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Identifier
Created
Classification
Origin
05ABUDHABI2067
2005-05-09 13:03:00
CONFIDENTIAL
Embassy Abu Dhabi
Cable title:  

UAE OPENS TELECOM SECTOR FOR COMPETITION

Tags:   ECPS  EINT  ETRD  EFIN  PGOV  KPRV  TC 
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						C O N F I D E N T I A L ABU DHABI 002067 

SIPDIS

STATE PASS USTR FOR DBELL

E.O. 12958: DECL: 05/09/2015
TAGS: ECPS EINT ETRD EFIN PGOV KPRV TC
SUBJECT: UAE OPENS TELECOM SECTOR FOR COMPETITION

REF: DUBAI 1520

Classified By: (U) Ambassador Michele J. Sison for reasons 1.4 (b) and
(d).

C O N F I D E N T I A L ABU DHABI 002067

SIPDIS

STATE PASS USTR FOR DBELL

E.O. 12958: DECL: 05/09/2015
TAGS: ECPS EINT ETRD EFIN PGOV KPRV TC
SUBJECT: UAE OPENS TELECOM SECTOR FOR COMPETITION

REF: DUBAI 1520

Classified By: (U) Ambassador Michele J. Sison for reasons 1.4 (b) and
(d).


1. (U) The UAE Telecommunications Regulatory Authority (TRA)
announced this week it has approved the establishment of a
new telecommunications company that will compete with
Etisalat, which up until now was the sole telecommunications
entity in the UAE. According to a May 7 Gulf News report,
TRA granted a $1.1 billion license to an unspecified telecom
provider. Hasan Al Kilany, senior legal counselor for TRA,
told Econoff on May 10 that 40 percent of the company will be
government owned, through the General Pensions and Social
Security Authority. He said that the remaining 60 percent
will be divided between public shareholders and private
entities, and the company may hold a public offering on the
UAE stock market for some of the shares.


2. (U) Dr. Mohamed Khalfan Bin Khirbash, Minister of State
for Financial and Industrial Affairs, was quoted in the Gulf
News article as saying that, "The UAE Government's objective
in forming this company is to offer another option for telcom
users and customers, as the company is licensed to provide
all telecom services...The initiative constitutes the first
step in the liberalization of the sector." Officials within
the UAEG had previously indicated their intention to
deregulate the telecommunications sector, making this
announcement a widely anticipated move.


3. (SBU) As reported reftel, Dubai IT managers and Dubai
government officials had told us they expected that the
second UAE-wide licensed telecommunications company would be
TECOM. TECOM, the parent company of Dubai Internet City and
Media City, has its own telecom operations inside of Dubai's
free zones, which are exempt from the Etisalat monopoly.
Talking to PolEconoff on May 9, Farid Faraidooni, Deputy
General Manager of TECOM, said that the TRA press release had
taken him by surprise. According to Faraidooni, the new
telecommunications company referred to by TRA was not TECOM,
but apparently a new company to be based in Abu Dhabi.
Faraidooni was unsure about this new company, but felt that
TRA would be coming out with some "clarifications" over the
next week or two.


4. (C) Dubai Silicon Oasis director Dr. Eesa Al-Bastaki,
asked whether he thought TECOM would be the second company,
told CG Dubai May 8 that he doubted it very seriously, as
TECOM was "not yet ready to play a national role." When the
CG pointed out that TECOM would almost certainly be more
ready than a hypothetical, unspecified company that had not
even been formed yet, Al-Bastaki agreed, but intimated wryly
that perhaps that was the point (i.e. that announcing, and
then later forming, a brand new company could be seen as a
way of postponing real competition in the telecom sector.)

SISON