Yechalal! ...... Awoooooooo .....Yechalal! - Amxambe

As an IT guy two things take my attention, Telecom and Banking system. I don't understand the banking system of Ethiopia why it's not liberalized and monopoly of Telecom also... 

Ethiopian Telecommunication’s monopoly enables it to charge $35 for a mobile-phone SIM card, which is required to obtain a mobile-phone number. In neighboring Somalia and Kenya, which have private mobile services, cards cost less than $5.

A 1-megabyte per second Internet connection costs more than $2,000 a month in Ethiopia. In South Africa, the continent’s biggest economy, a similar service costs between 600 rand ($59) and 760 rand, according to the http://www.mybroadband.co.za Web site.

“In Ethiopia, if there is any problem I don’t think it’s the price,” said Birru. “It’s the quality of the service. This has to be improved. And to improve this I don’t think it would be wise to privatize it.”

Ethiopia’s government is reluctant to sell the company because it is profitable and is expanding services to rural areas, Newai Gebre-Ab, Prime MinisterMeles Zenawi’s top economic adviser, said yesterday in an interview.

Cash Generator

The company is “generating a lot of money and that money is being put to good use for development of infrastructure,” Gebre- Ab said.

Birru also said the Ethiopian central bank lacks the capacity to regulate large foreign financial institutions. The country is also unsure whether foreign banks would play a positive economic role in the country. As a result, the country is unlikely to liberalize the financial-services industry.

“At this stage, given the capacity that we have in terms of managing things and supervising them at the National Bank level, I don’t see why we’d allow that,” he said.

Ethiopia’s three state-run retail banks control about two- thirds of the capital in the country’s banking industry, according to the National Bank of Ethiopia. Until last year, no bank in Ethiopia could process MasterCard transactions. Banks in the country are also reluctant to lend to businesses that cannot provide real estate as collateral.

Three private banks in Ethiopia- Awash International Bank S.C., Nib International Bank S.C and United Bank S.C. - on Thursday signed a memorandum of understanding which would enable them to launch a wide-reaching ATM machine and point of sales (POS) terminals network through which customers can withdraw cash and make payments for purchases.
The agreement is said to be the first significant cooperation between competing banks in Ethiopia. Three banks have agreed in principle to establish a ATM network called Fettan. The Ethiopian based IT company, Offshoring 2.0 Technology Services PLC, is under consideration to operate and manage the Fettan ATM network.

The Fettan ATM consortium, to be formed, will develop detailed business proposals to be discussed with each bank’s board prior to final decisions on investments and service implementation. According to Berhanu Getaneh, president of United Bank, it took the banks three months to reach this agreement. “It is like a marriage. It is really a long process,” Berhanu told reporters.

If everything goes as planned, Fettan ATM will install over 140 ATM machines and over 340 POSs across Ethiopia. There will be one ATM at every branch of the consortium banks, all domestic airports serviced by commercial service, shopping complexes and merchants. The total investment is estimated at 40 million birr.

Amerga Kassa, president and board member of Nib Bank, comments, “There is no single bank in Ethiopia that can afford to provide extensive geographical coverage and access, or create the know-how to do this properly, as a result this will lead to slow acceptance of card payment system by consumers and it makes total business sense to unite.”

The banks said that other banks and micro-finance institutions are well come to join the consortium.