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Photo: Africa CDC

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Photo: Courtesy

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                          Boxer Achieng Wins Sports Personality Of The Month Award

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                          Boxer Achieng Wins Sports Personality of the Month Award

                          Rugby player Willy Ambaka in a past tournament. Ambaka announced his retirement from the sport on Thursday, January 26.PHOTO/COURTESY.

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                            Kenya’s School Reform is Entering a New Phase in 2023 – But the Country isn’t Ready

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                            IMAGE/Courtesy

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                            IMAGE/Roy Mwangi

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                            President William Ruto inspects a guard of honour in Nairobi, Kenya in September 2022. Simon Maina | AFP via Getty Images

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                              Ethiopia grants new telecoms license to Safaricom-led consortium to revamp sector

                              The consortium, which includes Vodafone and Vodacom, paid $850m for the license, officials say

                              by Monica Chang
                              March 8, 2022
                              in Business, Technology
                              0
                              Ethio Telecom launched its own mobile money programme, Telebirr, earlier this month | AFP

                              Ethio Telecom launched its own mobile money programme, Telebirr, earlier this month | AFP

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                              Ethiopia has granted an operating license to a consortium of firms including Kenya’s Safaricom, Vodafone and Vodacom, officials said Saturday, a move that will end the state’s monopoly over its stunted telecoms sector.

                              The consortium bid $850 million for the license, senior finance ministry adviser Brook Taye told AFP.

                              The shake-up of the potentially lucrative sector — currently dominated by state-owned Ethio Telecom — is a cornerstone of Prime Minister Abiy Ahmed’s economic reform agenda.

                              Abiy, who is running for a new term in hotly anticipated national elections next month, hailed the news on Twitter Saturday, saying the consortium’s bid “offered the highest licensing fee and a very solid investment case.”

                              He said the consortium would bring the largest infusion of foreign direct investment in Ethiopia to date, and that “our desire to take Ethiopia fully digital is on track.”

                              Abiy’s government planned to award two new telecoms licenses, but in late April it announced it had received only two bids after some firms that initially expressed interest — including France’s Orange and the UAE’s Etisalat — opted not to submit.

                              The second bid of $600 million from South Africa’s MTN was “not enough” and was therefore “rejected”, Brook said. 

                              Balcha Reba, director general of the Ethiopian Communications Authority, told AFP that the second license would soon be re-tendered.

                              Risk factors
                              Ethiopia is currently mired in a six-month-old conflict in its northern Tigray region, and tensions are running high with Sudan and Egypt over issues including disputed border territory and Ethiopia’s massive dam on the Blue Nile River.

                              These factors might have discouraged some firms from bidding for a license, said Chiti Mbizule, analyst at Fitch Solutions.

                              “Although operators tend to take a more long-term view of the markets they are looking to enter, for the more risk averse players, it can’t be ruled out that the political and economic outlook could play some role in their decision to hold off entering the market at this stage,” Mbizule said. 

                              Abiy is running for a new term in hotly anticipated national elections next month | AFP

                              Some companies might have also been put off by a central bank directive that had prevented foreign-owned firms from providing mobile financial services.

                              Ethio Telecom launched its own mobile money programme, Telebirr, earlier this month. 

                              At the launch ceremony, Abiy said Ethio Telecom would have one year to develop the service without competition, indicating other providers could soon get involved. 

                              The new telecoms licenses are expected to bring an infusion of cash, jobs and infrastructure investment. 

                              The consortium that has now been granted a license is set to create up to 1.5 million new jobs and bring $8.5 billion in investment over 10 years, Brook said.

                              It will provide 4G and 5G internet services, and by 2023 a low-orbit satellite will be put in place to provide nationwide 4G coverage, Brook added. 

                              “This is a great day for us and we’re very much excited,” he said. 

                              Ethiopia’s telecoms reforms also include a plan to sell a stake in Ethio Telecom, a move officials hope will make the firm more efficient.  

                              © Agence France-Presse

                              Tags: EthiopiaSafaricomTelcomVodacomVodafone
                              Monica Chang

                              Monica Chang

                              Monica is a Business and Technology News Writer and Contributor for The Kenya Times and its affiliates. She is also a photographer and an avid dog lover.

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