Ethiopia to break up its telecoms monopoly - TechCentral

Ethiopia to break up its telecoms monopoly

Ethiopia will split its state-owned telecommunications company and sell stakes in the two new entities piecemeal to international operators, Prime Minister Abiy Ahmed said.

Ethiopian Telecommunications, or EthioTelecom, has more than 60 million mobile and fixed-line subscribers, dominating a phone market that’s long been coveted by MTN Group and Vodacom Group, Africa’s biggest wireless operators by sales and value respectively.

“Certain amounts of shares will be sold gradually in 10, 20, 30 years,” Abiy told lawmakers in the capital, Addis Ababa, on Monday. “We are not giving it up in one go, it is not possible.”

Ethiopians will be offered 5% in the new companies, and between 30% and 40% will be sold to telecoms operators that are top-10 players globally. There’ll be at least a year or two of “intensive study”, he said in televised comments.

Abiy, who took office two months ago, is speeding up long-awaited market reforms such as liberalising state companies and reducing the role of the military in the economy. Ethiopia’s output has expanded faster than any other in Africa over the past decade and is poised to grow by 8.5% this year, according to the International Monetary Fund.

Ethiopians in the US$80-billion economy apply for between 1 000 and 1 200 new Sim cards daily and keeping the company as a monopoly denies subscribers the benefit of competition and the nation much-needed income, Abiy said.

“Keeping it the way it is now is dangerous; transferring it like some other African countries can be disastrous too,” he said.  — Reported by Samuel Gebre, (c) 2018 Bloomberg LP

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