in mobile telephony are capable of speeds up to 56
Kbps. A VSAT, like the cell-phone towers, comprises Outdoor Units
(ODU) and Indoor Units (IDU). The ODU, that contains a transceiver, is placed in direct line of sight to the satellite. These networks use Ku- band frequencies, which permit high-speed broadband connections almost anywhere in the country. These VSATs are interconnected with the MTSO via the satellite in a configuration that allows all local traffic to pass through the local MTSO prior to being relayed to other users
(PANOS, 2004).
Mukena said “the hybridity between satellite technology and terrestrial infrastructure is facilitated by inexpensive, easy to install and interoperable equipment. High skill levels for engineers are not necessary” (personal communication, August 22, 2005). Therefore, 148
from the perspective of operators and of subscribers, it is easy to
identify some common characteristics that entice operators to roll out
this service, and for subscribers to purchase in. Today, the cost of user
devices is significantly less. In an interview with Jetty Lungu, the
Business Development Officer at the United States African
Development Foundation in Lusaka, Zambia, he said “lower end handsets cost around $30 and there is no requirement for binding cellular phone plans. The functionality of cellular phones has improved, allowing users to store contact information, send short message service (SMS), keep track of appointments and set reminders, send or receive email, record videos and photographs and integrate other devices such as PDAs and MP3 players (personal communication,
August 22, 2005).
Fiber Optics
In Nigeria, non-telecommunications companies such as the
Nigerian National Petroleum Corporation (NNPC) helped to accelerate
the telecommunications network expansion by installing cross-country
high capacity digital communication systems. Initially designed for
internal use, the NNPC system comprises hybrid of microwave and
fiber-optics whose excess capacity is leased to other major oil
companies such as Shell, Chevron and AGIP (Ajayi et al., 1999). 149
In Zambia, the current fiber-optics networks owned by ZAMTEL,
Zambia Electricity Supply Corporation (ZESCO) and Copperbelt Energy
Corporation (CEC) provide point-point connections between cities.
According to Nang’alelwa Sitwala, Chief Telecommunications Engineer at ZESCO,
“ZESCO is in the process of installing fiber optics to all major
cities in Zambia as part of Phase 1 roll out. Presently, its
network runs from Mulobezi to Livingstone and from Livingstone
to the Copperbelt catering to internal voice and data traffic. The
second phase construction will include outcrops to the Northern
and Eastern provinces. Once completed, this network will span
about 3,500km of optical grid cabling carried atop electricity
powerline pylons. ZESCO will charge institutional user around
US$2,000 per month for 2 Mbps of bandwidth” (personal
communication, August 31, 2005).
According to the Ministry of Communication and Transport, the
Copperbelt Energy Company (CEC) has installed a 24-core 520km fiber
optic backbone on the Copperbelt, whose excess capacity is leased to
Celtel and Telecel. International fiber optic links terminate at Zambia’s
borders with Zimbabwe at Kariba, Botswana at Kazungula and Namibia
at Katima Mulilo. Fiber-optic networks hold promise for Zambia
because they can be a lot faster and more efficient than networks 150
consisting of copper cables (Ministry of Communication and Transport,
2005). Flournoy (2004) notes that among optical fiber's biggest
advantage is its ability to carry far more information in a given time over far greater distances than any currently available medium. Fewer signal re-generating amplifiers are needed. Submarine transoceanic cables are now being laid without a single amplifier covering a stretch of 3,000 miles (4,828 kilometers).
Satellite
The last discussion in this section focuses on satellite technology.
According to Flournoy (2004), satellites are still the predominant
carriers of international voice, video, and data communications due to
their in-place infrastructure, their global reach, and their information-
carrying capacity. As such, they represent indispensable information
networks for most nations. Network externalities in a developing
country like Zambia are possible because of the country’s access to
satellites. While telegraphy and telephone communications were
introduced in 1913 and 1958 respectively, satellite technology in
Zambia was not introduced until 1974 when Mwembeshi I was
commissioned.
In 1945, science fiction writer Arthur C, Clarke published an
article in the Wireless World titled “Extra-Terrestrial Relays.” He 151
theorized that three satellites in Geo-synchronous Earth Orbit 16 (GEO)
could provide communication coverage to the world (Ngwainmbi,
1999). In the case of Zambia, one satellite in GEO has a footprint large
enough to cover the whole country, therefore, is able to provide point
to multipoint linkages to widely dispersed earth receivers as illustrated
in the Figure 5.6 (page 152). For example, MultiChoice transmits its
Digital Broadcasting Satellites programs via the PAS 7 satellite in Ku
band whose spot beam covers the entire southern Africa and PAS 10
satellite in C band whose wide footprint covers most of the African
continent (MultiChoice, 2006).
16 Geo-synchronous Earth Orbit (GEO) is the location in space at an altitude of 22,237 miles (almost 36,000kms) above the Equator where an orbiting satellite is stationary relative to the Earth (Flournoy, 2004). 152
Figure 5.6 - GEO Satellite Footprint in Zambia
In 1960, the first ever live two-way voice communication via satellite took place and in 1962, AT&T’s Telstar satellite was able to use a traveling wave tube power output amplifier that foreshadowed the satellite communications techniques and equipment to be used in commercial distribution systems such as television transmission. The development of satellite technology received a great boost from the
UN and the US government when on December 20, 1961, The United
Nations General Assembly adopted the Resolution 1721, stating that global satellite communications should be made available on a non- 153
discriminatory basis and on August 31, 1962, President John F.
Kennedy signed the Communications Satellite Act, with the goal of
establishing a satellite system in cooperation with other nations. These two initiatives culminated in the creation of the International
Telecommunications Satellite Consortium (INTELSAT) on August 20,
1964 (INTELSAT, 2005).
Zambia’s connection to the INTELSAT system was through the
Mwembeshi earth station, commissioned in 1974, which is today
interfaced with INTELSAT’s 6th generation satellites. Mwembeshi I, a
30-meter diameter parabolic shaped antenna pointed towards
INTELSAT satellites placed above the Indian Ocean Region (IOR) at 60 degrees east. Mwembeshi II, an 18-meter diameter parabolic shaped antenna pointed towards INTELSAT satellites overlooking the Atlantic
Ocean Region (AOR) at 335.5 degrees east. Both started out as analogue services but were converted to digital in 1997 (ZAMTEL,
2006).
After nearly 38 years as the only intergovernmental organization
providing satellite communications for lesser developed countries,
INTELSAT was transformed from a government-protected monopoly
with ties to national telephone companies and their
telecommunications ministries into a for-profit entity in July 2001. 154
ZAMTEL continues to use INTELSAT for Internet traffic, fax and telex messages, television, voice and data traffic (INTELSAT, 2005).
155
Chapter Six – Multilateral Organizations and Domestic Policy
Introduction
This chapter discusses and analyzes the roles of the Multilateral
Organizations in establishing Zambia ICT policies. Zambia’s ICT policy process is a multilevel phenomenon that has necessitated interactions between domestic, regional and international policy-makers. Based on these interactions, the discussions in the dissertation are therefore framed in political economy discourse and explained using the modernization and dependency paradigms. The Zambian government officials, the MO officials and independent individuals interviewed for this study all acknowledged that MOs were involved in the drafting and played a key role in the final language of Zambia’s ICT policy.
The major finding of this study is that impetus for Zambian telecommunications sector reforms, without a doubt, was based on a domestic need. Beginning in the 1980’s, Zambia’s failing economy required that radical measures be instituted in order to turn things around. The weak economy inherited by the Movement for Multiparty
Democracy (MMD) government in 1991 forced them to adopt policies more aligned with the new economic imperatives. The various policy reforms that took place were, therefore, an attempt to respond to these economic imperatives. The evidence of increased investments, 156 competition and efficiencies in Britain and the United States that resulted from de-regulation of their telecommunications sectors formed part of the basis for these reforms.
Another finding of the study was that the role of MOs was not seen by most interviewees as an imposed regime, but rather as supportive of local initiatives. This finding is not entirely surprising because MOs were part of the international donor community, affectionately called “cooperating partners” in official circles, whose aid and funding were perceived to be acceptable as a form of supplemental revenue for government programs. For these interviewees, the Zambian ICT policy was considered just another example of a government program deserving of donor aid. An interviewee who did not want to be identified said,
“the process was to a large extent funded by international
donors from consultancy through the writing the of the ICT
policy. I know this because I work for one of the largest
international donors in the country. Evidently, without donors
the funding would not be available to implement ICT policies
because the Zambian government’s priorities lay elsewhere”
(personal communication, August 25, 2005). 157
The context for policy-making in the Zambian ICT sector differs
dramatically from that in the developed countries. The developed
countries already had established infrastructure to support ICT
convergence. Their ICT polices had been determined locally. The above
example indicates certain vulnerability on Zambia’s part because the
Multilateral Organizations funded the process beginning from the
consultancy stage and continuing to the final draft. According to
Benjamin Mpolokoso, an Information Technology consultant for
UNICEF in Zambia, three main sets of external agents influenced the
objectives of the Zambian sector, namely
“... (the) multilateral agencies, large donors, and international
suppliers of ICT equipment and services. These external agents
included the United Nations Development Program (UNDP),
Common Market for Eastern and Southern Africa (COMESA) and
Southern Africa Development Community (SADC), World Summit
on Information Society (WSIS), and the private sector such as
mobile telephone operators and ISPs. They were not limited to
donor agencies17” (personal communication, January 22, 2006).
According to Mpolokoso, the multilateral agencies were the WB and
IMF, while the large donors were mostly the Organization for Economic
17 The term ‘donor agencies’ was further expanded to denote non-governmental institutions that give funding to government programs such as the World Bank and the IMF. 158
Co-operation and Development (OECD) countries. Suppliers of ICT equipment included software manufacturers and IT distributors.
Most of those interviewed in this research acknowledged that the multiplicity of stakeholders, although helpful in developing the debate, introduced other levels of complexity for ICT policy-makers who lacked experience negotiating the various positions advanced by stakeholders. The sprawling nature of ICTs led to increased interaction between different actors that hitherto belonged to unrelated sectors and industries. In an interview with the researcher, the Director of the
ICT policy Technical Committee Victor Mbumwae stated that,
“the ICT convergence made it impossible to lock down an ICT
definition in one of its constituent sectors, using that narrow
focus to prescribe a policy for such a wide area. Nevertheless, in
Zambia, the major stakeholders included the Zambian
government Ministries under the leadership of the Ministry of
Communication and Transport and the ICT policy Technical
Committee. Other equally important stakeholders were outside
government. They included international and regional institutions
and domestic actors, such as World Trade Organization (WTO),
WB, IMF, ITU, SADC, COMESA and the New Partnership for
African Development (NEPAD)” (personal communication, August
02, 2005). 159
How MOs Influenced the ICT Policy Process
In this research, it was clear that MOs influenced Zambia
through several mechanisms. The first and most obvious was the
copying and adopting of recommendations. The Zambian government,
being a signatory of several regional and global declarations and
protocols, adopted into its ICT policy several recommendations that
were initiated by MOs. Initiatives of the various groups, such as the
United Nations (UN), WB, WTO, African Union (AU), International
Telecommunications Union (ITU), New Partnership for African
Development (NEPAD), Common Market for Eastern and Southern
Africa (COMESA) and Southern Africa Development Community
(SADC) have had varying degrees of influence on the outcome of the policy process.
The second mechanism was through targets and benchmarks, such as the Millennium Development Goals (MDGs) set by the United
Nations and World Summit for Information Society (WSIS). For example, the UN community initiated the MDGs in 2000 to reduce poverty by fifty percent in developing countries by 2015. Zambia, being party to this agreement, went along with the recommendations to incorporate MDGs in its policies to focus ICTs towards, inter alia, eradicating hunger, reducing child mortality, improving maternal health, and achieving universal primary education (Ministry of 160
Communication and Transport, 2005).
