Lebanese government extends mobile phone contracts delaying privatization
The Lebanese government has extended the short term operating contracts of two mobile phone companies until the end of January 2004. The government offered both the LibanCell and Cellis firms $7.5 million a month each to run the networks, reported Reuters.
The extension, the latest in a series of governmental contract renewals, indicates the possibility of a delay in privatization schemes. Liberalization of the telecom sector was one of the prerequisites set by international donors pledging four billion dollars to help reduce public debt.
The Paris II meeting, held this past November, was called only after the Lebanese government, headed by Prime Minister Rafik Hariri, assured the international community that it would implement the long-delayed privatization of state enterprises — specifically cellular phone, tobacco and energy.
In July 2002, the Lebanese government decided to put the country’s two cellular networks up for sale through an international public tender. Contracts with Cellis and LibanCell were revoked in mid-2001, although their 10-year Build-Operate-Transfer (BOT) contracts were to expire only in 2004.
Lebanese parliament passed a new telecom law last year that allowed the sale of a portion of the state’s stake in the sector. The new legislation was meant to be enacted by Parliament before the year’s end.
The new law would have lead to the introduction of a new telecom operator called Liban Telecom. Initially state-owned, Liban Telecom would eventually be bought by a strategic investor and shares would be offered to the public. The firm would run Lebanon’s fixed line network and eventually operate a mobile network. — (menareport.com)
© 2003 Mena Report (www.menareport.com)