Jordan Telecom eyes Iraqi mobile license

The Jordanian PTT is amongst several Arab companies that want to bid for a mobile license in Iraq, but may be prevented from doing so by Coalition Authority rules.

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By  David Ingham Published  August 10, 2003

Laurent Mialet, the new CEO of Jordan Telecom Company (JTC), says that the operator will definitely bid for an Iraqi mobile license if it is allowed to. At the moment, a ruling by Iraq’s Coalition Provisional Authority prevents companies in which a government holds more than 10% from bidding for the licences.

“It is an issue for us and we are waiting for solutions, so I cannot tell you if we will bid,” Mialet told ITP.net. “If we are able to, we will. If we are forbidden, we won’t.”

According to the Coalition Provisional Authority (CPA), the ruling intends to prevent foreign governments from having too much control over a vital part of Iraq’s infrastructure. It also means, however, that few of the region’s telcos can bid for the licenses, which has prompted accusations that the move is designed to favour US bidders.

In Jordan Telecom’s case, the country’s government owns 45% of its shares, although it would sell them at the drop of a hat if there were any takers. France Telecom, 55% owned by the French government, holds a further 32% of Jordan Telecom and has management control of the company.

Asked if the decision will be reversed or the government ownership threshold increased, Mialet replied: “It will be improved.”

Even if it can get round the ownership rules, there’s also the French Connection to bear in mind. Does Mialet think the company’s Frenchness (he was seconded from France Telecom) will be a problem?

“Ask the Americans,” he replies. “What I can tell you is that the telecomms network in Jordan is considered a model in the region. That could be more important than the fact that the French have 32% of the shares. Here, we’re ten expatriates and the supplier is Ericsson, so it’s not very French.”

At the moment, it remains to be seen if the US will modify the rules so that Arab companies can bid for the licences. Observers in the region certainly hope so.

“This would ban many companies, some of which are highly recognised and respected,” says Abed Al-Rahman Pharaon, research analyst, Arab Advisors Group. “I think that the CPA should reconsider the rule, as what is going on might lead to some form of American monopoly in Iraq.

Fawaz Zu’bi, Information and Communications Minister of staunch US ally Jordan, also called for the CPA to change the rule. “Stringent conditions should be relaxed,” he said. “The Arab world’s operators’ knowledge and experience of the market will be essential.”

The CPA is inviting bids for three mobile licenses, each of which covers a specific region of Iraq. Companies have until August 21 to submit bids.

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