The Ministry of Finance and the Ethiopian Communications Authority (ECA) have awarded a telecommunications license to the Global Partnership for Ethiopia consortium in a move that represents a major investment into Ethiopia’s telecommunications market, and opens up competition.
The entry of a new operator into Ethiopia’s telecoms market is designed to open it up to operators beyond the publicly owned incumbent, Ethio Telecom.
Two consortia initially submitted proposals. The first consisted of South African telecommunications giant MTN Group, supported by the Silk Road Fund, a Chinese investment fund. The second - and eventual winner, Global Partnership for Ethiopia - comprised Kenya’s Safaricom, Vodafone Group from the UK, South Africa’s Vodacom Group, CDC Group from the UK, Sumitomo Corporation from Japan, and the United States International Development Finance Corporation (US-DFC). The winning consortium was selected following a transparent process that began last October.
Finance minister Ahmed Shide said of the announcement: ‘Today marks a decisive day for our economic reform path in Ethiopia. With the liberalisation of the telecom market through a fair and transparent process, the government enables every Ethiopian to access quality services at an affordable price.’
ECA director general, Balcha Reba added: ‘This decision ushers in a new era of telecom service development in our country which will benefit millions of Ethiopians to have access to quality and reliable communication services. Global Partnership for Ethiopia is a consortium of reputable telecom companies providing service to over 750 million customers all over the world and committed to create new jobs, support the economy through introduction of new and efficient services. I am also very pleased the consortium will invest $8bn USD over the next 10 years.’
The entry of a new operator demonstrated the government’s commitment to the reform agenda that was introduced two years ago as part of the Homegrown Economic Reform Program, a package of economic reforms aiming to transform Ethiopia’s economy to create millions of jobs through private-sector-led growth, to develop manufacturing and other sectors, and to encourage foreign direct investment.
