Mobile privatisation delayed

3 Feb 2004

The Lebanese government on Saturday voted to postpone the planned privatisation of the country’s mobile sector after failing to attract suitable bids in auction. In June 2001 the government cancelled the licences under which the country’s two cellcos, LibanCell and Cellis, had provided services under since 1994. The two companies have since operated on temporary licences whilst the Higher Council for Privatisation (HCP) attempted to re-award new twenty-year concessions via public tender. The HCP stipulated that any company interested in bidding must have a minimum experience of five years in GSM networks and must also have a minimum of 350,000 subscribers. In May 2003 seven companies, including France Télécom and Greece’s OTE, were pre-qualified to bid for licences, but when the deadline closed at the start of this year only LibanCell and Cellis-affiliate Investcom had made concrete bids. The lack of outside interest has prompted the government to begin the whole auction process once more, this time handing control of the tender to the Telecommunications Ministry, rather than the HCP. Privatising the telecoms sector has been a key part of a long standing government plan to raise funds to help reduce the country’s USD32 billion public debt. The failure in opening up the mobile market has raised concern over other panned privatisation projects, including the fixed line telecoms sector.