The US International Development Finance Corporation (DFC) loaned up to half a billion dollars to a consortium of companies led by Vodafone to create a new operator to enter the Ethiopian market.
In a statement, the government arm said the $500 million will fund the “design, development, and operation of a new private mobile network provider” and the acquisition of a mobile network provider license in Ethiopia.
The DFC noted the project is expected to have a “highly developmental impact” by boosting connectivity in Ethiopia through the use of “trusted technology”.
The money is part of a larger $2.1 billion package to be invested during this quarter in: Africa, Eastern Europe, Indo-Pacific, Latin America, and the Middle East.
“The financing approved by DFC will be critical in facilitating private sector investment to increase economic growth in developing countries, especially in continuing to respond to the economic and health impacts from the pandemic,” said Adam Boehler, US International Development Finance Corporation chief executive.
Ethiopia’s telecoms market is seen as one of the last untapped in the world. It was opened for foreign investment by the government and has attracted a host of interested parties looking to tap into the 100 million population of Ethiopia.
The Ethiopian Communications Authority decided to allow only three mobile operators in the country, meaning there are only two new mobile operator licence up for grabs for foreign investors, with the third being incumbent state-owned Ethio Telecom.