(Ecofin Agency) - Mozambique has just created an incumbent telecommunications firm baptized Mozambique Telecom. This telecom firm is the result of the merger of state-owned firms Telecomunicações de Moçambique (TdM) and Moçambique Celular (MCel), decided during the ministerial council of July 26, 2016, following financial problems experienced by those two companies.

Those problems were revealed in 2015 by the prime minister Carlos Agostinho Rosário during a visit to the two companies.

At the time, TdM needed $500 million to solve its problems. In addition, the local media A Verdade indicated that up to 2016, Moçambique Celular had a net debt of 12.8 billion meticais ($207,102,976), out of which 5.1 billion meticais was owed to suppliers and 3.8 billion meticais to national as well as foreign banks.

During the ministerial council of July 2016, Mouzinho Saíde, then spokesperson for the council, declared that the new firm “will have technological, financial and human resources able to meet the market’s need and will reach the convergence of voice, data, fixed and mobile internet services”.