UPDATE ON PALESTINIAN MOBILE TELECOM TENDER - GOI

C O N F I D E N T I A L JERUSALEM 001453 SIPDIS SIPDIS NEA FOR FRONT OFFICE; NEA/IPA FOR WILLIAMS/SHAMPAINE/BELGRADE; NSC FOR ABRAMS/WATERS; TREASURY FOR SZUBIN/LOEFFLER/NUGENT/HIRSON E.O. 12958: DECL: 05/10/2017 TAGS: ECPS EFIN PGOV PREL KWBG IS SUBJECT: UPDATE ON PALESTINIAN MOBILE TELECOM TENDER - GOI FREQUENCY ALLOCATION WOULD BRING USD 355 M TO PA TREASURY REF: JERUSALEM 504 Classified By: Consul General Jake Walles, Reasons 1.4 (b) and (d). ¶1. (C) Gulf-owned mobile provider Wataniya Telecom, which won the second mobile telecom operator license in the West Bank/Gaza on September 18, 2006, continues to wait for a frequency to be allocated by the GOI (see reftel) before it can commence operations, according to PLO Negotiations Support Unit Policy Advisor Enas Abu Laben on July 11. ¶2. (C) When the license was first awarded, a Hamas-led Palestinian Authority government was in place which served as a significant reason for the GOI not to issue the requested frequency. Per the terms of the winning bid, Wataniya will owe the PA Treasury USD 355 million upon frequency allocation. (Note: Allegedly, Wataniya offered to pay such high licensing fees (the next highest bidder only offered around USD 25 million) because it planned to route Gulf calls through the West Bank on to points west. End note.) ¶3. (C) Comment: Allocation of the necessary frequency by the GOI and the resulting payment by Wataniya of licensing fees to the PA Treasury (now controlled by Prime Minister Fayyad) would provide a significant revenue boost to Fayyad's government, create technical and service jobs, and end the de facto mobile telecom monopoly currently enjoyed by Paltel-owned Jawwal. End comment. WALLES