Qordahi poised to restart telecoms privatisation

11 October 2004
Telecoms Minister Jean-Louis Qordahi will kick-start the country's stalled telecoms privatisation as soon as a new cabinet is appointed, say sources in Beirut. Sources at the Telecommunications Ministry say Qordahi is planning to restart the process by seeking as early as possible cabinet approval for the establishment of the Telecoms Regulatory Authority (TRA).

Qordahi will also ask the cabinet to implement a new telecommunications law converting fixed-line operator OGERO Telecominto Liban Telecom, a state-owned company that will operate the country's fixed-line network and third GSM mobile phone network. Within two years of its creation the minister will part-privatise Liban Telecom with the sale of a 40 per cent stake in the company. The plan to establish the TRA and Liban Telecom, along with the auction in 2003 of 20-year licences to operate the country's two GSM networks, has been stalled by political disputes between President Lahoud and Prime Minister Rafiq Hariri.

Parliament voted on 10 September to amend the constitution to extend Lahoud's term in office by three years. The vote hands control of the privatisation to the Damascus-backed president. The expected resignation of the cabinet and appointment of a new government will allow the pro-Lahoud Qordahi, who is expected to remain as telecoms minister, to push ahead with the president's desired reforms.

His first move will be to appoint a director-general for the TRA, an appointment that has been delayed by the Hariri/Lahoud spat. 'All the requirements are already achieved,' says a ministry source. 'It is awaiting only the nomination of the board of directors by the Council of Ministers.' Says an international consultant: 'The establishment of the TRA is a prerequisite to international companies being interested.'

Also awaiting cabinet approval is Telecommunications Law 431, which covers the establishment and privatisation of Liban Telecom. 'A tender for the advisory mandate could be issued within two weeks of the new government being formed,' says another source close to the minister.

Installed in the 1970s, the country's fixed-line network has capacity of 1.5 million lines, though subscriber levels currently hover below 800,000. Liban Telecom will have an initial three-year monopoly and will come with a third GSM licence, a full fibre-optic backbone, the public data network, satellite facilities and government shares in other sectors, such as ArabSat.

Further down the line, the minister is expected to re-auction the two long-term licences to operate the country's existing GSM networks. The sale in 2003 was scrapped after four months because bids for the two build-operate-transfer (BOT) contracts did not meet the government's expectations. Instead, two four-year management contracts were awarded in April to Germany's Deteconand Kuwait's Mobile Telecommunications Company (MTC - MEED 16:4:04).

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