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Ethio telecom awarded the majority of the expansion project that was previously in the hands of China’s ZTE to Sweden’s Ericsson. They are tasked with finishing the project in six months. The state monopoly that awarded the USD 1.6 billion multivendor financing expansion project to the two Chinese companies, Huawei Technologies and ZTE, about a year ago has been negotiating with Ericsson to award the expansion project that was previously given to ZTE.
Even though ZTE agreed to undertake the expansion project, after a long negotiation before it signed the agreement in August 2013, it never started the project. Ethio telecom officials mentioned that the Chinese company wanted to change the agreements in the contract.
One of those changes was to lift the swap and build part of the project that is a mandatory to replace the previous facilities.
Due to its delay the state monopoly was looking for other interested international telecom firms to be part of the vendor financing and for the past four and a half months the state telecom was negotiating with Ericsson, that pioneered mobile projects in the country, to carry out four circles from the total of six circles that were awarded to ZTE.
Debretsion Gebremichael (PhD), Deputy Prime Minister for Economic Cluster and Minister of Communication and Information Technology, told the media that the telecom enterprise has approached Ericsson and Nokia to finish the job.
Finally Ericsson was willing to abide by the government’s target and agreed to take the four circles that include the south, south west, south east and south-south circles of the country.
He said that the remaining two circles (west and central west) will be carried out by ZTE, who agreed to work on the project again based on the old deal.
“We wanted Ericsson to do the entire job but they couldn’t finish all six circles on time,” Debretsion said.
The Deputy Prime Minister said that all expansion projects should be accomplished by the end of the current budget year that will end early July 2015.
Currently, Huawei that secured the seven circles from the total 13 including Addis Ababa has already commenced the expansion project as per the schedule.
It has accomplished the Addis Ababa expansion and swap. The capital city project includes the newly introduced 4G technology, while the rest of the country will be connected with 3G.
According to Andualem Admassie, CEO of ethio telecom, the expansion project will cover 85 percent of the country and the number of mobile subscriptions will increase to 60 million from the current 30 million.
“We will be one of the top three countries in the continent in terms of mobile subscriptions,” Debretsion added.
The officials said that the total amount of the project awarded to Ericsson is early to estimate.
“ZTE is our strategic partner due to that we will not consider asking compensation for their delay,” Andualem told Capital.