The French company says it would rather invest in an incumbent operator than make a bid for the fourth mobile phone licence, which the Algerian government is expected to auction later this year.

Anne Bourverot,vice-president for international business development at France Telecom, says the licence is “probably not the most viable” way of entering the Algerian market.

One potential partner is Djezzy, which is owned by Egypt's Orascom Telecom and is the largest Algerian operator with 13.8 million customers.

France Telecom already has links with Orascom Telecom in Egypt where it owns 36.5 per cent of Orascom’s Mobinil.

However, Bourverot says France Telecom will also consider forming partnerships with state-owned Algerie Telecom and Nedjma, a subsidiary of Qatar’s Qtel.