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Ethiopia to split state telecoms provider into two before privatisation

Ethiopia will split its state telecoms provider into two businesses before it is privatised, state-affiliated media reported on Monday, a key part of government's plan to open up one of the world's last major closed telecoms markets.

By Maggie Fick

NAIROBI, June 17 (Reuters) - Ethiopia will split its state telecoms provider into two businesses before it is privatised, state-affiliated media reported on Monday, a key part of government's plan to open up one of the world's last major closed telecoms markets.

The government will split Ethio Telecom into two business units along infrastructure and service sector lines, state-affiliated Fana Broadcasting quoted Minister of Finance Ahmed Shide as saying.

State Minister of Finance Eyob Tekalign Tolina confirmed the report.

Ethiopia could require as much as $2.2 billion to modernise its creaking, overburdened telecoms sector, Eyob told Reuters last week.

Privatisation is one of the key reforms promised by Prime Minister Abiy Ahmed. He wants to encourage competition and foreign investment after decades of state-driven economic growth.

Ethiopia passed a bill on Thursday outlining the scope of a regulator for the telecoms sector, a key milestone towards attracting outside investment in the nation of 100 million people.

(Additional reporting by George Obulutsa; writing by Katharine Houreld, editing by Deepa Babington)

((katharine.houreld@thomsonreuters.com; + 254 796 142 176;))

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