Uhuru witnesses Safaricom licence award signing in Ethiopia

Ethiopia PM Abiy Ahmed and President Uhuru Kenyatta at Bole Airport on June 8, 2021/ PSCU

President Uhuru Kenyatta on Tuesday arrived in Addis Ababa, Ethiopia, for an official visit during which he is scheduled to witness the issuance of a telecommunications license to Safaricom PLC, State House said.

President Kenyatta was received at Bole International Airport by his host, Ethiopia Prime Minister Dr Abiy Ahmed.

He is accompanied by Cabinet secretaries Raychelle Omamo (Foreign Affairs) and Joe Mucheru (ICT).

An international consortium led by Safaricom, and comprising of Vodafone and Vodacom, UK’s CDC Group and Japan’s Sumitomo Corporation, won a Sh91.8 billion bid to operate in Ethiopia.

“ I welcome to Ethiopia my brother Uhuru Kenyatta, President of the Republic of Kenya, who joins today in a monumental moment for Ethiopia as we sign the telecom licensing agreement,” Abiy tweeted.

He said the consortium won the bid for “offering the highest licensing fee and a very solid investment case”.

The Ethiopian Communications Authority had earlier listed 12 firms including Safaricom last November as among firms that had expressed interest in entering the country’s telecommunications market. South Africa’s MTN were among the bidders.

Ethiopia hopes the investment will create millions of online job opportunities. The awarding of the new licence marks the “beginning of a new era in our country,” the Ethiopian Communications Authority said on Twitter last month.

It further noted that the Ethiopian government is committed to a quality communication service to citizens and businesses

What does this mean for Safaricom PLC?

The move would offer the telco a path to roll out M-Pesa in the second most populous country in the continent.

While Prime Minister Abiy’s government is preparing to sell a 45 per cent stake in state-run mobile operator, Ethio Telecom, the operator launched a mobile phone-based financial service in May, a field the PM noted will be opened up to foreign companies competition after an year.

Foreign operators are currently barred by law from participating.

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