ADDIS ABABA – CEO of Ethio telecom, Frehiwot Tamiru said the state firm has settled 2.3 billion birr (over $45.3mln) in debt in the first half of the current fiscal year that started in July, 2021.
The CEO said this during a meeting with top officials of the Ministry of Finance and Public Enterprises Holding Agency to review Ethio Telecom’s six-month performance report on Monday.
The company reportedly had a non-guaranteed external debt portfolio of $780 million at the onset of the FY, with the balance expected to be paid back over the coming seven years.
In the first half of the budget year, the company spent more than 2.3 Billion Birr to settle debt, the CEO said, apart from 12.6 Billion Birr payments made in taxes.
The debt has been accumulated since 2013, with most of the loans invested in the expansion of the Next Generation Network and Telecom Expansion Project.
Reports put shortage of foreign currency as the main stumbling block for the company whose revenue shows a continuous growth, not to settle more of its debt.
Ethio telecom’s revenues grew by 6.7 per cent to a total of 28 Billion Birr in the first half of the budget year while its total subscribers number reached at 60.8 Million.
“Given the current challenging environment in our country, this achievement can be considered remarkable,” reads its’ performance report.
Apart from expanding revenue streams, Ethio telecom’s CEO Frehiwot said the company is executing a cost optimization strategy.
It has helped the company to save over 1.2 Billion Birr within the six months, she added.
According to the CEO, security, theft on its infrastructures and inflating cost of compensation in areas where infrastructure construction are ongoing have continued to be the major challenges for the company.
Finance Minister Ahmed Shide described the overall performance as strong, adding that the government will work in collaboration with the company to address the challenges.
Ahmed also appreciated the encouraging outcome of the coat optimization strategy, and urged its officials to do more in the area.
Above all, the Minister told officials of the state-run firm to aggressively work on the company’s preparation for the upcoming competition in Ethiopia’s telecom market. Ethio telecom is expected to face its first-ever competition from Safaricom Telecommunications Ethiopia, which is expected to start operations in April, 2022.