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BusinessEthiopia licenses consortium for telecom service

Ethiopia licenses consortium for telecom service

The Council of Ministers has unanimously voted to issue a single license of operation for the international consortium of telecom service providers for USD 850 million license fee, The Reporter learned.

MTN, another bidder for the second license, offered just USD 600 million, which the government deemed too small and cancelled it.

The global consortium of top-notch service providers including Vodafone, Vodacom, Safaricom, CDC, and Sumitomo have committed themselves to investing USD 8.5 billion within 10 years, advisor to the Ministry of Finance, Brook Taye (PhD) told The Reporter.

According to Brook, the consortium would create between 1.1 and 1.5 million jobs within those ten years.

The consortium will start its services with 4G and expand it to 5G, apart from launching a low orbit satellite to expand 4G services across the nation, Brook added.

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As the government was focused on the total investment these licensees would put on the ground, the offer by the bidder was satisfactory to the government, according to Brook.

“It is more than expected and the amount was really wonderful,” Brook added.

Speaking to The Reporter about the bidding process, Director General of the Ethiopian Communications Authority, Balcha Reba (Eng.) highlighted that the timing of the bid, the technological capacity at home as well as policy and legal frameworks were the perceived challenges before the bid went ahead. But the challenges fizzled out because of the transparency at every stage of the process.

The whole process was in line with the government’s digital 2025 strategy, the 10-year plan and the whole reform agenda the country is going through. The move is symbolic too as the process assured the country has to attract quality foreign direct investment in various sectors, he added.

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