This archive report was first published on 6 July 2021.
NAIROBI, Kenya - July 6, 2021
Kenya has maintained close ties with Ethiopia, with increased business activities between the two countries. This is evident in the recent award of a telecommunications license to Safaricom to operate in Ethiopia.
According to sources, Ethiopia considers Kenya a valuable partner and will not close its embassy in Nairobi. The Ethiopian government has granted an operating license to a consortium of firms, including Kenya's Safaricom, to operate in the country.
The consortium bid $850 million for the license, making it a significant investment in the country's telecommunications sector. The move is part of Prime Minister Abiy Ahmed's economic reform agenda, which aims to shake up the sector and bring in new investment.
Abiy's government had planned to award two new telecoms licenses, but only received two bids after some firms initially expressed interest opted not to submit. The second bid of $600 million from South Africa's MTN was rejected as not enough.
The Ethiopian Communications Authority has announced that the second license will soon be re-tendered. The licenses are expected to bring in an infusion of cash, jobs, and infrastructure investment.
The Safaricom-led consortium is set to create up to 1.5 million new jobs and bring in $8.5 billion in investment over 10 years. The consortium will provide 4G and 5G internet services, and by 2023, a low-orbit satellite will be put in place to provide nationwide 4G coverage.
