ADDIS ABABA – Ethiopia has moved closer to liberalizing its telecom sector after pushing ahead with plans to sell two new telecommunications licenses on Thursday.
The Ethiopian Communications Authority – a government agency put in charge of managing the license issuance process – has opened a month-long window for potential buyers to submit expressions of interest.
Ethiopia announced its plant to issue two new licenses to telecommunications companies, in addition to the existing license held by Ethio Telecom, almost two years ago as part of its effort to introduce competition into the sector.
“The launch of the EOI represents a significant milestone,” said the authority today.
The authority has already hired the International Finance Corporation (IFC) as a transaction advisor, and currently engaged in drafting numerous directives that will shape a robust legal and regulatory framework.
“The sector liberalization process is continuing amid the Covid-19 crisis which shows the government’s strong will to fight the pandemic while keeping track of the ongoing economic reforms,” it said.
According to the authority, the current pandemic has underscored the importance of having reliable and accessible telecommunications to ensure the safety and well-being of Ethiopians and to maintain business continuity.
“Therefore, we remain committed to opening up the telecom sector and unlocking the transformational power of the digital economy,” the authority said.
Two nationwide telecommunications service licenses will be awarded to two qualified telecommunications companies.
It will be a “competitive bidding process,” according to Ethiopian Communication Authority or ECA’s statement.
The authority published the first three of a dozen draft directives to guide operations in the sector including dispute resolution in April.
The government’s initial plans to issue licenses by March 2020 were disrupted by the decision to hold elections on Aug. 29, which the government later postponed indefinitely due to the virus outbreak.
Apart from offering two new licenses, the country plans to sell part of the state-controlled monopoly, Ethio Telecom, to help liberalize the economy and attract more foreign capital. Consultancy firm KPMG completed a valuation of the company, now under review by the board.