Safaricom-led consortium dubbed “Global Partnership for Ethiopia” has signed a licence agreement with the Ethiopian Government after being announced as the winner of one of the two telecom licenses that were on offer in the second-largest country in Africa by population.
The consortium made up of Vodafone, Japan’s Sumitomo, and UK finance agency CDC Group completed the payment of the $850 million licence fee on Wednesday 2nd June 2021 according to Ethiopian authorities.
National Bank of Ethiopia Confirms Payment
“Now, the consortium has paid the 850 million USD licensing fee to the Ethiopian government via the National Bank of Ethiopia without any pressure under the signature of the provider and license winner,” Mr Balcha Reba, the director-general for Ethiopia Communication Authority was quoted by media.
The consortium will establish a new operating company in Ethiopia with the aim to start providing telecommunications services from 2022. It plans to invest up to US$8.5 billion in infrastructure among other areas and will create up to 1.5 million job opportunities. The investment is considered the most significant foreign direct investment into Ethiopia to date.
According to Safaricom CEO Peter Ndegwa, Safaricom will hold an estimated 55.7% in the business and the holding company for the consortium will be held in the Netherlands mainly because the Netherlands has bilateral investment treaty with Ethiopia.
Ethiopia is the second-largest country in Africa by population with more than 112 million people. The country is one of the last countries in the world to introduce competition in the telecom industry, a rigorous process started by the government in 2019 as part of its Economic Reform Agenda.
READ;
Safaricom led Consortium clinches US$ 850 Million Ethiopian licence
Ethiopia Relaxes Cash repatriation restrictions for Safaricom led Consortium
