France Telecom, the French state owned telecommunication provider, has been selected to manage Ethiopian Telecommunication Corporation (ETC), Ethiopia’s state-owned telecoms provider, after beating South African and Indian bids, a government official has disclosed.
ETC attracted many foreign companies when it floated a bid, a few months ago, inviting firms to undertake its management in a revenue sharing agreement. However, only the three companies remained for the final selection process, according to the source.
MTN, a South African based telecoms company represented in 21 markets in Africa and the Middle East, and Bharat Sanchar Nigam (BSNL), an Indian state-owned telecommunication company, lost the final bid to the French firm.
Negotiations between France Telecom and ETC are still ongoing, but the former is expected to sign the deal and take over the management of the latter within three months, according to the official.
Ethiopia’s move to hand over the management of ETC to a foreign company has been described by many local politicians as a first step towards liberalisation. The Ethiopian government’s monopoly of, and refusal to liberalise, the telecoms sector was widely criticized by many of its foreign partners, including the IMF.
According to the terms of the deal, the French firm will introduce new schemes to reform the state run telecom’s core operations, ranging from service provision to infrastructural maintenance. France telecom is also expected to earn the ETC huge revenues by creating new markets.
ETC is currently embarking on a massive 1.5 billion dollar expansion of all of its telecom services. Improvements include; the offer of various local and international language choices; a 997 information service; building a fibre optic network in order to create an efficient internet connection for the nation, 90 percent of which should be covered by the increasingly popular 3G CDMA phones.
France Telecom will not be responsible for the ongoing Chinese ZTE-run projects, which involves the development of Ethiopia’s nationwide network to cover 14 major cities, the source said.