x Abu Dhabi, UAESunday 23 July 2017

Lebanon to open up telecoms sector

The privatisation of Lebanon's telecommunications sector is no longer an option, according to the country's telecommunications minister.

A woman speaks on a mobile phone in Beirut. Lebanon is looking at a new telecoms model. Joseph Barrak / AFP
A woman speaks on a mobile phone in Beirut. Lebanon is looking at a new telecoms model. Joseph Barrak / AFP

The privatisation of Lebanon's telecommunications sector is no longer an option, according to the country's telecoms minister.

"The world is moving away from vertical integration and the system that was fashionable for the last 20 years of monopolies whether they were private or public. The new trend in the world is to delayer the telecoms sector. It is a vision that we are presenting to the council of ministers," Nicolas Sehnaoui, the Lebanese telecoms minister, said in an interview with The National.

The ministry, along with the country's telecommunications regulations authority (TRA) has drafted a new structure model that simplifies the sector to rid the government's current heavy presence in the mobile sector.

This model includes an infrastructure layer and middle layer with three to five private operators providing services and capacity to the private-sector operators in the retail sector.

"The infrastructure will be in a commercial structure but owned by the government with maybe 3 per cent floated on the market," said Mr Sehnaoui.

He has already presented the case to Michel Suleiman, the president, and Najib Azmi Mikati, the prime minister, who is expected to forward it to the council of ministers in the next few weeks.

"It will take at least until the end of 2013 to start being implemented. It will take another two to three years to be operational," said Mr Sehnaoui.

Last year, the country's two state-owned operators posted revenues of about US$1.6 billion (Dh5.87bn), of which $1.4bn went directly to the government.

The earnings of Alfa Telecom and Touch, which are operated by Egypt's Orascom Telecom and Kuwait's Zain Group under management licences, contribute about 40 per cent to the national income. With a debt of $60bn, the country has been reluctant to open up the telecoms sector and risk damaging a guaranteed revenue stream.

This new model, however, aims to double the revenue of the telecoms sector by 2016.

This year, the ministry has invested $200 million in the telecoms sector with similar amounts set for next year. Both operators are launching long-term evolution, or LTE, services using super-speed mobile broadband, in April.

"We had some problems for years but now we're catching up," said Mr Sehnaoui.

"The latest ITU [International Telecommunication Union] report says we are one of the 10 countries who were most advancing in 2011."

 

thamid@thenational.ae