The Ethiopian government has decided to privatize some major state corporations as part of its plan to open up the country’s economy. State-owned telecommunication firm Ethio Telecom will be the first of four major state corporations to be sold to private investors.
The move to sell some major state-owned corporations was first announced by the ruling Ethiopian People’s Revolutionary Democratic Force (EPRDF) last year. Ethiopian authorities are looking to increase foreign direct investment and spur economic growth in the country. Domestic investors will also have the opportunity to buy into state-owned companies.
The government said in a statement that it would only agree to a partial privatization agreement with investors.
“While majority stakes will be held by the state, shares in Ethio Telecom, Ethiopian Airlines, Ethiopian Power, and, the Maritime Transport and Logistics Corporation will be sold to both domestic and foreign investors,” an EPRDF press release said.
This week Haji Ebsa, the communications director of the Ministry of Finance, said the priority is on partial privatization of Ethio Telecom.
Several government committees are working to ensure that the privatization deals go smoothly. The Ministry of Finance has formed technical and steering groups that will work with a smaller group from the office of Prime Minister.
Besides telecommunication, the other industries that will be affected by the privatizations drive are aviation and banking. Ethiopian Airlines, one of the biggest airliners in Africa, is on the list of state-owned corporations to be privatized. Ethiopian Shipping and Logistics Services Enterprise and Ethiopian Electric Power would also be privatized.