‘The Biggest Prize Left In Africa’: Safaricom, Vodacom Plan Joint Bid For Ethiopian Mobile Operator License

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Written by Peter Pedroncelli
Until now, the Ethiopian government has controlled the country’s mobile services. Ethiopia plans to award telecommunications licenses to two new operators in 2020. Ethiopian Prime Minister Abiy Ahmed at the European Council headquarters in Brussels, Thursday, Jan. 24, 2019. (AP Photo/Francisco Seco)

Kenya’s Safaricom and its South African parent company Vodacom Group are planning a joint bid for an Ethiopian telecommunications license which is expected to cost as much as $1 billion.

Ethiopia plans to award telecommunications licenses to two new operators in 2020, Moneyweb reports.

The two mobile operators are expected to apply for one of the two available permits in a consortium alongside two unnamed financial institutions, according to Safaricom CEO Michael Joseph.

Bidding for an Ethiopian mobile operator license

A successful bid for one of the two available licenses is expected to be in the billion-dollar range, Reuters reports.

Mobile operators including France-based Orange and South Africa’s MTN and Vodacom groups have all shown interest in the Ethiopian market, according to the Ethiopian finance ministry.

Ethiopian Prime Minister Abiy Ahmed is opening up the telecoms sector as part of his agenda to boost one of the world’s fastest-growing economies and attract foreign investment. 

State-owned provider Ethio Telecom enjoys a monopoly in the East African country. Ethio Telecom is expected to be partly privatized in early 2020.

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Ethiopia, — population, 108 million people — could be a major market for any new entrant.

Safaricom CEO Joseph has referred to Ethiopia as “the biggest prize left in Africa from a telecoms point of view”.

Once the license is secured, Joseph said he believes that another $1 billion may be required to build the required network to compete with Ethio Telecom and others, according to Moneyweb.