Cwele encourages private companies to roll out broadband in rural areas

Cwele says government will enter into strategic partnerships with private companies to achieve ICT goals.

Telecommunications Minister Siyabonga Cwele. Picture: EWN.

CAPE TOWN - Telecommunications Minister Siyabonga Cwele says the government intends offering incentives to private companies to invest in rolling broadband out to rural areas.

However, he's told Parliament that privatisation isn't the answer to the problems in the information communications and technology (ICT) sector.

LISTEN: Cwele on broadband & ICT plans.

Cwele also says the ailing Post Office is a key strategic asset for the government and that it needs just under R4 billion to get back on track.

The minister says the government will enter into strategic partnerships with private sector companies to achieve its ICT goals.

But he says privatisation isn't on the table.

"Privatisation is not necessarily the silver bullet to the challenges we face."

The minister says companies are only interested in investing in wealthy areas because they want to make profits.

"There is a huge market failure because all investments are understandably in high-income areas. They're not in Harding where I come from. They're not in the majority of rural areas. But we understand the private sector is for profit."

Cwele says the new ICT policy will be finalised shortly and will offer incentives to business to invest in rural areas.

He says he's happy with the progress the Post Office is making in getting its house in order but that it needs R3.7 billion before it can start making money on its own.