When Zambia participated in the WSIS in 2003 under the auspices of the ITU in Geneva, the summit declarations asked participating countries to integrate the Plan of Action made at the forum into the country’s social and economic agenda before the next summit in 2005. Zambia’s ICT policy included these recommendations within the time frame (WSIS, 2003). In the pan-African commitments, the Zambian policies where influenced by initiatives of the e-Africa commission division of NEPAD which was created in 2001 to facilitate strategies relating to establishment of ICT infrastructure and transfer of skills to the African population (Ministry of Communication and
Transport, 2005).
The third and most difficult to avoid mechanism of influence was the “persuaded obligation”18 that Zambia experienced through its debt of gratitude to MOs. Persuaded obligation would be meaningless if MOs did not posses some form of power over Zambia. Keohane and Nye, Jr.
18 The researcher coined “persuaded obligation” out of a synthesis of persuasion and cognitive dissonance theoretical frameworks. Reardon (1991) advanced that persuasion is a form of communication in which every person who ventures forth into the company of others must participate. It is necessitated by the single fact that all of us differ in our goals and the means by which we achieve them. The inevitable result is that our goals are often at cross-purposes with those of others. Therefore, persuasion involves guiding people toward the adoption of some behavior, belief, or attitude preferred by the persuader through reasoning or emotional appeals. The phrase is also grounded in Leon Fetinger’s (1957) cognitive dissonance theory. According to Festinger, [MOs] seek to reduce dissonance through increasing the attractiveness of the chosen alternative and decreasing the attractiveness of the unchosen alternative. Festinger focused on choice from among alternatives. However, once that choice was made, the choice-maker was obligated to defend it.
161
(1998) advanced that international relationships depended on perceptions of power. They drew a distinction between behavioral
power--the ability to obtain outcomes you want--and the resource
power--the possession of resources that are usually associated with
the ability to reach outcomes you want. Behavioral power, in turn, is
divided into hard and soft power. Hard power, they suggested, is the
ability to get others to do what they otherwise would not do through
threats or rewards. Soft power is the ability to get desired outcomes
because others want the same things as you want. It is the ability to
achieve goals through attraction rather than coercion and works by
convincing others to follow or getting them to agree to norms and
institutions that produce the desired behavior.
According to Rakner (2003), Zambia owed $7 billion in external
debt to donors, mostly to the IMF and World Bank. Situmbeko and
Zulu (2004) argued that the IMF and World Bank used this position of
resource power to persuade the Zambian government to enact the
1992 Privatization Act that led to the sale of 257 parastatal companies over seven years. The World Bank commended Zambia for carrying out the most successful privatization program in sub-Saharan Africa
(World Bank, 1996b).
Multilateral Organizations also use “persuaded obligation” to include or exclude a country from their programs, benefits and 162
networks. For example, by signing the WTO Agreement on Basic
Telecommunications Services (BTS), Zambia achieved a global market
for its services. Even though Zambia had a choice not to sign the BTS
agreement, the failure to sign the protocol would have excluded
Zambia from all those perceived markets within the network of free
market trading countries.
The following section describes the Multilateral Organizations
identified by interviewees and outlines the various ways in which the
Zambian ICT policy process was influenced by those international and
regional organizations.19
The World Trade Organization (WTO)
The WTO was formed at the end of 1994 during the eighth
(Uruguay) round of negotiations to implement a General Agreement on
Tariffs and Trade (GATT). According to Taylor and Jusawalla (1998),
the WTO determined that telecommunications had become a central
concern in international trade negotiations, and as a result
telecommunications services were to be treated as commodities. With
telecommunications services now classified as goods, the WTO
expanded its role to facilitate the back and forth flow of
telecommunications services between countries and suggested to its
19 Regional MOs refer to those constituted within the African region. International MOs refer to global MOs. 163
members that telecommunications policy and regulation in any given
country had implications beyond national boundaries.
Global Protocols
According to Sterling, Bernt, and Weiss (2006), the WTO trade negotiations have been a major force for privatization and competition in global telecommunications. They identified underlying principles of the WTO which assert that: 1) a free market should govern transactions; 2) all countries should be treated in a nondiscriminatory manner; 3) foreign companies should be treated the same as domestic firms; and 4) the rules of doing business are clear and available to all.
Sterling et al. observed that the creators of this framework realized that telecommunications, owing to its significant role in international commerce, merited special attention through the drafting of specific rules, or annexes. The rules called for nondiscriminatory access to public telecommunications, cost-based pricing, the ability to lease private lines and to connect them to the public network, and other provisions that, at least in principle, obligate countries adhering to the
General Agreement on Trade and Services (GATS) to allow a certain level of access to their telecommunications infrastructure.
Earlier, Oliver (1998) suggested that through the mission of the
WTO, countries had created environments that were necessary to
encourage local and foreign investments, such as the formation of 164 independent regulatory institutions, which were mostly modeled after the United States Federal Communications Commission (FCC). Some people do not believe that Zambia has any leverage on the decisions of the WTO. For example, Jonathon Simwaba, Senior Marketing Officer of the Export Board of Zambia, speaking in his private capacity commented that “Zambia has a very weak voice in international meetings because of its poor economic status. The IMF, World Bank and the WTO have continued to take advantage of our weak economic base to dictate terms that are not in our favor … Unilateral liberalization in Zambia was imposed on us and our bargaining power in the WTO is at best insignificant and inconsequential” (quoted by
Situmbeko, and Zulu, April 2004).
Persuaded Obligation
As an example of “persuaded obligation”, both the Zambian
Telecommunications Act of 1994 and Zambian ICT policy advocate for increased competition and liberalization as argued by the GATT/WTO.
Zambia’s ICT policy of 2005 acknowledged that the global economy is now dictated by protocols created by the WTO since the WTO’s
Agreement on Basic Telecommunications Services (BTS) affects the provision of telecommunications services worldwide (Ministry of
Communication and Transport, 2005). Zambia was among the first 69 countries to become a signatory to the Fourth Protocol of the GATT. 165
The protocol specifically dealt with negotiations on market access for basic telecommunications services that are enforced by the WTO
(WTO, 2006). Further, Zambia is obligated to implement the WTO
Ministerial Declaration on Trade in Information Technology Products20 and to cut customs duties on computer and telecommunications products. Speaking on the occasion of the ITA announcement, Renato
Ruggiero, Director General of the WTO, said
“the impact of these agreements on improved living standards
for the world’s citizens should not be underestimated. The…
telecom hardwares… that are included in the ITA are the conduit
for the delivery of information. By making such products more
affordable, we move one step closer to the vision of a telephone
in every village of the world. The ramifications of such an
achievement to the health and education of those in the poorest
countries are obvious (WTO News, 1997).”
Following this declaration, a three-year period from July 1, 1997 to
December 31, 2000 was allowed for signatories to work towards complete elimination of customs duties on ITAs. These tariff reductions applied to all WTO members on a most favored nation
20 Zambia was one of the forty governments that agreed, on 26 March 1997, to implement the WTO Ministerial Declaration on Trade in Information Technology Products (ITA) that obligated signatories to cut customs duties on computer and telecommunications products beginning on July 1, 1997 and eliminate them altogether by the end 2000 (WTO News: March 27, 1997). The declaration is presented in Appendix I.
166
(MFN) basis. To this end, the Zambian government has been slowly implementing obligations to the WTO agenda. For example, as Mwewa
Phiri, who is Managing Director for FirstFone, a Lusaka based Internet café, observed
“since the beginning in 1997, Zambia gradually reduced customs
duties on computers and computer accessories until 2006 when
the new budget announcement completely eliminated the duties.
Taxes on capital equipment for telecommunications have been
reduced as well” (personal communication, January 22, 2006).
Criticism of the WTO
The policies of the WTO have been criticized by various commentators. Van der Stichelle (1997) argued that the WTO contributes to unequal competition, which leads to marginalization of the least developed countries (LDCs). According to Van der Stichelle, a highly complex and nontransparent competition system has been established involving participation in production and information networks, which requires technology, capital, training and management that developing countries lack. Therefore, these countries are not able to compete fairly in global trade. The transnational companies, he advances, are the real beneficiaries of this system. 167
Van der Stichelle’s concerns have local implications as Nason
Bimbe, a Zambian Internet Information Systems Officer at the
University of Sussex in England, opined that transnational companies
such as Microsoft “have been running advertisement campaigns on
hardware and software piracy in the national press which has
influenced the area of the policy covering this topic, especially through
its local franchises or dealers” (personal communication, January 22,
2006). He had no problem with these companies’ vigilance in
protecting their Intellectual Property Rights and the ability of the policy to enforce that right. However, he observed gaps in the policy for its lack of emphasis on the creation of professional societies:
“to bring together information technology (IT) professionals
under one umbrella and monitor professional conduct and
qualifications. This group can also supervise the disposal of IT
equipment which is a big challenge at the moment. I have been
to several IT companies and they have a lot of junk from
overseas. The policy should have tackled this, which I suspect is
dumping.”
Van der Stichelle and Bimbe’s fears are clouded in political economy
arguments because, evidently, the WTO is supervising activities which
are unidirectional. As seen above and in Appendix F, the information
technology products are being passed from developed countries to 168
developing ones. Zambia is duty-bound to support transnational
companies through the most favored nation rules to enforce
Intellectual Property Rights obligations in the market countries. Due to
these types of trade activities Deane and Opoku-Mensah (1997)
accused the WTO of making deals to further reinforce ‘rich-world-poor-
world’ inequalities.
The World Bank
The WB was created in 1944 to assist in the reconstruction of a
devastated Europe after the Second World War and to foster
development efforts through the transfer of resources (Selassie,
1984). The WB has expanded its role in providing development
assistance to developing countries, including Zambia (World Bank,
2004). Only a few countries participated in its creation, but it has now
evolved into a membership organization consisting of countries from
every continent. However, it still operates within the framework
established at Bretton Woods, New Hampshire, USA, where from the
start the United States of America, followed by the United Kingdom and France, and by West Germany and Japan, held the largest shares and subsequent influence on its operations (Selassie, 1984).
According to Marvis Amphah, Senior ICT Policy Specialist in the
Global Information and Communication Technologies (GICT) Policy
Division of the World Bank in Washington D.C., in the past, the World 169
Bank helped to fund large “telecommunications infrastructure in
developing countries and supported private enterprises involved in the
telecommunications sector. It also provided technical assistance to
both private and governmental organizations” (personal
communication, March 25, 2005, Washington D.C.).
Zambia officially became a client of the World bank in 1978
following economic shocks experienced due to the rise of oil and other
industrial import prices, and the collapse of copper export prices. To
overcome these shocks Zambia had to undertake heavy external
borrowing. By 1991, Zambia owed the World Bank nearly $3 billion in
principal and interest loans, thus making the WB is the largest multilateral lender to the Zambian government for a wide array of projects and programs including the telecommunications sector
(Ministry of Finance, 2000). Since 1951, the WB has undertaken 265
telecommunications and information technology projects worldwide totaling $11.8 billion. The funds were provided mostly to monopoly providers to purchase equipment and roll out services (Kenny and
Lewin, 2005).
ICT Convergence
In recent years, the increased ICT convergence convinced the
World Bank of the beneficial economic impact of ICTs on developing economies, hence its pledge to support these efforts with vigor. The 170
WB’s modernization policy supports the correlation between increased access to and use of ICTs and economic development. As a result, the
WB funds projects and programs which at one level increase or improve infrastructure, therefore extending access to voice and data communications. At another level, the WB fosters policy changes by supporting market liberalization, deregulation, competition and customer choice.
In articulating the Bank’s official position regarding the future role of ICTs in WB programs, Jean-Francois Rischard, the Vice
President for Finance and Private Sector Development at the World
Bank, said in 1995,
... (ICT) probably has a bigger role to play in developing
countries than at any time. Poverty can be tackled with the new
technologies available in the fields of health care, population
planning, basic education, food and agriculture, and
infrastructure and basic services. As for growth and
competitiveness, the advanced telecommunications and
informatics technologies will permit leapfrogging, as will the new
distance education methods, production processes and
teleporting (Rischard, 1996).
