Feb 27 , 2021

The Ethiopian Communications Authority (ECA) is set to launch the final and long-awaited request for proposal (RFP) at the end of this week to issue two nationwide full-service licenses. The bid will be open for one month until April 5, 2021, and the National Evaluation Committee formed from the Ministry of Finance, the Authority, and the Prime Minister's Office will handle the technical and financial evaluations, which are expected to be finalised by mid-May.

At the end of last week, the Authority and the Ministry of Finance held a conference with the bidders before floating the final bid. During the two-day bidders' conference, which saw the attendance of representatives of Orange, MTN and Vodafone, among others, the Ministry of Innovation & Technology, the Ethiopian Investment Commission, the National Bank of Ethiopia, Ethio telecom, and the Office of the Prime Minister made presentations.

The bidders were briefed on the ICT policy and the digital economy of the country, mobile and financial services and investment laws. Technical requirements were also part of the briefing. Comments from bidders were also gathered for the final RFP.

The final version of the RFP that incorporates comments from the bidders will be launched on March 5, 2021, according to Balcha Reba, director general at the Authority, which got a new board of directors recently with Abraham Belay (PhD), minister of Innovation & Technology (MInT) replacing Getahun Mekuria (PhD), minister of Education, as board chairperson.

The new board also consists of Lelise Neme, commissioner of the Ethiopian Investment Commission, Shumete Gizaw (PhD), director-general of the Information Network Security Agency (INSA), and Abebe Abebayehu, former investment commissioner.

The two international operators will secure nationwide full-service licenses with Ethio telecom and will be licensed for 15 years. The license, which is subject to renewal, will enable the companies to provide mobile, internet and fixed call services.

Following one of the government's major decisions to liberalise the telecom industry, the Authority initiated the bidding process last May and announced an expression of interest (EOI). The EOI attracted the interest of 11 companies, including Global Partnership for Ethiopia, a consortium of Vodafone, Vodacom and Safaricom; MTN; Etisalat; Orange; Saudi Telecom Company;  Liquid Telecom; Telkom SA; and Snail Mobile.

The Authority then floated the first RFP at the end of November, and a total of 36 companies have shown interest in the RFP document, with some of them buying the bidding document. The bidders' conference was held last week with the attendance of these companies.

During the bidders' conference, the prospective bidders voiced their concerns regarding the closure of mobile financial services to foreign companies and to firms that manufacture or supply infrastructure, aka infraco companies. In letting two companies join the industry, the government has closed the doors to firms that manufacture or supply infrastructure. Though mobile money remains closed to foreign firms, the government recently allowed Ethio telecom to venture into the service.

"We've explained to the companies that it isn't a lifetime ban," Balcha said, "and informed them that policies might be changed or amended by the government when needed."

Once the monopolised telecom industry is liberalised, the country will follow a ''2+1 approach,'' in which two operators along with the state enterprise provide full telecom services for at least 10 years. With the new landscape, Ethio telecom will hold the existing mobile network code 09, while the two new operators will operate with 07 and 08 mobile network codes.

The International Finance Corporation (IFC) is operating as a transaction advisor in the process of assisting the Authority in the license issuance process and drafting directives and a regulatory legal framework. So far, the Authority has prepared 16 draft directives, a regulation and a framework, of which 12 of the directives and the framework have been approved.

PUBLISHED ON Feb 27,2021 [ VOL 21 , NO 1087]

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