Telecoms giant squares off with Harare

President Emmerson Mnangagwa has picked a fight with the country’s wealthiest businessman and the economy may be the loser. Under pressure from a plunging currency and massive inflation, Mnangagwa’s administration on 27 June restricted almost all mobile-money transactions in a country where 90% of commerce is conducted online because of cash shortages. On 17 July, the police accused Econet Wireless Zimbabwe, which dominates the mobile-cash system of money laundering. And Strive Masiyiwa, the businessman who founded and controls Econet denies the money-laundering allegations. In court papers, Econet CEO Douglas Mboweni said the accusations are a pretext for a ‘bolder move’. ‘There appears to be an agenda to destroy Econet and remove it from its market leadership position to the benefit of another operator,’ he said. A report on the News24 site notes that a complete shutdown of Ecocash could have dire consequences for the economy. About 7m transactions from 2m users were handled daily on its platform before the shutdown.

The animosity between Econet and the authorities dates back to 1998, when the company was founded, observes News24. Masiyiwa waged a five-year legal battle with former President Robert Mugabe’s government before he could get its licence. Since then, Econet has been accused of funding subversive activities, failing to remit taxes in foreign currency and refusing to comply with an order to share its infrastructure with state owned rivals. The report notes that it has been repeatedly threatened with a withdrawal of its licence.