Ethiopia to sign a contract with Chinese companies to expand mobile coverage to 40 million subscribers

Ethiopia will sign an agreement with China’s ZTE Corp and Huawei Technologies Co Ltd in a ‘few weeks’ to expand its mobile phone infrastructure and double subscribers to 40 million, a senior Ethiopian official said on Thursday. ZTE Corp, China’s second-largest telecoms equipment maker, has already been involved in developing phone and internet services in the Horn of Africa nation for several years. Africa’s rapidly expanding telecoms industry has come to symbolise the continent’s economic growth, with subscribers across the continent totalling almost 650 million last year, up from just 25 million in 2001, according to the World Bank. “We are now poised to start the expansion. We are almost on the final stage on dealing with … ZTE and Huawei,” said Debretsion Gebremichael, Ethiopia’s deputy prime minister and minister of communications and technology. “In a few weeks we will conclude the agreement and we will start the expansion,” he told Reuters.

Debretsion declined to say how much the new deals with the Chinese equipment suppliers are worth, but said the two firms would finance the project.

Though lacking much of a telecoms industry, the government approved a directive late last year allowing private companies to provide value-added services — essentially all services other than standard voice calls. Ethiopia’s ministry of communications and information technology has received applications from 218 firms to provide such services, Debretsion said, while South Africa’s MTN Group — Africa’s largest mobile phone company — has already been granted a licence. Debretsion said preparations are also underway to launch mobile banking services. Ethiopia and Zimbabwe are the only countries on the continent who have yet to provide such a service. “It’s a matter of preparation with application providers because the banking system is within the government and we have to agree and we have to comply as well with the directives we have,” he said. “It has nothing to do with infrastructure now, it’s about application. Any time we can start.” Mobile banking is expected to grow into a USD 22 billion industry across Africa by 2015 on the back of the saring use of cell phones and growing demand for financial services, according to consultancy Juniper Research.

Source: Fana BC