By specifically tying ICTs to problems areas in health, agriculture, education and infrastructure, Rischard was able to appeal to the 171
consciences of the leadership in developing countries. Rischard further
recommended that the developing country leaders and their citizens
raise their awareness of the imperatives of the new world economy
and of the unprecedented opportunities of new technologies. He
advised that they needed policy, legal and macroeconomic changes to
create an environment that was receptive to new technologies and to
innovation. It is therefore not a coincidence that, following such a
policy emphasis, nearly every developing country has undertaken
some form of economic restructuring in the areas articulated by the
World Bank official. His remarks still constitute a large foundation for
the Bank’s policy on ICT implementation in developing countries.
The World Bank’s arguments are firmly rooted in the
modernization paradigm discussed in Chapter Four. For example,
Grace et al. (2004) observed that for countries experiencing telecommunications technology deficits, the WB urges them to
construct accessible and reliable telephone service which removes
some of the physical constraints on communication, thus can facilitate
increased productivity. This was a plausible argument, which the WB
used throughout the 1990s, to support policy reforms within the
telecommunications sector that emphasized privatization, deregulation
and liberalization in developing nations. In the last few years, the WB
has been even more specific in its approach to ICT policy 172 implementation in developing countries. Guislain et al. (2005) noted that the WB’s Africa Region Development Strategy, adopted in July
2003, identified ICTs as one of the three emerging positive factors for
Africa, offering enormous opportunities to leapfrog stages of development, especially providing rural access (see Figure 1.2, page
22). The other two factors are market reforms and infrastructure construction.
In an interview with Papa Ndiyae, the Executive Director of the
Emerging Markets Partnership (EMP) in Washington D.C., a transnational corporation with shareholding portfolios in several mobile phone companies in Africa and ties to the WB and IMF, he added several examples of the best practices in Africa and elsewhere. He spoke to the benefits of good policies accompanied by examples of areas on the continent where sound policy has translated into huge benefits to local societies. Liberalization, he said,
led to increased Foreign Direct Investment (FDI), which in turn
created quality employment and revenue for the government. In
order for the government to get the maximum benefit from ICTs,
it created enabling policies that allowed for competition in all
areas of ICTs. The Zambian government, for example, reaped
the greatest benefit from a privatized ZAMTEL and increased 173
competition in all its offerings (personal communication, March
22, 2005, Washington, D.C.).
Persuaded Obligation
The World Bank has the wherewithal to influence changes, especially when the IMF and other donors come on line to share a common agenda for a developing country. For example, in order to access the 1991 Economic Reform Credit (ERC) from the World Bank amounting to US$100 million, the Zambian government agreed to sell the Zambia Airways Corporation to foreign investors. In addition, the
Zambian government was forced to carry out massive retrenchments of some 10,000 workers in the public sectors through the implementation of the 1992 and 1993 Privatization and Industrial
Reform Credit (PIRC I & II) (see Appendices F and G). The World Bank and the IMF demanded the privatization of ZAMTEL in order for Zambia to be designated as a Heavily Indebted Poor Countries Initiative (HIPC) and receive aid at concessionary rates under the Enhanced Structural
Adjustment Facility (ESAF I) (Appendix E, p. 215 and Appendix G, p.
225).
Guislain et al. (2005) reported that the World Bank is continuously exploring new ways to strengthen support for local ICT applications, that will help create the requisite skills needed to adapt technologies in Africa and enable Africans to create innovative 174 solutions to their own developmental challenges. One of these strategies as noted by Marvis Ampah was to “promote the privatization of national state assets and telecommunications structures in Zambia and other less developed countries” (Personal communication, March
25, 2005, Washington D.C.). The background of privatization was noted as originating with the WB and IMF policies rather than from developing nations. In essence, this approach was handed down as a prescription, according to a remark by Zambia’s Commerce Minister
Hon. Dipak Patel (Post Newspaper, February 16, 2006).
Privatization of national state assets was a major measuring point in the Structural Adjustment Programs (SAP). The SAP, which dominated the political and economic discourse in Africa in the 1980s and 1990s, was premised on the World Bank’s 1981 Berg report entitled Accelerated Development in Sub-Saharan Africa: An Agenda for Action (World Bank, 1981). The Berg report stated that the causes of Africa’s economic crisis were to be found in the internal policies of the African states. The report pointed to domestic misallocating, political obstacles to growth, and the over-extended public sector
(Rakner, 2003; Gwin and Nelson 1997; van de Walle and Johnson
1996).
175
International Monetary Fund (IMF)
Zambia joined the IMF on September 23, 1965, a year after it gained independence form Britain. Zambia’s faltering balance of payments, evidenced by high import prices and low export earnings forced the country to seek IMF assistance. According to Situmbeko and
Zulu (2004), the balance of payments support should have been a short term intervention by the IMF, however, it continued for over thirty years with annual aid packages averaging $12 to $55 million.
This level of funding to the Zambian government ensured that the IMF possessed leverage over Zambia’s domestic policies. The IMF collaborated with the WB on several projects. It had a somewhat limited mandate focusing on macro-economic stabilization in comparison with the WB. However, through its limited mandate, the
IMF imposed several policy measures such as financial sector restructuring, privatization of the state-owned enterprises, reduction of state monopoly and increase in private investment. These measures evidently formed the core of the telecommunications sector reforms espoused by the Zambian Telecommunications Act of 1994.
Appendices F and G (pages 224 and 226) contain the chronology of programs including conditions set by the IMF and WB as benchmarks that Zambia needed to accomplish before aid was proffered. Bilateral donors in turn used the IMF benchmarks and country status reports as 176 a testimony of Zambia’s credit worthiness and as safeguards of sorts to force the Zambian government to stick to aid conditions. Based on these analyses, Rakner (2003) reported that aid was either given or denied.
By sticking to “program based” financial assistance, the WB and the IMF were able to get several objectives met within the implementation of domestic policies. For example, for Zambia to be eligible for financial aid, the WB demanded governance and human rights issues to become part of the evaluation process. This compelled the Zambia government to consider their actions beyond those the financial assistance was meant to address (Rakner, 2003). Another example of the IMF’s ability to coerce the Zambian government happened when its demand that Zambia’s state electricity company
(ZESCO) and state bank, Zambia National Commercial Bank (ZNCB), be privatized in return for debt relief was met with huge protests in the capital city Lusaka. The Government initially agreed to implement these measures, but the prospect of these privatizations provoked large scale public resistance. Following a major protest march in
Lusaka, the Zambian Parliament voted for a motion urging the government to rescind their decision to privatize ZNCB.
Following this opposition the Government decided to reverse its earlier commitment to sell off these companies. The IMF responded 177
immediately by announcing that Zambia risked forfeiting US$1 billion
in debt relief if it did not go ahead with the privatization. IMF resident
representative Mark Ellyne said, “If they [the government] don’t sell, they will not get the money.” In the end the Government was forced to ignore its own Parliament and go back on its decision not to privatize
ZNCB (Situmbeko and Zulu, 2004).
Regional MOs
The regional Multilateral Organizations (MOs) were highly
effective in directing the policy outcomes of member countries.
However, they appeared less visible than the international MOs in
regard to the ICT policy process perhaps due to their limited
resources. Their importance resided in their proximity to Zambia and
in the high commitment that Zambia exhibited in ensuring that the
MOs succeed. The history of these organizations is directly tied to that
of Zambia and her neighbors and explains their changing roles over
time, to include their promotion of ICTs as a means to end
underdevelopment. The regional MOs, identified by the Director of
Zambia’s ICT policy Technical Committee Victor Mbumwae (2005),
included the Southern Africa Development Committee (SADC),
Common Market for Eastern and Southern Africa (COMESA) and the
New Partnership for Africa’s Development (NEPAD). Each of these had
ICT policy guidelines that member countries were encouraged to adopt 178
for domestic uses. The most significant of these proposed guidelines
are…
COMESA ICT Model Policy, 2003
COMESA ICT Model Bill, 2003
COMESA Guidelines on Licensing, 2003
SADC Declaration on ICT, August 2001
SADC ICT Policy Guidelines, November 2000
SADC Model Policy and Legislation, 1998
SADC Protocol on Communications, 1996
SADC Telecommunications Regulators Association of Southern
Africa (TRASA) guidelines (Ministry of Communication and
Transport, 2005).
The Zambian ICT policy incorporated several recommendations of
COMESA, SADC, and NEPAD, especially in regards to inter-country
interconnection protocols, billing and regulatory frameworks. ICT
policy experts, such as Benjamin Mpolokoso, acknowledged the influence of these organizations,
As far back as 2000, COMESA and SADC recognized the potential
for ICT convergence and cross-country interconnections. They
saw an opportunity to create a uniform platform for Southern
and Eastern African countries, even before the countries
individually had stand-alone policy documents. The guidelines 179
that they formulated have to a greater extent influenced the
direction and tone of the ICT policy in Zambia and other regional
countries (personal communication, January 22, 2006).
The key tenets contained in the SADC and COMESA proposals were:
Increasing market size through integration and cross border
trade with ICTs playing an integral part of the social and
economic development of member states, premised on the role
of network externalities;
Competition among market players in the ICT sector in member
states;
Converging of regulatory authorities in telecommunications and
broadcasting;
Implementing independent and technology neutral legal and
regulatory frameworks;
Independence of market players, especially in regulatory
functions; and
Private sector participation in the development of ICT products
and services (Ministry of Communication and Transport, 2005).
Most of these proposals found their way into Zambia’s ICT policy.
There was definitely duplication amongst international and regional
MOs in the preparation of guidelines for adoption by member countries. The following section gives examples of the most visible 180 regional MOs whose ICT proposals had some influence in the preparation of Zambia’s ICT policy.
Common Market for Eastern and Southern Africa (COMESA)
As previously mentioned, Zambia could trace her history through the trajectories of these Multilateral Organizations. For example,
COMESA is a post-independence African idea whose genesis was rooted in pan-African solidarity and collective self-reliance. It was established to facilitate a larger market, to share the region’s common heritage and destiny and to allow greater social and economic cooperation, with the ultimate objective of creating an economic community amongst African nations (COMESA, 2006). In a nutshell, it was an economic block much like the European Economic Commission
(EEC) once was. As seen in the examples of Mozambique and Nigeria, independent African countries, more than anything else, craved political and economic self-determination, without the interference of past colonial powers. The epistemic rationale for this movement was framed in dependency and modernization paradigms, and involved political-economy power relations. Under these circumstances, in
1965, the United Nations Economic Commission for Africa (ECA) convened a ministerial meeting of the then newly independent states of Eastern and Southern Africa to consider proposals for the establishment of a mechanism for the promotion of sub-regional 181 economic integration. Zambia was involved from the very beginning of the initiative and the very first meeting held in Lusaka, Zambia, recommended the creation of an Economic Community of Eastern and
Central African states (COMESA, 2006). After a series of modifications and name changes, the economic community was finally termed
COMESA in 1994, whose head offices are today in Lusaka. Table 6.1
(page 182) shows the fundamental principles of COMESA. 182
Table 6.1 - Fundamental Principles Enshrined in the COMESA Treaty
a. Equality and interdependence of member States, solidarity
and collective self-reliance
b. Non-aggression between member States
c. Recognition, promotion and protection of fundamental
human rights
d. Commitment to the principles of liberty, fundamental
freedoms and the rule of law
e. Maintenance of peace and stability through the promotion
and strengthening of good neighborliness
f. Commitment to peaceful settlement of disputes among
member States
g. Promotion and sustenance of accountable and just
democratic system of governance
Adapted from COMESA, (2006).
It was explicit in its principles that COMESA extolled good
neighborliness and brought together neighboring countries to visualize
a common destiny. ICTs currently form a big thrust for the objective of forging these relationships. COMESA was active in the advancement of
ICTs by providing resources to member countries. For example, the
preamble for COMESA’s ICT policy document stated that 183
Information is increasingly becoming a critical enabler of
development. Information-based social and economic
development is underpinned by ICTs that support the exchange
of information in a network of users…. This network comprises a
variety of terminal devices, including telephones, receiving
devices and computers, connected to an information
infrastructure, incorporating broadcasting and
telecommunications, of which Internet is an important
component (COMESA, 2006).
