Turkey sits on nest egg
Turkey's Telecommunications Board will wait until conditions improve before selling off the nations's potentially lucrative 3G licenses, says Mehmet Faih Yudal, head of the Board. The sale is not expected to take place until 2002.
Turkey’s ongoing efforts to get its economy back on track will include the potentially lucrative sale of its third generation mobile phone licences late next year, according to the country’s Telecommunications Board.
“Turkey absolutely must issue UMTS licences,” said Mehmet Faih Yurdal, head of the Board. “Our work on UMTS is continuing.”
However, with the current state of the global telecom industry, Yurdal is determined to wait for the right market conditions before the sale to ensure the best possible outcome for Turkey.
“There is a global crisis in the telecom sector,” he told Reuters. “It’s necessary to get the timing just right. We are talking with international institutions and, in my opinion, in the second half of 2002 or right at the end of the year it would be good to do it. We are watching world markets.”
He refused to confirm how many licenses would be issued, saying that it would depend on the level of interest shown.
“How many operators there will be will depend on the market itself,” he said. “In my opinion it could be parallel to GSM, there could be four.”
The windfall from the sale could help ease the financial crisis currently gripping the nation. The International Monetary Fund has already bailed out the country to the tune of $15.7 billion in loans, a condition of which was the privatisation of Turk Telekom.
The sale has been repeatedly delayed over the last year, through a combination of political bickering, a lack of international interest, and poor market conditions.
The landline monopoly hasn’t been doing itself any favours as far as making itself attractive to outside bidders goes, according to Yurdal. He believes that the company needs to update its technology and modernise its outlook, abandoning old traditions that hold the company back.
“Turk Telekom needs to pull itself together,” he said. “It needs to make a lot of progress, it needs to bring in a strategic partner, a lot of things need to be put in order.
“If the conditions are not right for Turkey to do this, as the Treasury says it needs to give serious and particular consideration to a strategic partner. Turk Telekom needs to prepare itself intensively for the liberalised market.”
He went on to say that, if privatised immediately, the price paid would be relatively low due to the global slump, and that the best time to privatise would be in 2002 or 2003.