ADDIS ABABA – Ministry of Finance has announced that preparation are finalized to partially privatize the Ethio-telecom and Sugar factories and opening of the sector for competition.
Ministry of Finance provided updates regarding steps being taken to privatize Ethio-telecom and sugar factories. The measures came following the government’s decision in October to revitalize its privatization program.
State Minister of Finance, Dr. Eyob Tekalign yesterday briefed the media about the current status of privatization process of Ethio-telecom and sugar factories. The Government of Ethiopia is set to open its telecom market for two international telecom operators.
As per the direction set by the government, two international telecom companies will join the telecom market in Ethiopia through bid, in addition to Ethio-telecom, he said.Ethio-telecom will be privatized with the Government of Ethiopia having 51 percent of the share. The remaining 49 percent share will be controlled by the winners. He further announced that Ethio-telecom has been split into two roles, namely an infrastructure and services division.
The infrastructure division will be responsible for managing the international gateway, the national optic fiber optic backbone network and passive element of the access to network including cellular towers. The service division will be responsible for managing all cellular, retail internet and fixed line service. The structure will provide greater cost transparency, which will facilitate for Ethio-telecom negotiates fair and transparent open access contacts with new operators.
The two sectors are open for bidders, according to the State Minister. He said the two international companies are expected to join Ethiopia’s telecom market next fiscal year. Dr. Eyob said that privatization of telecommunication sector will also facilitate Ethiopia’s push towards digital economy by closing gaps in digital infrastructure.
It will also enable the introduction and expansion of new technologies, he noted. Underpinning the reforms and planned competition, the government has strengthened the regulatory structure by enacting the communications Service proclamation which establishes a new independent telecom regulatory activity.
Ethiopian Communications Authority (ECA) has the responsibility to administer, monitor and enforce the telecommunications regulations and issue licenses for existing and new operators. Moreover it is anticipated that improved quality, higher speed and expansive telecommunication infrastructure will play an important role in preparing the country for high tech industrialization.
As the country develops its digital infrastructure new business opportunities are expected to emerge and create jobs for youths. Regarding sugar to utilize the country’s resource potential for sugar production, the Ethiopian sugar corporation since 2010 has been working to increase its production through expansion of factories to meet the growing local demands as well as exporting sugar to regional and international markets, Dr. Eyob Stressed.
To support this expansion program, the Ethiopian government is assessing restructuring options including contacting out management and operations, public private partnerships and full or partial privatization for sugar factories currently owned by the Ethiopian sugar corporation.
These reforms will strengthen management within the sugar sector, facilitate investment and the introduction of private sector capital as well as support export growth. In addition the privatization of sugar sector is also expected to expand business opportunities in areas such as animal feed, animal fattening, pulp and paper as well as alcohol production and among others.
The Ethiopian Herald July6/2019
BY HAILE DEMEKE
