In a statement on Monday, TelOne, which is one of the biggest players in the internet service providers in Zimbabwe as well as the sole operator of fixed telecoms, announced the revision of its pricing across its product range in consideration of the MPS exchange rate liberalisation.
Announcing the price increase the state owned operator said “we note the announcement of a rate of exchange between the US Dollar and the RTGS Dollar. We further note and point out that our tarrifs and charges are currently denominated in the USD dollar.”
“With this observation, TelOne would like to advise that our tarrifs and charges will remain unchanged in the USD terms. We will however, now have tariffs and charges indicated in RTGS$ as well,” the company further stressed.
TelOne joins other service providers notably ZOL which is a close competitor in the broadband space in adjusting prices following the February’s exchange rate regime liberalization through the MPS.
The RBZ had maintained a fixed exchange rate regime despite evident currency divergence and unofficial re-emergence of the local currency. Grappled with acute shortages and forex challenges, the Bank finally relented and partially floated the exchange rate to allow an interplay of market forces.
On debut, interbank trading, the RTGS$, which is the new name for the local currency traded at 1:2.5 against the US Dollar which was mainly a government controlled introduction rate. In successive trades the local currency has plummeted against the USD and is nearing the 1:3 mark.
The move by internet service providers to adjust the prices of their products is largely in line with the broader sector which appears to be moving closer to full pricing in of the exchange rate.
Delta which is a key player in the beverages space adjusted its prices earlier in the year after a protracted battle with the authorities. The Central Bank had promised to provide forex in line with the companies’ monthly demand. Delta was facing severe inputs crisis which in turn dampened supply.
The liberalisation of the exchange rate and the subsequent introduction of the interbank forex trading platform, is expected to unlock forex liquidity and help recapacitate industry. It is also expected that government subsidization of the economy will significantly be reduced.