Africa-Press Ethiopia<\/p>\n
In early January the US International Development Finance Corporation (DFC) gave the green light for a loan to support Vodafone in its bid to acquire a telecoms licence, though the timetable for the award process remains unclear.<\/p>\n
The COVID-19 pandemic and the eruption of conflict in Ethiopia\u2019s Tigray Region have diminished hopes about the rapid liberalisation of the country\u2019s telecoms market.<\/p>\n
Back in early December, British telecoms multinational Vodafone nonetheless managed to persuade the DFC to grant it \u201can up to $500m loan\u201d as part of its bid to land one of the two licences to be awarded. The company leads the Global Partnership for Ethiopia consortium, which includes its subsidiaries Vodacom and Safaricom.<\/p>\n
A conditional loan
\n\u201cThe DFC will provide financing through an up to $500m loan if the consortium ends up winning the tender. This is the normal process for bidders wanting to secure a conditional loan, and it doesn\u2019t mean they\u2019ll win the tender,\u201d said Brook Taye, senior adviser to Ethiopia\u2019s finance and economic development ministry.<\/p>\n
If the full amount were to be granted, the sum would be equal to half the investment required to purchase a licence, estimated at a cost of more than $1bn.<\/p>\n
The loan \u201cwill finance the design, development and operation of a new private mobile network provider and the acquisition of a mobile network provider licence,\u201d said the DFC in a statement dated 10 December.<\/p>\n
A serious contender
\nIn its search to secure funding to enter a market serving 110 million people, Safaricom, which owns a 51% stake in Global Partnership for Ethiopia, also indicated it was prepared to take on debt to finance the acquisition of a licence.<\/p>\n
Africa Insight<\/p>\n
Also receive offers from The Africa Report
\nAlso receive offers from The Africa Report’s partners
\nThe Global Partnership for Ethiopia consortium has enough financial and technical leverage to make it a top contender.<\/p>\n
The DFC explained that its loan to the consortium is long-term financing on favourable terms maturing between five and 25 years.<\/p>\n
A long process
\nInitially scheduled to take effect in March 2020, the liberalisation of Ethiopia\u2019s telecoms sector has been delayed numerous times. According to several sources, the project was slated to get off the ground before the upcoming general elections, but those elections were indefinitely postponed in March 2020 after the COVID-19 outbreak. Armed conflict also broke out in the Tigray Region later in the year.<\/p>\n
<\/p>\n","protected":false},"excerpt":{"rendered":"
Africa-Press Ethiopia In early January the US International Development Finance Corporation (DFC) gave the green light for a loan to support Vodafone in its bid to acquire a telecoms licence, though the timetable for the award process remains unclear. The COVID-19 pandemic and the eruption of conflict in Ethiopia\u2019s Tigray Region have diminished hopes about […]<\/p>\n","protected":false},"author":84,"featured_media":1527,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,3],"tags":[241],"class_list":["post-1526","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-community","tag-africa-press-ethiopia"],"yoast_head":"\n