Ethio Telecom (ET) has concluded a major vendor financing telecom expansion project deal after it signed the second lot of the 1.6 billion dollar agreement with Chinese telecom firm ZTE on Sunday August 18.
The deal between ZTE Ethiopia and ET has given half the project to the Chinese firm, which previously worked on a 1.5 billion dollar telecom expansion project in Ethiopia.
Around a month ago, Chinese telecom giant Huawei Technologies signed a deal for $800 million, representing half the total project, with ET.
The expansion project aims to increase mobile phone and 3G Internet access throughout the country and introduce 4G broadband Internet in the capital, Addis Ababa.
Debretsion Gebremichael (PhD), head of Finance and Economic Cluster in the Deputy Prime Minister’s portfolio and Minister of Communication and Information Technology, said that the 4G project will be taken on by Huawei.
This project is a major element of the telecom sector of the Growth and Transformation Plan (GTP), which is due to be completed in 2015.
“The project is not only the expansion but as well as to upgrade existing network to new technology,” Andualem Demisse, acting CEO of ET said.
The minister added that while the Chinese companies undertake the project, they will use European technology.
“We will fulfill the GTP. Currently we attained half of the projection to reach 40 million mobile users by mid of 2015,” Dr. Debretsion said.
“We give propriety for Addis and other major projects to finalize before the end of the five year plan,” he added.
“In few months they will start delivery of projects in Addis based on our priority. The city is rapidly expanding so it is difficult to deliver quality service in the suburbs of the capital city, in addition with the problems that are related with the old aged Nokia technology transmission towers in the central part of the city due to that we have to expand the sector in Addis and continue to other part of the country with latest technology,” continued the minister, who is responsible for ET.
“This time we have developed very meticulous specifications with the support of France Telecom (Orange) that they have to attain on the implementation and after the implementation. So it’s up to the quality of specification and contract,” he explained about the quality and standard of the contract.
The expansion project contract would enable ET to increase mobile service capacity from the current 23 million subscribers to 50 million and provide 4G access for Addis, as well as enable 3G service across the country.
ET, the sole telecom provider in the country, has amassed 20 billion birr revenue in the past fiscal year, which is an increase of three billion birr, compared with 2011/12 fiscal year.
The revenue from the mobile sector accounts for almost 70 percent of the total revenue.