As a result, COMESA helped member countries to harmonize telecommunications, broadcasting and information technology into a single integrated network that is supported by sound policy and regulatory systems. It created the COMESA ICT Model Policy of 2003,
COMESA ICT Model bill of 2003 and COMESA Guidelines on Licensing of 2003 as ‘templates’, which Zambia and other member countries have incorporated in their own ICT policies.
COMESA ICT Agenda
The COMESA agenda emulates that of the WB and WTO by aiming to deepen and broaden the integration process among member countries through the adoption of more comprehensive trade liberation measures such as the complete elimination of tariff and non-tariff barriers to trade and elimination of customs duties; through the free 184
movement of capital, labor, goods and the right of establishment; by
promoting standardized technical specifications, standardization and
quality control; through the elimination of controls on the movement
of goods and individuals; by standardizing taxation rates (including
value added tax and excise duties), and conditions regarding industrial
co-operation, particularly on company laws, intellectual property rights
and investment laws (COMESA, 2006). Specific activities included the
formation of a Regional Payment and Settlements system linking
central banks and the launching of the COMESA Free Trade Area (FTA)
enabling the duty-free and quota-free trading on all goods originating within member states. Zambia was one of the initial nine signatories to this agreement.
This language was similar in principle to that of the WTO’s
Ministerial Declaration on Trade in Information Technology Products of
1997, and the WB’s advocacy for neo-liberal economic management.
Further linkages were observed between COMESA and other
stakeholders in the multilevel interactions that influenced Zambia’s ICT
policy. The ‘templates’ that formed part of Zambia’s ICT policy were
part of a comprehensive COMESA e-strategy developed within the 185 framework of the Global e-Policy Resource Network (ePol-NET21) (ECA,
2005).
Southern Africa Development Community (SADC)
Much like COMESA, SADC was a post-independence African initiative aimed at synergizing the different potentials of southern
African countries, through an awareness of political economy relations with apartheid South Africa. The Southern African Development Co- ordination Conference (SADCC), the forerunner of the SADC, was established in Lusaka, Zambia in April 1980 by the governments of nine Southern African countries, namely, Angola, Botswana, Lesotho,
Malawi, Mozambique, Swaziland, Tanzania, Zambia and Zimbabwe, to advance the political struggle against apartheid in South Africa and incorporated ideals for broader co-operation in pursuit of economic and
21 ePol-NET is an initiative of the Canadian and Irish governments in partnership with Italy, France, Japan and Britain, all contributing towards the nodes of expertise to ePol-NET. It originates from the Digital Opportunities Task Force (DOT) Plan of Action, endorsed at the G8 Summit in Genoa in 2001, which made a commitment to establish a Global e-Policy Resource Network (ePol-NET) in support of national e- strategies for development around the world. The Network is also supported by a range of established international organizations such as the Organization for Economic Cooperation and Development (OECD), the United Nations Development Programme (UNDP), the United Nations Conference on Trade and Development (UNCTAD), the Commonwealth Telecommunications Organization (CTO), and the International Telecommunication Union (ITU). The main objectives of the development of an e-strategy at COMESA included the promotion of ICT usage for regional economic integration, enhancement of connectivity and access to ICT services among and within the member States and development of applications and content for the sub-region, while encouraging public-private partnerships. The e-strategy is expected to cover all major aspects of e-applications including e-government, e-commerce, e-education, e-health, e- agriculture etc. It aims to address policy, legislation, regulation, resources and other issues referred to in the COMESA ICT Policy and Model ICT Bill (Canadian e-Policy Resource Centre, 2006 at http://www.epolafrica.org/). 186 social development. Its main objectives were to: reduce member states dependence on apartheid South Africa; implement programs and projects with national and regional impact; mobilize member states' resources in the quest for collective self-reliance; and secure international understanding and support (SADC, 2006).
Zambia spent a great deal of her resources in ensuring the independence of neighboring countries and the dismantling of apartheid. Over time, the political landscape in southern Africa changed and inevitably SADC transformed itself to become an organization that covered several broad economic and social sectors, namely, Energy, Tourism, Environment and Land Management, Water,
Mining, Employment and Labor, Culture, Information and Sport and
Transport and Communications (SADC, 2006).
SADC policy-making roles
The Southern African Transport and Communication Commission
(SATCC) based in Maputo Mozambique, is a subcommittee of SADC whose primary function was to facilitate and coordinate the transformation of the region into an integrated economy by promoting the provision of adequate, interconnected and efficient regional infrastructure. The production of its guidelines was achieved through consultation, co-operation and consensus with stakeholders, namely, consumers, operators, regulators and policy-makers. Through the 187
SADC Protocol on Transport, Communications and Meteorology, which
promoted the establishment of sector-specific associations to enhance
responsive service delivery, and the Telecommunications Regulators’
Association of Southern Africa (TRASA), Zambia was duty bound to
implement aspects of the Telecommunications policy framework and
Model Bill, Fair Competition Policy, Licensing Policy, Universal Access and Universal Service, and the plan for a Regional Frequency Band
(Hesselmark, et al., 2002; SADC, 2006).
The SADC strategy put more emphasis on the integration of ICTs in all economic sectors to achieve the SADC broader political strategies, which were to increase economic growth, reduce poverty and move towards regional economic integration. According to SADC, the use of ICT was an enabler in economic activities that would (a) contribute to economic growth, (b) provide more efficient support to government and businesses especially to small and medium enterprises in the SADC region, (c) increase skills of the workforce, and (d) create job opportunities, especially in new services such as call centers and business process outsourcing (SADC, 2006).
The NEPAD e-Africa Commission
NEPAD was not specifically identified as an organization that was
very influential by interviewees. However, the ICT policy does mention
the benefits of aligning Zambia with NEPAD’s objectives. NEPAD 188 recognized the pivotal role of ICTs in accelerating economic growth and development, particularly in the context of achieving common market and continental integration. ICTs also had the potential to foster intra-regional trade and enhance Africa’s global competitiveness. NEPAD supported two types of projects, namely, those that related to the need to establish an adequate ICT infrastructure on the African continent, and those that related to the establishment of ICT skills in the African population.
The e-Africa Commission was established in 2001, with the mandate to manage the structured development of the ICT sector on the African continent in the context of NEPAD. The Commission developed broad strategies and comprehensive action plans for ICT infrastructure and its use for ICT applications and services. Member countries, including Zambia, have used these action plans, such as those of COMESA and SADC. 189
Chapter Seven - Discussions and Conclusions
Introduction
The purpose of this research was to identify, examine and
contextualize the roles of Multilateral Organizations involved in
Zambia’s ICT policy formulation process and to analyze and evaluate the implications of those policy choices on the ICT sector. This study explored broadly the roles of MOs in the creation of Zambian ICT policies. The research findings identified complex multilayer connections that strongly confirmed that Zambia’s ICT policies were created with a heavy input from regional and international MOs. The
MOs were able to achieve binding decisions from the Zambian government largely due to three circumstances: 1) they created broad
ICT policy guidelines for adoption by member countries; 2) they articulated standards by which implementation of ICT policies were measured, such as the United Nations Millennium Development Goals that called for use of ICT in delivery of health, education and other social services, and 3) used behavioral and resource power to persuade Zambia to adopt these policies.
Some of those who where interviewed, who had been directly
involved or indirectly affected in Zambia, confirmed that the ICT policy
would not have been completed without help from Multilateral 190
Organizations. According to Benjamin Mpolokoso, an Information
Technology consultant for UNICEF in Zambia, “regional MOs also sampled policy ‘templates’ from the World Bank, thus making the
World Bank an original author of important aspects of the ICT policy, especially those dealing with competition, liberalization, privatization
and e-commerce” (personal communication, January 22, 2006). Other
interviewees closer to the policy process viewed the World Bank as the foremost contributor to the process because of its visibility and its contribution of financial resources and expertise to the ICT policy
Technical Committee. It was not possible to accurately gauge the
amount of resources given by the World Bank; however, according to
Victor Mbumwae the Director of the ICT policy Technical Committee,
the World Bank “funded stakeholder seminars and conferences that
the Technical Committee held in order to gather views for the draft
policy” (personal communication, August 02, 2004). Marvis Ampah of
the World Bank agreed that she led several parties to Lusaka to meet
with the Technical Committee and officials of the Communications
Authority of Zambia to aid them in creating a sound ICT policy and
regulatory framework (personal communication, March 25, 2005,
Washington D.C.).
Free market ideologies espoused by the World Bank, World
Trade Organization and the International Monetary Fund, amongst 191
others, coupled with the pressures of Structural Adjustment Programs
also influenced Zambia’s growth-driven policies. On the basis of the
history of the donor aid conditionalities (Appendix E, page 221),
Zambia was compelled to adopt certain measures, such as
privatization of state owned enterprises, in order to be eligible for aid.
The coming of the Movement for Multiparty Democracy
government in 1991 coincided with the winds of change taking place
all over the world, especially in former socialist bloc countries. During
this time neo-liberal economic policy was both politically desirable as
well as a response to popular demands for economic and social
improvements. Zambian’s called this era the “new culture.” The defeat
of Dr. Kenneth Kaunda’s United National Independence Party (UNIP)
government by Dr. Fredrick Chiluba’s MMD during the 1991 elections
was seen by many interviewees as a major factor in the speeding up of
telecommunication liberalization the country experienced in the 1990s.
The UNIP government was less keen on liberalization of the economy
than was the MMD.
The following section discusses the specific research questions.
The data drawn from the literature review and from the interviews were collected and analyzed to help answer the following four research questions. 192
Policy Objectives and Priorities
Research Question No. 1: What were the main objectives and priorities
for Zambia’s ICT policy?
Both government officials and other stakeholders identified
competition and efficiency as the main objectives for the ICT policy
and viewed its implementation as unavoidable in order to enhance
national development. The favored attitudes guiding ICT policy objectives in Zambia, which were widely held, were framed as strategies for national development that took into account the implications of ICT convergence. According to the Director of the ICT policy Technical Committee Victor Mbumwae, the ICT policy challenged the public and private sectors “to identify and establish innovative financing for ICT development, to promote development of local content and applications, to promote Universal Access, to support an effective legal and regulatory framework, to mainstream gender equity and to establish an autonomous body to oversee the implementation of the ICT Policy” (personal communications, August 02, 2005).
Achievement of the above measures, he said, would potentially result in high levels of competition and efficiency.
In order to create such an enabling environment, the government adopted strategies leaning towards greater private sector participation through liberalization, deregulation and privatization. 193
These strategies were implemented, however, only to the extent that
they did not pose a threat to the incumbent monopolies such as the
government-owned Zambia Telecommunications Company (ZAMTEL).
On appearance, the government desired complete liberalization,
deregulation and privatization of the sector, but backpedaled on the
sale of ZAMTEL owing to opposition from within the government and
from labor. To some interviewees, this impediment was not surprising
as this type of reform, at this scale, was new to Zambia. From the
literature review, Spiller and Cardilli (1997) described instances when
the telecommunications provider is established as a natural monopoly,
governments often have difficulties privatizing that sector owing to reasons of national security and potential revenue losses.
It is noteworthy that Zambia appears to have achieved some of
its objectives as offshoots of the implementation of the 1994 Zambia
Telecommunications Act. For instance, as Director of Legal Services at
Communication Authority of Zambia, Susan Mulikita observed, “the
ICT sector reforms brought about competition, especially in the radio
broadcasting, print media, mobile telephony and Internet areas”
(personal communication, August 03, 2004). The competition was
evident as well in television broadcasting where the government
owned Zambia National Broadcasting Corporation (ZNBC), a monopoly
that is now facing competition from the Christian Trinity Broadcasting 194
Network (TBN), locally owned Muvi Studios and the South African- based Multichoice, which provides digital television broadcasting via satellite in Zambia (Banda, 2003). The results of ICT policies, according to the Communications Minister Hon. Abel Chambeshi, are that Zambia now has “one of the highest telecommunications growth rates in the Southern Africa Development Community region, with growth levels of 2% in 2003 and 6% in 2004.” (The Post Newspaper,
November, 15, 2005).
