The Ethiopian government on Tuesday announced that it has launched a bidding process for private investors to buy a 40 percent stake in state-owned telecommunications service provider, Ethio Telecom.

The Ethiopian Ministry of Finance, which is leading the bidding process, released the request for proposal (RFP) for the partial privatisation.

"The Government of Ethiopia has released an RFP for the Partial Privatization of Ethio Telecom to invite proposals from interested parties who can add value to the company by bringing in best practices in operations, infrastructure management and technological capabilities," the ministry said.

The RFP is open to all interested parties and is not limited to companies that have previously submitted an expression of interest.

It also stated that any interested party must pay a non-refundable $20,000 in order to obtain the RFP and must submit a confidentiality undertaking to the Ethiopian government.

"An interested party may obtain the details of the account for payment of the RFP fees as well as the form of the confidentiality undertaking by sending a written request to [email protected] starting today" it said.

The RFP contains details and instructions in relation to the Partial Privatization, process of proposal submission and qualification criteria.

The partial privatisation of Ethio Telecom aims to make the company more efficient in providing telecom services in Africa's second most populous nation with a population of about 120 million.

The privatization process is part of the country's Indigenous Economic Reform Program.

The objective is to broaden the role of the private sector in the Ethiopian economy, improve the efficiency of public enterprises, enhance their competitiveness, increase their access to capital, and enhance the quality and accessibility of their services.

Ethio Telecom, which has some 45 million subscribers, is one of the most profitable companies in the country.

It generated an annual revenue of 56.5 billion Birr (about $1.3 billion) during its budget year concluded on June 30, 2021. The revenue grew 18.4 percent compared to the previous year, according to CEO Firehiwot Tamiru.

Ethiopia, one of the last countries in the world to privatise its telecom sector, has been trying to sell its telecom shares for three years as part of its economic reforms with the help of various international financial institutions.

In May, one of the licences was awarded to a consortium led by Kenya's Safaricom, which won by offering $850 million.

The consortium is expected to launch telecom services in Ethiopia in January.

Ethiopia’s young population, high gross domestic product growth rate, and increased private sector investment offers valuable growth opportunities.