Ethiopia Halts Sale of Ethio Telecom Shares, Pausing Key Privatization Plan
Ethiopia’s ambitious plan to sell a 35% stake in Ethio Telecom, the nation’s primary telecom operator, to foreign investors has been put on hold. This decision represents a significant shift in Ethiopia’s economic reform program, which aimed to attract foreign investment and modernize critical sectors, including telecommunications. The pause indicates a period of reassessment and strategic recalibration regarding the future of Ethio Telecom.
Rethinking Telecom Liberalization in Ethiopia
Sources suggest the proposed share sale will not proceed in the immediate future. Ethiopian authorities are now examining the potential implications of domestic shareholding on future privatization efforts. This includes evaluating how local investors could influence the trajectory of Ethio Telecom. For the time being, the government has no intention to sell additional shares, whether to foreign entities or domestic investors. Ethio Telecom has historically functioned as a state-owned monopoly, providing services to over 60 million subscribers. Its position among the largest telecom companies in Africa highlights the significance of this decision. The original liberalization efforts, initiated under the Homegrown Economic Reform Agenda in 2019, aimed to modernize the sector. Notably, in 2021, the Ethiopian government awarded a new telecom license to Safaricom Ethiopia, a subsidiary of Safaricom PLC (Kenya) and part of the Vodacom–Vodafone group, representing the first step in this reform agenda.
In conclusion, the pause on the Ethio Telecom share sale signals a pivotal moment for Ethiopia’s telecom sector. As the government reconsiders its strategy, the future of Ethio Telecom and the pace of broader liberalization efforts in Ethiopia remain uncertain, but also present opportunities for shaping the African tech landscape.
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