The Government of Ethiopia invited strategic partners for Expression of Interest in Engagement of Strategic Partnership for public fixed and mobile telephone business of Ethiopian Telecommunications Corporation (ETC) for the acquisition of a 30% stake plus management control in the corporation while the State Telecom would continue to remain the key provider of the major telecom services in the country.

Fixed telephony, cellular, Internet, public data, analogue and digital leased lines; telex businesses and services have so far been fully owned and managed by the Ethiopian government.

It was also highlighted that the ETC has a public fixed installed network of approximately 351,600 customer connections and a tele-density of 0.36 per 100 for a population of 62 million, thus, placing the country among the lowest in Africa.

On the other hand, the mobile unit of ETC operates in the GSM 900 MHZ frequency range covering Addis and its immediate environs for a subscriber base of approximately 42,900 contract customers. It had enjoyed net assets valued at $303 million and an operational revenue of $95 million as of 30 June, 2001. It was against this background that the Government of Ethiopia invited Strategic Partners for 30% capital participation.

The established set of pre-qualification criteria consisted of relevant telecom experience covering operations, management and technical advisory services with experience of successful network expansion plus a balance sheet with net assets of more than $10 million. Potential Strategic Partners are also advised to pre-qualify individually and or in consortia. Enquiries and requests for information profile would directed to the Ethiopian Privatization Agency.

ICT Focus had approached the Ethiopian Telecommunications Agency (ETA) - the regulatory arm of the government - for a comprehensive assessment of the intentions, goals and objectives for the invitation of the Strategic Partners. It was learnt that the ETA was not aware of the whole process and directed us to the Ethiopian Privatization Agency - entrusted with the sale of the 30% share - to obtain the required information.

We were able to contact the PR Department of the EPA but could not have access to the information profile. What we can imagine at the moment is that the complaints about the poor services, the growing need and unmet demands for telephony and the push by the International Monetary Fund and the World Bank to privatize the sector might have led the Government to make the decision for 30% private capital participation.

The deadline for submission of Expression of Interest is Sept. 30, 2002 and short-listed strategic partners will be contacted within two weeks from the closing date. The strategic partners would be engaged by early 2003.