These successes confirm what Bella Mody, Schement and Napoli advocated about the significance of telecommunications in improving the living conditions of people in developing countries. Mody (1995) observed that telecommunications can lead to social and technological changes, that will have positive effects on the openness, connectivity and decentralization of societies. The proliferation of television viewing options is a case in point. Napoli (2001) ascribed an economic benefit to Universal Service by suggesting that interconnections led to network externalities. Schement (1995) suggested that increased use of ICTs afford people opportunities they would not normally have to participate in democratic dispensation.
Linkages between ICT policies and poverty reduction efforts grew out of the strategy to increase competition and improve efficiency. The
ICT policy called for the mainstreaming of ICTs for development. As a 195 widely used blueprint for economic development, the Poverty
Reduction Strategy Paper (Appendix E, p. 212) devised by the World
Bank and International Monetary Fund in consultation with the
Zambian government, reflected poverty reduction and pro-poor initiatives as key components of the ICT policy. These objectives required that amelioration of poverty be carried out from an “ICT for development” perspective such as provision of Universal Access in line with the UN-sanctioned Millennium Development Goals (ECA, April
2005).
Organizations Involved in the Policy Process
Research Question No. 2: What were the leading Multilateral
Organizations (regional and international) and how were they involved in formulating and implementing Zambia’s ICT policy?
The research was undertaken with an initial assumption that the
World Bank was the foremost Multilateral Organization involved in the
ICT policy process. This was proved to be the case from the perspectives of the interviewees on the basis of the tools available to the World Bank to influence policy in Zambia. In addition, the study was able to confirm that other MOs played significant roles in the creation of Zambia’s ICT policy. The MOs were categorized into two categories: namely, regional organizations such as COMESA, SADC and NEPAD, and international organizations such as the International 196
Monetary Fund, World Trade Organization and World Bank. These organizations were able to influence the ICT process mainly through three mechanisms: 1) recommending policy options, 2) setting targets for member countries, and 3) lastly using what the researcher called
“persuaded obligation” to get member countries to meet certain obligations.
The researcher developed Figure 7.1 (page 200) to illustrate the
multilevel nature of interactions between Zambian policy-makers,
domestic partners, regional and international MOs. The figure also
illustrates a major finding of the research that, even though the roles
of the Zambian government and other domestic stakeholders in the
ICT process cannot be over-emphasized, a complex hierarchical
relationship existed between domestic policy-makers and some MOs,
which had the ability to exercise pressure on domestic political and
economic decisions in Zambia.
All interviewees, regardless of their affiliation, were unanimous
that Zambia needed a good ICT policy. As Dean Lubinda-Mulozi,
founder of the Zambia ICT Association (ZICTA) succinctly stated in an
interview with the researcher, “[ICT] policy occupied a central position
in Zambia’s industrial productivity, national competitiveness, Universal
Access, ICT sector coordination, and the ability to monitor and
evaluate and provide interoperability within and outside the country” 197
(personal communications, August 22, 2004). Zambia’s ICT policy was
also outward oriented since the country needed to work within the
standards set by such Multilateral Organizations as the International
Telecommunications Union and Southern Africa Development
Community. ITU’s spectrum guides permit interoperability between
systems from interconnecting countries. The role of SADC’s Southern
African Transport and Communication Commission (SATCC) is to facilitate and coordinate the transformation of the region into an integrated economy by promoting the provision of adequate, interconnected and efficient regional infrastructure.
Figure 7.1 shows that the ICT policy was created to be central to
all sectors of the economy. Its creation involved the government,
represented through the Ministry of Communications and Transport
and the Technical Committee of ICT Policy, who participated as
facilitators. Other domestic players included the civil society such as
PANOS Institute in Lusaka who lobbied for certain provisions to be
included, especially dealing with community radio licensing. Examples
of other players were the private sector operators, such as the mobile
telephony providers, who demanded speedy licensing and arbitration
by Communication Authority of Zambia, and the local and transnational companies, who suggested aspects of the policy, especially those dealing with intellectual property rights. The education 198 sector, largely represented by the University of Zambia, from where the first Internet connection and use was recorded, was also an important contributor.
The ability of Multilateral Organizations to work both within and outside the structures of the government bureaucracy, civil society, private sector and education establishments, enabled them to have a huge influence on the direction of the policy process. Benjamin
Mpolokoso, an Information Technology consultant for UNICEF in
Zambia, confirmed the huge influence. He did an analysis of the extent to which the Zambian ICT policy adopted positions advocated by MOs such as the WB, COMESA and SADC, especially matters dealing with e- commerce (pp. 153, 164). The United Nations Commission for Science and Technology Development in 1997 had identified the generic agents
(Figure 1.4, page 26) it perceived would be involved but failed to show the linear relationships between them. In this dissertation, however, the MOs and domestic actors are arranged in Figure 7.1 to clearly show their position in the policy process. The significant fact of these relationships is the overarching role of regional and international MOs.
These organizations are effective in penetrating any state without regard to borders by using domestic constituencies to compel political leaders to focus on their preferred agendas. A case in point is the interviewee account of regional MOs using World Bank policy 199 guidelines and terminology as their own standards to be adopted by
Zambia. The implication for ICT policy is that such domestic actors as civil society, private sector, and government, are not capable of creating ICT policies without outside support.
Another implication is that the outside stakeholders will continue to yield great influence on Zambia’s domestic polices for as long as the conditions that enabled their influence are not addressed. These conditions include a poor economy that is propped up by donated resources and Zambia’s affinity for guidelines created by outside agents such as the SADC model ICT policy and WTO BTS. In seeking accountability for those resources, MOs are compelled to participate in shaping domestic policies. 200
Figure 7.1 - Key Agents in Zambia’s ICT Policy Formulation Process
Regional MOs: NEPAD, SADC, COMESA
Government through MCT Private Sector Providers Central ICT Policy
Civil Society UNZA/ Education Sector International MOs: WB, IMF, WTO
Formulation and Implementation of the ICT Policy
Research Question No. 3. What was the trajectory of the formulation and implementation of the ICT policy? 201
This question was designed to create a timeline, as can be seen
in Figure 5.2 (page 120), of ICT related policies throughout Zambia’s
history. Apart from the literature, this information was not consistently
available from interviewees. However, interviewees were able to point out that Zambia’s ICT policy process has been non-linear and rife with inconsistencies largely due to major political shifts since independence.
Earlier attempts to regulate the traditional ICTs, such as radio and television broadcasting and telecommunications, were shrouded in the prevailing nationalist ideology. In the early years of independence, following socialist practice, the government increased its role in the management of economic activities through the 1968 and 1969 Matero and Mulungushi economic reforms, and nationalized private media through the Broadcasting Act of 1966. Nationalization was attractive because it immediately increased government revenue and gave greater control over the development process. The practice was rooted in the prevailing dependency paradigm that associated Zambia’s economic growth to self-reliance in all spheres of national management.
Subsequently, the government was compelled by a series of circumstances, such as pressure from Multilateral Organizations through Structural Adjustment Programs and sheer economic survival, to reduce the level of state intervention in economic affairs. The ICT 202 convergence, especially in the 1990s, created conditions where a coherent policy was immediately necessary in order for Zambia to participate in an increasingly networked world.
Dr. Emmanuel Kasongo, late Director of Zambia Mass
Communications Trust (ZAMCOM) in Lusaka, said that “getting through the policy process was a great achievement in itself because in Zambia policy initiatives were known to sizzle quietly and be shelved forever to gather dust” (personal communication, August 22, 2004). This observation is important in the context of ICT policy formulation since
Zambia’s history of nationalization and state intervention in the economy was unfavorable to competition and liberalization and greatly eroded investor confidence. The new policy had to be highly visible, transparent and effective in order to attract private partnerships.
In a interview with Shuller Habeenzu, Chief Executive Officer for the Communications Authority of Zambia, he suggested that any serious analysis of the trajectory of the ICT policy should start with
Zambia’s Telecommunications Act of 1994, which formed the basis for competition in the ICT sector, improvements in consumer choices, and rapid roll out of such ICTs, as Frequency Modulation (FM) radio stations, mobile telephones and the Internet. The Telecommunications
Act of 1994 advocated for increased private sector participation in provision of telecommunication services. It led to the creation of the 203
Communications Authority, which is responsible for licensing and
arbitration. The fact that radio and mobile phone penetration increased
since that Act, he said, is testimony to the significance of the Act
(personal communication, August 02, 2004).
Lastly, actions taken to reform the ICT sector were designed to
provide the Communications Authority of Zambia (CAZ) with structural
autonomy, improve its management flexibility, and enhance its
financial standing. The main goal was to create favorable conditions for
CAZ to improve its sector management capability. According to CAZ
Chief Executive Officer Shuller Habeenzu, the policy “was designed to provide incentives and a platform that benefited the Zambia’s ICT
sector.” The end result was a proliferation of service providers in
mobile telephony and value added services, as well as a climate of
competition that did not exist before. Officials claimed that the policy
was meant to be a catalyst to induce operators to expand services,
including Universal Access options.
Concerns about the ICT Policy and Process
Research Question No. 4: What concerns do you have about the ICT
policy and the formulation process?
Interviewees expressed several concerns that are aggregated into four levels in this study. These levels of concerns are government,
Multilateral Organizations, regulatory and ICT convergence. 204
Government Issues
At the government level, several concerns were discerned. For example, legal scholar and Director of the Institute of Human Rights,
Intellectual Property and Development Trust (HURID) in Zambia, Palan
Mulonda, expressed concern over the government’s lopsided modernist approach in emphasizing infrastructure development to the exclusion of Intellectual Property Rights (IPR). IPRs are essential for protecting local ICT developers as well as foreign ones, he said, and also assure compliance with WTO protocols. He added that non-regulation of IPRs stifles innovation in ICTs because developers are demotivated by non- compensation for their work (personal communication, August 31,
2005).
Most interviewees agreed that the delay in the privatization of
ZAMTEL called for in 1994 with the creation of Zambia’s
Telecommunications Act, was a concern. Olof Hesselmark, author of the 2002 Zambia ICT Survey, grimly remarked “ten years after the enactment of the Telecommunications Act, the situation is not very different” (personal communication, March 15, 2006). One interviewee, who demanded anonymity, stated that “continued public ownership of ZAMTEL, the delayed deregulation and existence of an inefficient (and dependent) regulator presented major obstacles to the rapid roll out of necessary ICTs (personal communication, August 5, 205
2004). The delay in privatizing ZAMTEL and the inability by CAZ to
effectively regulate ZAMTEL translate into regulatory capture by
ZAMTEL, which in turn has the wherewithal to frustrate private sector
activities. Regulatory capture is an economic situation in which
regulators serve the interests of industry rather than the interests of consumers.
Government inertia had ripple effects in the business community
which was still being expressed as a source of frustration during the
Zambia Business Forum virtual conference on the 2006 national budget. Speaking after the Minister of Finance presented the 2006 budget to Parliament, Jetty Lungu, a Business Development Officer at the United States African Development Foundation in Lusaka, Zambia, pointed out,
the private sector is very willing to finance and build the national
fiber optic backbone and connecting undersea cables to the
Indian and Atlantic oceans to connect Zambia to the rest of the
world. However, the ICT policy and vision are lagging behind,
and ZAMTEL lacks motivation to invest in these programs. I
certainly wished to hear something on these matters in the
budget speech.
206
He further added that
the cost of hardware has reduced over the years but government
must have policies to offer incentives for local production of
computers, for example, to compete against global brands that
have entrenched themselves in the Zambian market. The locally
produced computers will compete with the flourishing second
hand PC market. The same policies should encourage network
connections such as Local Area Networks (LAN), by lowering the
cost of connectivity (personal communication, February 12,
2005).
