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Wednesday, 31 October, 2001, 13:49 GMT
South Africa installs new privatisation boss
Telkom logos
Poor market conditions have delayed the telecom sell-off
South Africa has appointed an new privatisation chief after the finance minister announced a delay on Tuesday to the flagship sale of state-owned phone company Telkom.

Malixole Gantsho takes up his position as Head of Restructuring at the Department of Public Enterprise (DPE) on Thursday.

South African Finance Minister Trevor Manuel
Finance Minister Trevor Manuel delayed sell-offs
His predecessor Leslie Maasdrop is leaving the post five months before his contract expires but will continue in an "advisory" role.

"The two events are not related," a DPE spokesman told BBC News Online.

"He came from the private sector, and indicated he want to return when his contract expired. It's just unfortunate timing," he said.

The delay of the Telkom privatisation comes just days after the central bank announced the reintroduction of capital controls, which would make it more difficult for foreign investors to repatriate profits.

The Confederation of South African Trade Unions (Cosatu) earlier this year held national strikes over the rising cost of basic services and job losses, which have resulted from the move towards privatisation of state-owned enterprises.

Privatisation heads

Mr Maasdrop was a key figure in planning the sale of Telkom and power utility Eskom

He told South Africa's Business Day he had not found a private sector position yet, but would not serve on the board of any state-owned companies he had helped restructure.

His successor Mr Gantsho, a lawyer by training, was promoted internally from the position of director of performance monitoring and has held positions as a state prosecutor and in the private sector.

He heads the King Committee Task Team on Corporate Governance and served as board member of the national gambling regulator.

Last year, he resigned as chief executive of the Eastern Cape Gambling & Betting Board after allegations of improper conduct in his job.

Telkom delay

Finance Minister Trevor Manuel postponed the listing of Telkom and the sale of 20% of M-Cell, the country's second largest mobile operator, to 2002-3 because of weak market conditions.

Telkom is 30% owned by SBC of the US and Telekom Malaysia, and the listing of a 20% government stake would be the country's biggest privatisation so far.

"In light of the state of the world telecoms market, this (delay) was unfortunately inevitable," said Rudolf Gouws, chief economist at Rand Merchant Bank.

Speaking before Tuesday's decision, Nkenke Kekana, chairman of South Africa's Parliamentary Committee for communications, highlighted some of the dilemmas facing the government in hammering out telecoms policy.

"The balance here is between competition imperatives and on the other hand ensuring that people have services...universal service is very very key to our own managed liberalisation process," he said.

Mr Manuel cut revenue estimates from the sale of state assets to 3bn rand from 18bn rand on Tuesday as part of a mid-term budget statement.

Nkenke Kekana, chairman parliamentary committee
highlights policy difficulties in an interview prior to Tuesday's decision
Nkenke Kekana, chairman parliamentary committee
"Operators should pay [3G] licence fees...over a long period of time"
See also:

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28 Aug 01 | Business
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12 Jun 01 | Business
Investing in South Africa
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