Ethiopia opens bidding for two new full service telecom licences

NAIROBI, Nov 27 (Reuters) - Ethiopia opened the doors on Friday for telecom operators wishing to secure two new telecom licences to submit their technical and financial bids.

The Horn-of-Africa nation’s telecoms industry is considered the big prize in a push to liberalise the economy because of a huge protected market, which serves more than 100 million people.

Prime Minister Abiy Ahmed is pressing ahead with the auction of the new licences and the sale of a 45% stake in state monopoly Ethio Telecoms, in spite of a military conflict in the northern Tigray region.

“We have now arrived at a crucial moment,” said Brook Taye, a senior adviser at the finance ministry.

Firms have until March 5 to submit their bids, and the winning two will be announced within 14 days, said Eyob Tekalign Tolina, state minister at the ministry of finance.

Winners will be given full operating licences in Ethiopia, but they will not be allowed to offer mobile phone-based financial services, Eyob said.

They will also be required to set up their own network infrastructure like cellphone towers, Brook said.

Eyob dismissed concerns that the fighting in the north was a worry for investors, saying the federal government troops have encircled local Tigrayan forces around the regional capital of Mekelle.

Telecoms executives have said that prolonged conflict or other instabilities could reduce the appeal of the market and the potential price for the licences.

Kenya’s top operator Safaricom, which expressed interest in a consortium with Vodafone and Vodacom estimated last year it would have to pay about $1 billion for a new licence.

Other firms that expressed interest include South Africa’s MTN, UAE’s Etisalat and French operator Orange SA .

Reporting by Addis Ababa Newsroom; Writing by Duncan Miriri; Editing by Elaine Hardcastle