Nason Bimbe, a Zambian Internet Information Systems Officer at the University of Sussex in England, agreed that since the ICT policy had “lagged behind,” the country is falling behind other nations in terms of ICT infrastructure and uses.22 He recommended speeding up implementation to increase connectivity and if necessary begin to
22 It seems obvious that “lagging behind” is relative. Bimbe compares Zambia to other nations, especially developed ones, which have evidenced increased economic output as a result of sound ICT policies. The Zambian Minister of Communications was, however, enthusiastic that the country’s ICT indicators where higher than most countries in the nine-country SADC grouping. In this study, it is acknowledged that Zambia’s ICT indicators, such as 0.8 teledensity (Table 1.3, page 33) is unimpressive, hence the impetus for the development of an effective ICT policy and regulatory environment. Theoretically, the dependency paradigm asserts that countries are not poor because they “lagged behind” the scientific transformations of Eurpoean states. They are poor because they were coercively integrated into the European economic system only as producers of raw materials, and were denied the opportunity to market their resources in a way that competed with dominant states (Ferraro, 1996). 207
subsidize23 ICT infrastructure so that many more people can get
access. He was concerned that doing nothing further disadvantaged
the country and its citizens from obtaining benefits of a networked
world (personal communication, March 1, 2006).
Multilateral Organizations Issues
Despite widespread acceptance of the role of MOs by the labor
unions, skepticism was obvious. For example, Situmbeko and Zulu
(2004) reported that leaders of labor unions expressed a sense of
betrayal over the outcomes of the privatization program. Joyce Nonde,
President of the Federation of Free Trade Unions of Zambia (FFTUZ),
stated that while the labor movement generally welcomed the principle
of privatization, it did so with the understanding that both government
and the new investors would protect workers’ interests. The
movement’s expectations where never completely addressed,
therefore, they declared that they no longer supported privatization as
a panacea to Zambia’s ailing economy. The withdrawal of labor
support culminated in public protests over the impending privatization of the Zambia National Commercial Bank to which the IMF representative in Zambia issued a warning that Zambia would lose
23 During the Kaunda administration between 1964 and 1991, the government subsidized nearly everything. The practice bankrupted the government coffers and was discontinued at the behest of the IMF and WB as part of the Structural Adjustment Programs. The ICT policy does not advocate subsidies of any kind, but supports incentives for the private sector to lead ICT diffusion, such as reduced tariffs on imported hardware and software. 208 nearly US$1 billion IMF support if the protest continued. The protest was discontinued and the government opted to pursue privatization of the company.
Experiences with Structural Adjustment Programs and other donor conditions like the one ordered by the IMF representative, left such politicians as Hon. Patel skeptical about the motives of
Multilateral Organizations, especially the motivations of the World
Bank and International Monetary Fund in Zambia’s reform process. His views echoed those of the labor union leaders who cautioned their members that liberalization and privatization as recommended in the
ICT policy would lead to job losses (Post newspaper, February 16,
2006).
Further concerns involved the perceived disadvantages of implementing the zero tariffs demanded by the WTO Agreement on
Basic Telecommunications Services (BTS). The implementation of these requirements entailed huge incentives for the private sector, which dissenters argued the government was unable to provide because they needed the tax base to fund other priorities. By abiding to the WTO BTS and IPA recommendations, Zambia’s tax base was reduced, which led to reduction of expenditures on essential services including Universal Service. 209
Regulatory Issues
The advent of ICT convergence resulted in a host of challenges for the Zambian government, especially in terms of regulation. A more dramatic result of the convergence was complete interdependence between technologies and multiple social and political relationships.
Hitherto, the telecommunications sector had been easily regulated because the Post and Telecommunications Company (PTC) was often the regulator within the Ministry of Communication and
Transport. In the new dispensation, the PTC was divested into two corporations namely, ZAMTEL and Postal Services Corporation (PSC).
ZAMTEL did not possess a monopoly control over all communication technology because the whole sector had evolved, but controlled enough portions of the nation’s ICT backbone to stifle competition.
Therefore, at the regulatory level, critics of ICT reforms were concerned about the success of the reform measures when ZAMTEL was not privatized and Communications Authority of Zambia (CAZ) remained a politicized bureaucracy.
The CAZ, whose mandate is to promote telecommunications sector well-being, lacks adequate capacity and authority to regulate the industry. For example, the Zambian ICT policy made provisions for
Universal Access but is less clear than the Nigerian case where the policy promised Universal Access through minimum rollout franchise 210
obligations as part of license agreements. The Zambian policy does not
clearly spell out what Universal Access means in measurable terms
and what monitoring steps will be taken to ensure that service
providers charged with that responsibility meet their obligations. The
major difficulty in making Universal Access a reality in Zambia is
caused by high license fees and the prohibitive cost of network
expansion, particularly with private investment. Under the current
Communications Authority of Zambia mandate, private-sector
operators cannot be coerced into financing network expansion in rural areas. Regulatory policy in Zambia ought to ensure that Universal
Access obligations accompany the award of licenses to profitable markets in cities. Unless this happens, the language of the ICT policy will be meaningless.
A further regulatory challenge refers to what Victor Mbumwae
called a gray area between the functions of the CAZ and the Ministry
of Broadcasting Services (MIBS) in regulating radio and television
licensing. MIBS works on administrative procedures while CAZ deals
with spectrum licensing. A one-stop authority is required to harmonize
these functions to reflect ICT convergence such as the converging
telecommunications and broadcasting markets seen through Internet
radio broadcasting and online content publishing. 211
Technology Issues
In addition to the lack of capacity to guarantee Universal Access,
interviewees were concerned about the cost of infrastructure for
capital projects and also for individuals who want to buy hardware.
Despite the declining cost of consumer devices, televisions and
computers have continued to be out of reach for substantial numbers
of people.24 Universal Access in such an environment is not a realistic
goal within the ICT policy since the economic situation in which people
live makes it not achievable. Only for such ICTs as radio and mobile
telephony, does widespread adoption not seem to be a pipe dream. All
72 districts in Zambia have at least one mobile telephony operator
offering services while radio broadcast signals, including from the
government owned Zambia National Broadcasting Corporation, are
ubiquitous. The Internet is absent from most areas.
For ICT purposes, supportive infrastructure such as a reliable
electricity supply is a necessity. The lack of electricity power supplies
in most rural areas is a concern and a major drawback to ICT use. The
ZESCO electric power grid serves all major towns with intermittent
supply to rural areas. Rural electrification is not widespread and
ZESCO does not yet have a rural electrification master plan. Internally, however, ZESCO has made great strides in improving the use of ICT
24 A large number of people in Zambia live below the poverty datum line. The per capita income is estimated at $308 per annum (Table 1.1, page 15). 212 systems to control customer information, billing processes and debt collection.
Technology determinism, an offshoot of the modernization school of thought, promises new opportunities for Zambia once ICTs are efficiently utilized. The emphasis is on the need to build basic infrastructure in the form of reliable telephone systems, satellite and microwave communications, and fiber optic lines. Several interviewees were worried that focus on technology may disadvantage the local population even further. In reference to the perpetual need for ICT upgrades, Chalwe Mchenga, Zambia Director of Prosecutions, said,
“the most common concern was about sustainability and maintenance that is necessitated by hardware upgrades and the dependency that is created by the need for parts and training” (p. 29). His views echo those of dependency theorists, who fear the perpetuation of unequal relations between developing nations like Zambia and more developed countries. The core concern is about Zambia’s capacity to maintain and control the character of ICTs that are beneficial to the society.
Implications of Policies on ICT Sectors
Zambia’s ICT policy envisages a country with pervasive ICT usage by the year 2020. The achievement of the vision requires that the government set measurable goals for the ICT sector. These goals must include addressing poverty, health care, food security, 213
environmental security, technological advancement, and human-
resource development. ICTs are not, however, a panacea for all social
and economic development and may even lead to unemployment and
social and economic dislocation. There was no evidence of job losses
associated with ICT convergence in Zambia. Elsewhere, employment
was lost when technology replaced people to perform functions. To the
contrary, Zambians believe that ICT will make work functions more
efficient especially in the service industries such as banking, retail and tourism.
On the basis of the evidence and interviews conducted for this
study, it is apparent that the risks of failing to take advantage of ICT convergence are enormous. The major result of non-action will be to
exacerbate the digital divide that exists between Zambia and other
nations. The conventional wisdom is that the information revolution
has a leveling effect as it reduces costs, economies of scale, and
barriers to entry to markets. This conventional wisdom is not entirely
applicable to certain sections of Zambia’s ICT sector. For instance,
enormous barriers to entry enable large established entertainment
industries to enjoy considerable economies of scale in content
production and distribution. Therefore, owing to the dominant
American market share in films and television programs in world
markets, the Zambian media businesses rely on imported content as 214
their main repertoire because the few local products lack the
sophistication enough to compete with imported programming.
Keohane and Nye, Jr. (1998) observed that ICT convergence
enables anyone with a computer to become a desktop publisher and
anyone with a modem to communicate with distant parts of the globe
at trivial cost. The upside to this is the potential of societies to
generate information and distribute it via the internet. For example, all the newspapers in Table 5.2 on page 130 have online versions. The concern remains, however, that even though it is now cheaper to disseminate information, the collection and production of new information often requires costly investments in equipment and human
skills. Zambia does not yet possess the facilities to assemble personal
computers in large quantities. The country relies on imports, which
until January 2006 attracted high duties and import tariffs. Until some
of these costs are eliminated or better managed, the ICT policy cannot
be implemented fully.
The ability to more easily produce and disseminate information
has led to the explosion of cyber information. The quantity of
information available in cyberspace means little by itself. The quality of
information and distinctions between types of information are probably more important. Information does not just exist; it is created. When 215
one considers the incentives to create information, two distinct types
of information that are sources of power become apparent.
One great impact of ICT policy will be actualized if the
predominant use of English in the information products of electronic-
communication technologies, a significant barrier to the use of ICT
products and services in Zambia, is eliminated. For an eleven million
population, Zambia has 72 languages and dialects, and very few ICT
products contain material in these languages (Zambia Central
Statistical Office, 2002). According to Keohane and Nye, Jr. (1998),
the use of English language on the Internet disadvantages speakers of
non-English laguages.
Economic Implications
ICT policies have economic implications. In order for its policy to
work, Zambia’s economy must improve. The country’s per capita
income of $308 (Table 1.1, p. 15) limits demand for ICT products and
services. The major sources of economic output in Zambia are
agriculture and mineral-production. Agriculture and mining are not as
information intensive as the services sectors, which require different
skills, such as retail, banking, tourism, and professional services. The
Zambian government should, therefore, take action to stimulate ICT through these service sectors. The implication will be to generate skills, knowledge, financial resources, and organizational capabilities in 216 information creation, gathering, storage and dissemination. Some of these goals may be difficult to achieve if the country continues to operate under fiscal restraint.
Technological Implications
Chapter Five identified the technologies Zambia should consider adopting to achieve Universal Access. Choosing the most appropriate technological solution is a significant step and decisions should be flexible enough to take into account local environments. Policy implementation should facilitate improved telecommunications infrastructure. Since low-loss optical fibers have revolutionized the field of telecommunications, because of their carrying capacity and high quality signals, these should be considered as a basis for the country’s communication backbone. Satellites can be used for wide area coverage. Twisted pair copper cables will remain important in
Zambia because they reach to all parts of Zambia as a basis for the country’s dial-up telephone system. In urban areas, copper wire can be digitized to bring high speed Internet via digital subscriber lines
(DSL). In urban areas, Zambia can also look to broadband access applications through fiber optic and wireless applications.
Rural areas, lacking basic infrastructure, require different technology configurations to assure connectivity. In the case of rural areas, it is important to select transmission networks and customer- 217
premises equipment that is rugged, has low maintenance costs, and
will survive the vagaries of the ZESCO power supply. In the future,
these ground segment assets will be interconnected via satellites that
already provide cellular backhaul services throughout the country.
