The government of Ethiopia – which has a long history of controlling the country’s economy – will allow domestic and foreign investors acquire minority holdings in the state-run operator Ethio Telecom.
The move is a departure from the longstanding policy of the Ethiopian People’s Revolutionary Democratic Front coalition – the ruling party that has been in power since 1991. During this time, it has advocated a monopoly on telecoms and pushed the state’s control of the economy.
Now, Prime Minister Abiy Ahmed is implementing economic reforms to capitalise on Ethiopia’s ranking by the International Monetary Fund as Africa’s fastest-growing economy. A government statement appeared to acknowledge the importance of “overseas investors “with knowledge and foreign capital” that could “play a critical role in our growth”.
“While majority stakes will be held by the state, shares in Ethio Telecom, Ethiopian Airlines, Ethiopian Power, and the Maritime Transport and Logistics Corporation will be sold to both domestic and foreign investors,” continued the statement.
Ethiopia is one of the last African countries to retain a state monopoly on telecoms. Allowing foreign investment in previously closed-off sectors would mitigate a scarcity of foreign exchange. Last month, Ethio Telecom confirmed that it would allow local private companies to use its infrastructure to deliver internet services, driving greater competition in the market.