Authority Consults with Telecom Firms over Licensing Process

ADDIS ABABA – Ethiopia’s Communication Authority (ECA), a state-run body responsible to liberalize and regulate the telecom sector, has held its first consultation with potential investors on Tuesday.

The consultative meeting has brought several foreign firms including telecom operators, telecom equipment providers as well as system installers together.

The authority said the meeting is a part of its effort to collect inputs from stakeholders about the planned telecom market opening and regulatory framework for the sector.

It said inputs would feed into the formal request for bids from potential operators, ahead of the competitive selection process.

The process is expected to conclude in March 2020 with the award of two new full-service telecom licenses for private telecom operators.

Balcha Reba (Eng.), Director General of ECA, said the authority intends to create transparent bidding and award licensing procedures and further engagement conditions.

The meeting is, therefore, “very important to collect inputs and feedback” from “concerned stakeholders for licensing process”, the director told reporters ahead of the meeting.

The licenses to be granted will be renewed every 15 years.

The opening up of the telecom sector for foreigners in mid-march will eventually end the monopoly of the state-owned Ethio Telecom.

The government also plans to sell off minority stake of Ethio Telecom, the current monopoly operator, to foreign firms. Major foreign telecom service operators are currently expressing their interest to buy stakes in Ethio Telecom, which has collected $344mln revenue in the first quarter of the current fiscal year alone.

The government is “liberalizing strategic sectors such as telecom” in a bid to enhance the quality of services and improve access, said Ahmed Shide, Finance Minister, while speaking at the consultative meeting.

“We have slotted key state-owned enterprises to the private sector like, telecom, energy, sugar, logistics, railway and industries for partial or fully privatization,” he said

“These reforms in the strategic service sector are aimed to unleash the potential of our economy across all sectors,” the minister added.

Ethio Telecom had already appointed international consulting firm KPMG to help with a process aimed at selling off stakes in the telecom.

The ministry of finance, on the other hand, had issued an expression of interest for a transaction advisor to help guide it with issuing licenses for other operators who would enter the telecoms sector.

Ethiopia’s telecoms industry is considered the big prize in a push to liberalize the country’s economy because of its huge protected market serving a population of around 100 million.