Satellite usage is being driven by the rapid roll-out of mobile operators
of coverage to urban and rural areas beyond the reach of terrestrial
networks. In Zambia, mobile operators are now building transmission
networks spanning large distances over challenging terrain in order to
reach major towns or cities. These companies are also bringing
associated infrastructure such as electrical power and roads to service
base stations.
In an interview with Bates Mukena, whose company has
constructed the majority of cellular towers for mobile telephone
operators in Zambia, he thinks that satellite-based backhaul remains
the most practical and economically feasible means of connecting cell sites to the Mobile Telephone Switching Office (MTSO) for both voice and data traffic.
Recommendations for Future Study
This study focused on the role of MOs in the preparation of
Zambia’s ICT policy. The comprehensiveness of the study took the
researcher into policy matters that went beyond the efforts that the
Zambian government and domestic partners made in creating a sound 218
ICT policy. Further investigations could focus on issues not touched on in study such as:
o An analysis of how and where the market might provide
Universal Access for all Zambians.
o A more theoretical analysis of ICT and national development
including discussion of digital divide, knowledge gap and
international regime theory.
o Address in-depth the current state of debate over the future of
the relationship between Zambia and MOs. 219
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Appendix A - Acronyms
ACC Anti Corruption Commission AERC Africa Economic Research Consortium AT&T American Telephone and Telegraph AU African Union BBC British Broadcasting Corporation BoP Balance of Payments CAZ Communications Authority of Zambia CEC Copperbelt Energy Corporation COMESA Common Market for Eastern and Southern Africa CPA Consumer Protection Association CRC Constitution Review Commission of Zambia DC District of Columbia DEL Direct Exchange Lines DOMSAT Domestic Satellite ECA Economic Commission for Africa ECOWAS Economic Community of West African States EIZ Engineering Institute of Zambia FBZ Finance Bank Zambia Limited FINDECO Finance and Industrial Corporation FNDP First National Development Plan GATS General Agreement of Trade and Services GATT General Agreement of Trade and Tariffs GDP Gross Development Product GNP Gross National product GSM Global System for Mobiles HLEG High Level Group International Bank fro reconstruction and IBRD Development ICT Information and Communication Technology Information and Communication Technology for ICT4D Development International Institute for Communication and IICD Development IMF International Monetary Fund Instituto Naçional das Comunicaçoes de INCM Moçambique INDECO Industrial Development Corporation INDP Interim National Development Plan ISI Import Substitution Industrialization ISP Internet Service Provider ITA 237
ITU International Telecommunications Union LAZ Law Association of Zambia MCI Microwave Communications Incorporated MCT Ministry of Communications and Transport MINDECO Mining Development Corporation MMD Movement for Multiparty Democracy MO Multilateral Organization MTSO Mobile Telephone Switching Office NBC Nigerian Broadcasting Commission NCC Nigerian Communications Commission NEPAD New Partnership for African Development NET Nigerian External Telecommunications Limited NGO Non-Governmental Organization NITEL Nigerian Telecommunications Limited NNPC Nigerian National Petroleum Corporation NTP Nigeria’s Telecommunications Policy OECD Economic Co-operation and Development PC Personal Computer PSC Postal Services Corporation PTC Post and Telecommunications Company RBOC Regional Bell Operating Companies SADC Southern Africa Development Community SAP Structural Adjustment Program SIDA Swedish International development Agency SMS Short Message Service SNDP Second National Development Plan SSA Sub-Saharan Africa Tokyo International Conference on African TICAD Development TDM Telecomunicações de Moçambique UN United Nations United Nations Commission for Science and UNCSTD Technology Development UNIP United National Independence Party United States Agency for International USAID Development VSAT Very Small Aperture Terminal WB World Bank WSIS World Summit WTO World Trade Organization ZAMTEL Zambia Telecommunications Company ZANACO Zambia National Commercial Bank ZESCO Zambia Electricity Supply Corporation ZICTA Zambia Information and Communication 238
Technology Association ZIMCO Zambia Industrial and Mining Corporation ZNFU Zambia National Farmers Union ZPA Zambia Privatization Agency
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Appendix B - Important Milestones in the Development of Telecommunications in Zambia
1913 First manual telephone exchange installed in Livingstone.
1931 First wireless stations installed at Mpika and Kabwe.
1931 Second telephone exchange installed in Ndola.
1932 First trunk services between Northern Rhodesia ( Zambia ) and South Africa.
1957 Subscriber Trunk Dialing introduced in the main centers.
1958 Telex Services introduced.
1964 Manual exchanges replaced by Strogger step-by-step automatic system.
1967 Lusaka – Kabwe 960 Channel microwave link commissioned.
1974 First Satellite Earth Station, Mwembeshi I commissioned.
1974 Lusaka – Livingstone 960 Channel microwave link commissioned.
1978 Lusaka – Nakonde Panafftel microwave link commissioned.
1980 Lusaka – Chipata microwave link commissioned.
1985 Introduction of Rural Subscribers System ( RSS ).
1985 First digital exchange introduced serving as International Gate- way 1986 First digital local exchange installed in Ndola 1988 Second Satellite Earth Station Mwembeshi II commissioned 1989 Second fully digital international exchange commissioned 1987 Digital Eltex V Telex Exchange commissioned in Kitwe, ( French made System) 1993 Second digital international exchange with transit facility commissioned 1995 Installation of Telephone Earth Station in Kaputa and Sesheke 1996 Wireless Local Loop introduced Mkushi, Chisamba, Lusaka, 240
Choma and Mazabuka 1996 Cellular Mobile Telephone Services was commissioned 1996 Introduction of DOMSAT Domestic Satellite Network 1997 Commissioning of the Zamtel Internet Service and On – Line Billing 1998 Digitalization of Mwembeshi II was commissioned 2002 Digitalisation of Exchanges and Transmission System in Eastern Zambia
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Appendix C: Three Types of Telecommunications Licenses Issued by CAZ
TYPE A Licenses Licenses that require Service Providers to install own and operate public switched telecom network (PSTN) infrastructure facilities. These are categorized as follows: Type A1 - Network Facilities of basic 2% of the gross local services revenue less VAT Type A2 - Network Facilities for basic 3% of the Gross national long distance Revenue less services VAT Type A3 - Network Facilities for basic 3% of the gross international service. revenue International less VAT Type A4 - Network facilities for basic 0% rural and urban services to sub-economic areas
TYPE B Licenses Licenses that do not require ownership of public networked telecom facilities. These are categorized as follows: Type B1- Basic Voice Services 5% of the gross Revenue voice less VAT Type B2 - Data Transport Services 5% of the Gross Revenue less VAT Type B3 - All other services (e.g. 5% of the Gross Internet service providers; services e.g. Shopping services etc.) Revenue less VAT Type B4 - Network facilities for private Per year use TYPE C Licenses Licenses that require ownership of infrastructure facilities for cellular mobile and paging services. These are categorized as follows 242
TYPE C1 - Local mobile cellular 5% of the Gross services Revenue less VAT TYPE C2 - National mobile cellular 5% of the gross services National Revenue less VAT TYPE C3 - Low Earth Orbiting (LEO) 5% of the Gross Satellite based national Satellite mobile cellular service Revenue less VAT TYPE C4 Paging services 5% of the Gross Revenue less VAT
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Appendix D – Radio Frequency License Fees
TYPE OF STATION LICENCE FEES Citizen Band K29,880.00 Disk License K25,020.00 Cordless Telephone up to 200 MTS K37,440.00 Amateur K62,460.00 Aircraft K125,460.00 Maritime Coast Station K75,060.00 Maritime Ship Station K50,040.00 Aeronautical Commercial K250,020.00 Cross Border K100,080.00 Paging Receiver K30,060.00 Aeronautical Non-Commercial K75,060.00 Repairer's non-Commercial K250,020.00 Dealer's K250,020.00 Base or Mobile Station on Frequencies K62,460.00 above 30 MHz FIXED HF Exclusive frequency K 124,920.00 Shared frequency K 86,940.00 Radio Telephone Line Stretcher K 100,080.00 per End VHF Extra Frequency K 24,840.00 BROADCASTING TV K 5,000,040.00 FM K2,500,020.00 MW K2,500,020.00 SW K2,500,020.00 Application Processing Fee K 37,080.00 HF Extra Frequency Fee K 37,080.00 HF Extra Frequency Shared K 30,060.00 Paging Commercial Shared K500,040.00 Paging Base Transmitter (Non- K 62,460.00 Commercial) 244
US$1,500,000.00 per Satellite News Gathering (SNG) year Duplicate License K 19,980.00 Novice Amateur License K25,020.00 Radio Model License K25,020.00 License to Possess K 19,980.00 Satellite News Gathering Sky K715,500.00 Radio Telephone Operators restricted K25,020.00 Radio Telephone K25,020.00 Standard Frequency K25,020.00 Radio Location K50,040.00 Common Carriers Microwave Stations Per K250,020.00 Transmitter Paging Alarm Transmitter K 37,440.00 Paging Base Transmitter (Commercial) K 124,920.00 Satellite Earth Station K2,385,000.00 SAT Phones K1,120,500.00 Community Repeater K500,040.00
Adapted from Communication Authority of Zambia, 2005 245
Appendix E - Policy Based Loans from Multilateral Organizations
Institution Loan Requirements World Bank 1991: Phase out maize subsidies, liberalizing Economic maize markets, limit bank credits, Reform Credit remove tariff bans, eliminate surplus (ERC) civil service staff, announce privatization policy, offer a minimum of 6 parastatals companies for sale, complete studies of Zambia Airways. World Bank 1992: Fiscal and monetary performance, Privatization harmonize sales taxes, broaden tax and Industrial base, reduce tariffs, retrench 10,000 Reform Credit civil service workers, enact privatization (PIRC I) law, offer additional 10 parastatal companies for sale, restructure ZIMCO World Bank 1993: Fiscal and monetary performance, (PIRC II) reduce tariffs, develop plans for land markets, reform Investment Act, offer for sale 60 companies, establish Privatization Trust Fund, study options to privatize ZCCM. World Bank 1994: Redirect budget to social sectors (health Economic and and education), eliminate export ban on Social maize, create legal basis for land Adjustment leasehold, and begin sale of state owned Credit farms, adoption of acceptable financial (ESAC I) plan for Zambia Airways World Bank 1995: Consolidate improvements in macro- Economic economic management, stimulate Recovery and investment, reorient role of state in Investment investment financing, reform social Project security system, restructure and (ERIP I) privatize ZCCM World Bank 1996-7: Maintain social sector budget of at least ESAC II 35%, privatize ZCCM, implement 1995 Land Act, implement National Housing Policy of 1995, amend Employment and Industrial and Labor Relations Act, and formulate policy on collaboration with NGOs in welfare service delivery. World Bank 1998-2001: Facilitate privatization of ZCCM; improve Public Sector performance of public service; promote Reform and private investment; strengthen delivery Export of social services. Promotion 246
Credit (PSREC) World Bank/IMF 2000: Debt relief to be spent according to a Heavily poverty reduction strategy paper Indebted Poor (PRSP), owned by government and civil Countries society. Quantitative benchmarks: Initiative macroeconomic stabilization, fiscal (HIPC) balance, privatization of remaining parastatals, including ZESCO, ZAMTEL and ZANACO. IMF 1992-95: Restore macroeconomic stability, Rights eliminate arrears to international Accumulation creditors, and implement Economic Program recovery Program in collaboration with (RAP) multinational finance institutions. Completed December 1995. IMF 1995-97: Development of a national Poverty Enhanced Reduction Action Plan; gazetting of Structural banking regulations, re-invigorate public Adjustment sector reform; privatization of ZCCM, Facility ZAMTEL, ZESCO. Not completed. (ESAF I) IMF 1999-2001: Macro-economic and structural reform; Enhanced privatization of ZCCM, ZAMTEL and Structural ZESCO; implementation of public service Adjustment reform; implementation of National Facility Poverty Reduction Plan. Not completed. (ESAF II) IMF 2001-2005: Support of poverty reduction strategy Poverty paper (PRSP), owned by government Reduction and and civil society. Quantitative Growth Facility benchmarks: macroeconomic (PRGF) stabilization, fiscal balance, privatization of remaining parastatals.
