More Africa NewsEthiopia once again suspends the process of awarding the second private telecoms license

November 21, 2023by myles0

The process of awarding Ethiopia’s second private telecommunications license was launched in September 2021, then suspended in December of the same year. It was finally relaunched in November 2022.

Ethiopia has canceled the procedure for awarding the second private telecommunications license (License B), Reuters reports . The news agency quotes Hinjat Shamil, a senior advisor at the Finance Ministry, responsible for overseeing the tender process.

“  The licensing process has been interrupted. We had not yet issued a tender, as we wanted to assess the market potential and readiness  ,” Ms Shamil said.

Last June, the Ethiopian Communications Authority (ECA) launched the call for qualifications for the award of License B, setting the deadline for September 15. The deadline was later extended to October 6 “  at the request of several potential investors  .” Telecommunications giants such as the French Orange, the Emirati Etisalat and the Dutch Veon have shown interest.

State Minister Eyob Tekalign recently told Reuters that companies have submitted qualifications for the second international license, but finding a suitable candidate will take longer than expected. However, sources familiar with the matter told Bloomberg last week that Ethiopia has not received offers for License B due to ongoing conflicts in parts of the Horn of Africa.

The launch of the call for qualifications follows the relaunch, in November 2022, of the process of introducing a third telecommunications operator in Ethiopia. A call for proposals was launched in September 2021, but was suspended in December of the same year.

The initiative is part of the process of liberalization of the national telecoms market initiated by the Ethiopian government in 2020. The first stage saw the Global Partnership for Ethiopia (Safaricom Ethiopia) consortium acquire the country’s first private telecoms license. The second stage is underway and concerns the partial privatization of the historic operator Ethio Telecom up to 45%.

Once completed, the liberalization of the Ethiopian telecoms market should notably make it possible to accelerate the development of the telecommunications sector by introducing more competition. A thriving telecoms sector should not only guarantee quality services to populations, but also contribute to the economic development of the country.

As a reminder, Ethiopia has 119 million inhabitants for a mobile telephony penetration rate of 38.5%, according to statistics cited by the Kenyan company Safaricom in its financial results for the first half of 2023/2024. Safaricom Ethiopia has 5 million mobile subscribers and 1.2 million users for the M-Pesa mobile money service. The historic operator Ethio Telecom had, as of June 30, 2023, 72 million subscribers, including 34.3 million subscribers to the Telebirr mobile payment service.

Source: Agence Ecofin

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