The Ethiopian government has decided to increase the size of its planned stake sale in Ethio Telecom from 40% to 45%. The privatization process, which was previously postponed, was revived by the government last November to sell a 40% stake. At the same time, the government also resumed plans to issue a full telecommunications license for a third operator in the country. However, the finance ministry has now revised the plan and will now sell up to 45% of Ethio Telecom.
The telecommunications industry is a valuable opportunity for Prime Minister Abiy Ahmed’s efforts to liberalize the economy. Despite this, the recent nearly two-year war in the northern Tigray region has hindered attempts to attract investment in the sector. In May 2021, a consortium led by Kenya’s top operator, Safaricom, was awarded the first international telecommunications license with a winning bid of $850 million. Rival company, Safaricom Ethiopia, began commercial operations in October.
