Home Telecoms & Mobile Ethiopia To Issue Second Telco License in January 2022

Ethiopia To Issue Second Telco License in January 2022

by Penelope Nhyira
Ethiopia To Issue Second Telco License 2022

About a second telco license, Ethiopia has requested proposals for a second private telecoms operator to compete with incumbent Ethio Telecom and Safaricom, which was licensed earlier this year. This second telco license is to be issued in January 2022

A request for proposals (RFP) for a second full-service telecommunications license has been issued by the Ethiopian Communications Authority (ECA).

The ECA said yesterday that it is asking both international and domestic telecommunications businesses to participate in the confidential bidding process regarding the second telco license.

The new license, dubbed Licence B by the ECA, will be awarded in January 2022. According to the ECA, the deadline for responding to the RFP is December 20.

“The purpose of liberalizing our telecoms sector has always been to foster competition and encourage increased private sector investment as a critical aspect of Ethiopia’s digital transformation,” said Balcha Reba, director-general of the ECA.

The winner of the new license, according to the ECA, will be able to provide mobile banking services and will receive additional spectrum allotment. “Prequalification standards will have been amended to include participation from a wide variety of foreign and national telecoms operators,” the regulator said.

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The initial stand to second telco license

Ethiopia had intended to introduce two private competitors to Ethio Telecom, but only one offer met the criteria: that of the Global Partnership for Ethiopia, which is sponsored by Safaricom, Sumitomo, Vodacom, and Vodafone, as well as government funds from the United Kingdom and the United States. The company will be known as Safaricom, and the consortium has stated that it will invest $8 billion in infrastructure. MTN placed a lower bid for that license.

At the same time, the government began the process of selling a 40% interest in Ethio Telecom two weeks ago. Orange has already expressed an interest in bidding.

Ethiopia To Issue Second Telco License
Second Telco License

According to the ECA, the Safaricom consortium “has promptly established its local offices in Addis Ababa and is prepared to launch its services to the Ethiopian people” since gaining the first license.

“Following our successful initial license issuance to one of the world’s leading multinational telecoms consortia earlier this year, we have continued with our mission and now want to invite more telecoms operators of all sizes to be part of this exciting opportunity,” Balcha added.

He explained that part-privatization of Ethio Telecom was a “different procedure” that would be completed before the deadline for the second telco license for Licence B bid submissions.

He went on to say that at the end of the licensing process, Ethio Telecom, Safaricom Telecommunications Ethiopia, and the new Licence B holder will all have licenses to provide high-quality telecommunications services in Ethiopia.

The ECA stated that “following a comprehensive review of the proposals according to the predefined criteria, the final decision will be published, and the Licence B will be issued to the winning applicant, in accordance with the Ethiopian Communications Services Proclamation.”

December Deadline for second telco license

The deadline is December. The tendering procedure, which is taking place concurrently with Ethio Telecom’s partial privatization, will be “both transparent and fair,” according to the Authority.

The partial privatization of Ethio Telecom is a distinct process that must be completed before the License B bid submission deadline.

According to the ECA, bidders have until December 20, 2021, to respond to the new RFP, which contains Investment Considerations, Tender Regulations, and the information of the License to be given.

Takeaways to second telco license

In a nutshell, Ethiopia has issued a request for proposals (RFP) for a second full-service telecommunications license. The new license, dubbed Licence B by the ECA, will be awarded in January 2022. Ethio Telecom and Safaricom were licensed earlier this year. According to the ECA, the Safaricom consortium “has promptly established its local offices in Addis Ababa and is prepared to launch its services to the Ethiopian people” since gaining the first license. “Following our successful initial license issuance to one of the world’s leading multinational telecoms consortia earlier this year, we have continued with our mission and now want to invite more telecoms operators of all sizes to be part of this exciting opportunity,” Balcha added.

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