FORMER TELECOM MINISTER TO HEAD TUNISIE TELECOM

C O N F I D E N T I A L TUNIS 000696 SENSITIVE SIPDIS STATE FOR EEB/CIP/BA (ALAN GIBBS) AND NEA/MAG STATE PASS USTR (BURKHEAD) USDOC FOR ITA/MAC/ONE (NATHAN MASON),ADVOCACY CTR (REITZE),AND CLDP (TEJTEL AND MCMANUS) CASABLANCA FOR FCS (ORTIZ) CAIRO FOR FINANCIAL ATTACHE (SEVERENS) LONDON AND PARIS FOR NEA WATCHER E.O. 12958: DECL: 06/26/2018 TAGS: ECPS EINT ECON TS SUBJECT: FORMER TELECOM MINISTER TO HEAD TUNISIE TELECOM REF: 07 TUNIS 119 Classified By: Ambassador Robert F. Godec for Reasons 1.4 (b) and (d). ¶1. (SBU) On June 24, the board of directors of majority state-owned Tunisie Telecom (TT) named former Minister of Communications Technologies Montasser Ouaili CEO. Ouaili leaves his current posting as Ambassador to Italy after only nine months. Ouaili will replace current CEO Ahmed Mahjoub, who has held the position from 1997 - 2001 and then again from 2002 to present. According to newspaper reports, Ahmed Mahjoub will remain at TT as the number two. ¶2. (SBU) Tunisie Telecom is Tunisia's sole fixed line provider and one of two mobile service providers (the other being private Tunisiana). Due its monopoly on fixed line service, all broadband internet connections are also reliant on TT for bandwidth. TT remains majority state-owned, but in 2006 a 35 percent share of the company was purchased by Emirati Dubai Investment Group for a price of US $2.5 billion. Tunisie Telecom has long been panned by both Tunisian and foreign investors for its sub par service. Although hopes were high that the privatization would bring needed improvements in service, there has been little tangible progress in this regard. There have long been rumors that an additional 16 percent of TT will be privatized imminently, but this has not yet been announced. ¶3. (C) Ouaili's appointment follows the May departure of Deputy Director General Francois Lucas, who was brought in by Dubai Investment Group and remained in the position for a year and a half. Lucas' departure is one in a series, with the company experiencing a virtual revolving door of high-level managers. Ahmed Mahjoub is rumored to be a difficult personality and also resistant to change. ¶4. (C) Comment: Ouaili's appointment to beleaguered Tunisie Telecom is a positive sign that change may be on the way. Although nearly 50, Ouaili is among the new generation of GOT leaders and is very forward leaning. Ouaili is also US-friendly, having received a PhD in Computer Science from the University of California at Los Angeles. During a January 2007 meeting with the Ambassador (reftel),then Minister Ouaili voiced his strong support for introducing greater competition in the telecom sector, as well as full privatization. With Ouaili at the helm, we hope that Tunisia's telecommunications services and infrastructure will finally be brought into the 21st century. ¶5. (C) Comment (cont'd): Ouaili's move from his current position as Ambassador to Italy may also presage a rumored Cabinet reshuffle. New ministerial appointments, accompanied by changes in Ambassadorships and governorships, have often occurred in late July or during the month of August. There has been speculation that changes may be announced in July in time for the RCD Party Congress. End Comment. Please visit Embassy Tunis' Classified Website at: http://www.state.sgov.gov/p/nea/tunis/index.c fm GODEC