By 
By Kwanele Dhladhla
Parliament has raised strong concerns over the lack of adherence to appropriate corporate governance principles after HUAWEI (an EPTC contractor and vendor), which was granted a two-year contract valued at E126 million for modernisation, paid bills for top management, including MD Themba Khumalo, for a recent trip to Cape Town.
In the Parliamentary Select Committee report, which was tasked with investigating the financially dwindling government parastatal, HUAWEI Chief Executive Officer Bao Zheng (Chris) admitted that they had sponsored the trip by the governmental parastatal executives.
“All industry players are invited to attend, and HUAWEI does not sponsor unless a request has been made by an entity. In this instance, the Technical Engineer, MD, Chief Marketing Officer (CMO), and Chief Technical Officer (CTO) attended,” he informed the committee, which was led by Mtfongwaneni, Member of Parliament (MP), Nathi Hlophe.
HUAWEI is a vendor offering services to EPTC. It has a contract with EPTC for modernisation. Zheng explained that in the technology industry, systems must be upgraded every three to five years, as technology continues to evolve.
EPTC offers a backbone infrastructure for other industry players to ride on in the Kingdom of Eswatini.
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The admission by Zheng was prompted by a question of whether the sponsorship was done as a favour to influence the entity they seek to continue servicing.
“It does not paint a good picture for an entity that buys from HUAWEI to also receive trip sponsorships from the vendor,” Parliament noted.
However, the CEO denied any undue influence because of the sponsorship and emphasised that HUAWEI has a strict policy against any form of bribery.
“HUAWEI has a strict policy, especially when it comes to bribes or kickbacks. It is surprising because HUAWEI complied in terms of their policy and had thought that EPTC had also complied in terms of their policy as well and that the trips had been approved prior,” the CEO insisted.
In another separate incident regarding travel, the committee also inquired whether it was true that the Managing Director (MD), Themba Khumalo, and Board Chairperson Mtiti Fakudze recently travelled to Barcelona (Spain).
However, the issue was neither denied nor confirmed by the board during its appearance before the committee. There was an acknowledgement that indeed the MD and Board Chairperson to Barcelona recently travelled to Spain to seek funding for the financially struggling corporation, which has seen a drastic decline in revenue over the years.
“It is true that the Board Chairperson and MD travelled to Barcelona and the trip was to seek potential funding for EPTC and to benchmark, where meetings were held with EXIM Bank, as the government has mandated EPTC to seek funding.
The EPTC Board was appraised of it,” the board representative told the committee.
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The committee was also informed by Khumalo that financing has been sought from international funders.
“EPTC is currently seeking funding of about E0.5 billion from outside and is awaiting the Cabinet’s approval,” reads the report in part.
During the appearance before the committee, where he was accompanied by the Chief Financial Officer (CFO), Khumalo submitted that funding was being sought because the entity could not continue using dividends, and MTN dividends were decreasing.
“If it were not for the dividends, EPTC could have long collapsed,” Khumalo said.
The committee also learnt from Khumalo that a request was made to the government for EPTC to write off the government debt if Eswatini Revenue Service (ERS) did the same (E290 million tax) for EPTC. It was mentioned that as of 2024, 70 per cent of funds go to salaries, which meant the wage bill was too high.