Adopted from Lise Rakner, 2003.
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Appendix F - Chronology of IMF Programs 1973-2003
Date IMF program 1973 One-year standby agreement with IMF. 1976 One-year standby agreement with IMF. 1978 Two-year standby agreement with IMF. 1981 Three-year Extended Fund Facility with IMF. 1982 IMF plan cancelled as objectives not met. April 1983 Return to the IMF after failure to find alternative sources of funds; one-year standby agreement. May 1984 Consultative Group meeting on external aid. July 1984 Paris Club agreement on debt rescheduling. July 1984 21-month standby agreement. Dec 1984 London Club commercial bank rescheduling. April 1985 IMF agreement suspended for noncompliance. June 1985 Consultative Group meeting on external aid. Dec 1985 Consultative Group meeting on external aid. Feb 1986 “Shadow program” transformed into 24-month standby agreement with IMF. Mar 1986 Paris Club agreement on debt rescheduling. Dec 1986 Consultative Group meeting on external aid. Jan 1987 Kaunda backs away from reform measures; IMF and World Bank programs are suspended. Mar 1987 Discussions with IMF to get program back on track. May 1987 Kaunda announces suspension of IMF reform effort and introduces New Economic Recovery Program. Zambia declared ineligible to access IMF financial resources because of overdue financial obligations to the IMF. Zambia was one of only eleven countries, six from sub- Saharan Africa, who were in arrears to the IMF at the end of the 1980s. 1988 Informal talks with the IMF and World Bank. Aug 1989 Policy Framework Paper 1989–93 announced. Feb 1990 Zambia reaches preliminary agreement with IMF and World Bank. Sep 1991 The IMF and World Bank suspend agreement in response to Zambia’s failure to make payments in July. 1992 The IMF agreed a Rights Accumulation Program (RAP) with Zambia. This is a Program where an overdue country can gain access to IMF financial resources again through enacting an IMF economic Program. 248
1995 Zambia was viewed to have successfully completed the RAP in December 1995. Subsequently, the IMF agreed two Programs in Zambia; a three year ESAF and a one year SAF. US$1,043 million was provided under the ESAF, and US$270 million under the SAF. The ESAF Program was due to run from 1995/96 to 1997/98. 1999 The IMF agreed a new three year Program with Zambia under the ESAF, providing US$349 million between 1999 and 2001. The World Bank agreed a Structural Adjustment Credit. July 2000 The IMF and World Bank accept Zambia’s Interim Poverty Reduction Strategy Paper (IPRSP) as it provides, “a sound basis for the development of a fully participatory PRSP and for Bank and Fund concessional assistance”. Following agreement on the IPRSP, the IMF completed its first review of the ESAF, which had now become known as the Poverty Reduction and Growth Facility (PRGF). This was seen to be a “significant step” towards the disbursement of US$13.2 million. Total disbursements under the Program would be taken to US$26.4 million. Following the IPRSP the IMF and World Bank produced their preliminary assessment of Zambia’s qualification for the HIPC initiative on 20 July. Dec 2000 Decision point reached in the HIPC initiative. March Second review of the PRGF Program completed and 2001 approved by the IMF in March. Nov 2001 Third annual review of the PRGF completed; by this stage Zambia had drawn US$70 million under the Program agreed in 1999. May 2002 The PRSP is finished and approved by the IMF and World Bank. Zambia also assumed Article VIII status within the IMF. This is an undertaking “to refrain from imposing restrictions on the making of payments and transfers for current international transactions, or from engaging in discriminatory currency arrangements or multiple currency practices without IMF approval.” At this time Zambia’s quota in the IMF was US$622 million, and its outstanding use of IMF financing was US$995 million. The fourth review under the PRGF was also completed. Zambia had taken US$134.8 million under this Program. Nov 2002 Fifth review of the PRGF completed; Zambia had now drawn US$205 million. Dec 2002 The HIPC Program goes off track after the government announces it will not privatize ZNCB. 249
May 2003 The government announces it will privatize ZNCB, and the ZPA starts to receive bids. HIPC back on track. July 2003 There is no new agreement under the PRGF due to projected overspending on the government budget. HIPC off track again.
Appendix G - Chronology of World Bank Programs
Year World Bank program 1970s Lending was generally spread over operations in infrastructure, energy, agriculture, education and financial intermediation. Pre-1972 The rate of lending from the World Bank averaged US$12 million a year. 1973 Program loan to help Zambia cope with the 1973 oil price shock. Between 1973 and 1982 the rate of lending increased to US$55 million a year. 1976 Program loan to help Zambia cope with the collapse in copper prices. 1978 The first IDA credit to Zambia, making Zambia a client of both the Bank and the IDA. 1983 Zambia suspended payments on its external debt. Because of the arrears that resulted from this, the Bank stopped making disbursements in October 1983. With the election of Kaunda at the end of 1983, Zambia reopened negotiations with the IMF and Bank. 1984 Export rehabilitation (copper) and diversification project. 1985 In October the government agreed a reform Program with the Bank and IMF, leading to the World Bank making its first structural adjustment loan to Zambia. Began an agricultural rehabilitation project, and gave credit for industrial reorientation 1987 Zambia abandoned its Program with the IMF and World Bank. 1989 A new agreement on an economic reform Program was agreed with the Bank and Fund in September. 1991 Normal relations between Zambia and the World Bank resumed, due to the ‘policy dialogue’ between the IMF, Bank and Zambia that started in 1989. 1992 In January arrears with the Bank had been cleared. This allowed a new agreement on a policy framework between the IMF, Bank and Zambia for 1992 – 1994. PIRC with conditions attached on privatization and industrial reform. 250
1993 Second PIRC with conditions attached on privatization and industrial reform. 1994 An ESAC agreed with the World Bank. Petroleum sector rehabilitation project. Health sector support project. 1995 Economic Recovery and Investment Project (ERIP) agreed with the World Bank. Agricultural sector investment Program. Urban restructuring and water supply project. Second social recovery project. 1996 Second ESAC agreed with the World Bank. 1997 Public sector reform and export promotion credit – this credit sought to help the reform Program through measures including, “facilitating privatization in the mining sector by assisting with the financial costs of the redundancy program.” Enterprise development project. Environmental support Program. Roads sector investment Program. Multi-sector adjustment credit II. Power rehabilitation project. 1998 Health sector project. 1999 Basic education sub-sector investment Program project. Public service capacity building Program project. 2000 Mine township services project. Social investment fund project. Railway restructuring project. Fiscal sustainability credit project. 2001 Support to economic expansion and diversification tourism project. National response to HIV/AIDs project. 2002 Agricultural development support Program project. Emergency drought recovery project. Copperbelt environment project.
Appendix H – WTO Tariff-reduction Timetable and Product Coverage
The ITA provides for the "staging" of tariff reductions in four equal rate reductions (25% each time):
1st 1 July 1997 2nd 1 January 1998 3rd 1 January 1999 4th Complete elimination of duties no later than 1 January 2000
Product coverage
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World trade in IT products is significant – about $600 billion annually, or about 10.2 per cent of the world’s merchandise trade. There are six main categories of products covered by the agreement:
1. Computers (including complete computer systems and laptops as well as the components such as CPUs, keyboards, printers, display units (monitors), scanners, hard disk drives, power supplies, etc.).
2. Telecom equipment (including telephone sets, videophones, fax machines, switching apparatus, modems, and parts thereof, telephone handsets, answering machines, radio-broadcasting and television transmission and reception apparatus, and pagers.)
3. Semiconductors (include chips, wafers, etc… of various sizes and capacities)
4. Semiconductor manufacturing equipment (include a wide variety of equipment and testing apparatus used to produce semiconductors such as vapor deposition apparatus, spin dryers, etching and stripping apparatus, laser cutters, sawing and dicing machines, deposition machines, spinners, encapsulation machines, furnaces and heaters, ion implanters, microscopes, handling and transport apparatus, measuring and checking instruments, and parts and accessories.)
5. Software (contained in diskettes, magnetic tapes, CD- ROMs)
6. Scientific instruments (include measuring and checking devices, chromatographs, spectrometers, optical radiation devices, and electrophoresis equipment.)
Additionally, other main products of interest covered by the ITA include word processors, calculators, cash registers, ATM machines, certain static converters, indicator panels, capacitors, resistors, printed circuits, certain electronic switches, certain connection devices, certain electric conductors, optical fiber cables, certain photocopiers, computer network equipment (LAN & WAN equipment), flat panel displays, plotters, and multimedia upgrade kits. The ITA does not cover consumer electronic goods. 252
Leading exporters of IT products in 1995
1. Japan $106.6 billion 2. United States 97.99 3. European Union 15 (extra-EU exports) 57.07 4. Singapore (domestic exports) 41.27 5. Korea 33.22 6. Malaysia 32.84 7. Chinese Taipei 28.71 8. China1 4.51 9. Mexico 11.67 10. Canada 11.55
Total of above: $435.43 billion
Leading importers of IT products in 1995
1. United States $139.93 billion 2. European Union (extra-EU imports) 104.84 3. Japan 37.68 4. Singapore (retained imports) 24.72 5. Malaysia 22.22 6. Canada 19.81 7. Chinese Taipei 16.53 8. Korea 16.47 9. China1 4.35 10. Hong Kong (retained imports) 12.1
Total of above: $408.65 billion
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Appendix I – List of Interviewees Name Date Organization Location Note Victor Mbumwae August 2004 Ministry of Communications Lusaka Project Coordinator August 2005 and Transport – TICAD ICT Policy Project – Planning Unit Shuller Habeenzu August 2004 Communication Authority of Lusaka CEO Zambia Susan Mulikita August 2004 Communication Authority of Lusaka Legal Counsel August 2005 Zambia Marvis Ampah 3/20/2005 World Bank – Global Washington D.C. Senior ICT Policy Specialist Information and Communication Technologies Policy division (CITPO) John Munsaka August 2004 ZAMNET Lusaka Managing Director Mwewa Phiri August 2004 FirstFone Lusaka Managing Director August 2005 Mushota Kabaso August 2005 Central Statistics Office Lusaka Statistician Fr. Charles Chama August 2005 Yangeni Community Radio, Mansa Director Mansa Catholic Diocese Ziela Lungu August 2005 Lusaka Cybercafé Lusaka Owner Papa Ndiaye 3/21/2005 Emerging Markets Washington D.C. Director Partnership Simon Mulumbi August 2005 PANOS Southern Africa Lusaka Programs Assistant (Media Pluralism) Hastings Mtine August 2004 KPMG Zambia Lusaka Senior Partner Hamadoun Toure March 2005 ITU Telecommunication Washington D.C. Director Development Bureau (BDT) Nang’alelwa Sitwala August 2005 ZESCO Limited Lusaka Chief Engineer: Telecommunications Flavien Bachabi March 2005 INTELSAT Washington D.C. Regional Vice President, Africa and Middle East Palan Mulonda August 2005 Institute of Human Rights, Lusaka Board Member 254
Intellectual Property and Development Trust {HURID} Lubinda Mulozi August 2005 Zambia ICT Association Lusaka Founder Dr. Emmanuel Kasongo August 2004 ZAMCOM Trust Director Jetty Lungu August 2005 Africa Development Fund Lusaka Business Development Manager Chris Munyati January 2006, SavanaCom Lusaka Director March 2006 Dr. Fackson Banda August 2004 PANOS Lusaka Country Director Mwela Sheba January 2006 Copperbelt University Kitwe Lecturer Nason Bimbe August 2005, University of Sussex Brighton, UK Internet Information January 2006 Systems Officer