This archive report was first published on 10 August 2020.
On August 10, 2020, the Ethiopian government made a significant move that could impact the country's plans to liberalise its telecom market. The government has suspended the entry of foreign telecom infrastructure companies into the country, possibly slowing down the enthusiasm that arose after authorities announced plans to liberalise the market.
However, this decision may not affect foreign telecom service providers and operators, such as Kenya's Safaricom and its parent company Vodacom, who had submitted expressions of interest in buying a stake in Ethio Telecom.
As part of its home-grown economic reform agenda launched in 2019, Ethiopia made an official invitation to foreign telecom companies to buy a 40 per cent stake in Ethio Telecom in June last year. This move would end a long monopoly in the sector and attract foreign investment.
But the decision to bar foreign telecom infrastructure companies has been met with resistance from Ethio Telecom. The company's officials argue that they have spent billions of dollars on telecom infrastructure across the country in recent years and do not want foreign companies to benefit from their investments.
"The government has decided not to allow foreign telecom infrastructure companies. They will not be allowed to operate here," Ethio Telecom chief executive Frehiwot Tamiru told the media. The company intends to earn substantial amounts of money in rent from entrant companies by leasing out its existing infrastructure.
