• Sat
  • Jul 12, 2014
  • Updated: 5:07am
NewsAsia
MYANMAR

Foreign firms win licences to provide mobile phone networks in Myanmar

Norwegian and Qatari companies to build mobile phone networks, after auction seen as test case for economic and political change

PUBLISHED : Friday, 28 June, 2013, 12:00am
UPDATED : Friday, 28 June, 2013, 5:11am

Norway's Telenor and Qatar's Ooredoo won licences yesterday to provide telecommunications services in Myanmar, bringing foreign companies into the sector for the first time.

The bidding in Myanmar's first telecoms auction was seen as a test case for economic and political change initiated by the quasi-civilian government that came to power in 2011 after 49 years of military rule.

A statement on the Ministry of Communications' website said that if one of the two licence winners failed to meet post-selection requirements, the back-up candidate would be France's Orange in partnership with Marubeni of Japan. The winners had "committed to offer a wide range of services to the public at affordable prices in both urban and rural areas", it said.

The winners were selected from a shortlist of 11 bidders, whittled down from more than 90 companies and consortia that had expressed interest in working in a fledgling market of 60 million people, where 9 per cent at most have a mobile phone.

Telenor, which has 150 million customers worldwide and operates in neighbouring Thailand and Bangladesh, said it would launch its network next year and achieve nationwide coverage within five years.

"We have established leading mobile operations in five dynamic Asian markets and the announcement underscores the continued success of Telenor's strategy of delivering accessible and affordable mobile communications services," said Sigve Brekke, head of Telenor Asia.

The government has said it will finalise the 15-year licences by September and the chosen operators would need to launch services within nine months. They have to provide voice services across three-quarters of the country within five years and data services across half of it.

There was a last-minute hiccup when the lower house of parliament voted on Wednesday to delay the award of the two licences until a new telecommunications law was enacted. But the government body overseeing the tender said parliament had no authority to delay the process.

The telecommunications bill is still making its way through parliament, but the government statement said it was expected to be passed in the current session.

"These issues could have been raised and addressed with the government much earlier in the process," said Marae Ciantar, a lawyer with the Singapore-based firm Allens, which has advised international telecoms companies seeking to invest in Myanmar.

He added that "investors will likely commend the government for adhering to the announced timetable and process for selecting the winning bidders", but said the timing of the parliamentary motion "does give rise to concerns as to what may really have been behind the decision".

Soe Yin, a parliamentarian with the pro-government Union Solidarity and Development Party, which is made up largely of retired military officers, said the motion called for further discussion on the issue, but did not entirely reject the notion of full foreign ownership. "Some people are not happy we are giving all these tenders to the private foreign companies," he said.

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