Jan 16, 2013

Myanmar seeks partners to free up telecoms sector

Myanmar's government has taken a fresh step toward liberalizing its state-dominated telecommunications sector by publishing a notice Wednesday inviting investment proposals from local and foreign companies for nationwide telecommunications services including telephone and Internet connectivity.

An announcement in the state-run New Light of Myanmar newspaper said that two companies will be awarded licenses, and expressions of interests should be submitted no later than Jan. 25.

The move soliciting an "Expression of Interest," or EOI, comes amid a raft of political and economic reforms instituted by the elected government of President Thein Sein to jumpstart the country's development after almost five decades of repressive military rule that left Myanmar one of the poorest nations in Asia.

Telecommunications can be an extremely lucrative sector, and several foreign companies have already established offices in Myanmar since Thein Sein began to overhaul the economy as various sanctions applied by Western governments against the previous military regime were eased.

"Both local and foreign firms can submit their EOI and two companies that can fulfill the criteria to provide nationwide telecommunication service will be given licenses by June this year," Soe Naing, assistant director of the Post and Telecommunications Department told The Associated Press.

Soe Naing said there are also plans to transform the state Myanmar Posts and Telecommunications Department into an independent entity to be called Myanmar Telecoms.

The published call for EOIs said one of the principal goals of opening up the tender is to increase the country's telephone penetration to 75-80 percent in 2015-2016 and "to make the telecommunications services available to the public at affordable prices and to give the public a choice of telecommunications services."

Soe Naing said the current level of telephone penetration among Myanmar's 55 million population is about 10 percent. Installation of a landline costs about $765 and a mobile phone costs about $235.

Neighboring Thailand began breaking the state's monopoly on phone services more than two decades ago, though its much stronger middle-class made the market more attractive to investors than the underdeveloped economy in Myanmar. However, state-affiliated Thai enterprises have retained some of their privileges, complicating the growth of a truly free telecoms market.

Source: The Miami Herald