Privatisation of Lebanon Telecom delayed by political instability

Lebanon Delays GSM Network Privatisation
Lebanon's government has delayed the planned privatisation of the country's two GSM network operators until the beginning of May. The sale was due to have been carried out at the end of next month - and raise upwards of US$6 billion for the government. The sale will be for two-thirds of the networks, with one third retained by the government, which will then be floated on the Beirut Stock Exchange.
"The government decided to delay the auction for few months to determine if a broader cabinet will be formed," Ziad Hayek, the president of the Higher Privatization Council, told The Daily Star newspaper.
Opponents of the privatisation claim that the sale would deprive the government of US$1 billion per year in revenues from the networks - while supporters note the high tariffs charged to customers and lack of competition in the market is holding back the overall economy.
Hayek stressed that none of the companies which shown interest in the auction pulled out.
A source close to the process told The Daily Star that most companies will be reluctant to pay billions of dollars for mobile licenses if there is no political consensus on the issue.
"Some of the companies will think twice before making any commitment in Lebanon. They naturally want guarantees that any transaction in the future will not be blocked by the opposition," the source said.
The two operators have roughly equal market shares as they are tightly regulated by the government. The Mobile World notes that the two operators have some 1.2 million customers between them, representing a population penetration level of 30%

COMMENTS BY CPI
It appears that the stakes have been raised. The proceeds from the sale of two thirds of the mobile network are now expected to reach $6 billion. This means that the entire mobile network is now estimated at $9 billion. The question is:

• Is it worthwhile to give away a revenue of $600,000,000 a year for a lump sum of $6 billion?
• Furthermore, would it not be preferable to increase the network's penetration and win over fifty per cent more customers instead of selling the network?

All these questions deserve to be studied and openly discussed with the citizens before the Administration, takes a decision one way or the other.
This has nothing to do with the Loyalists and the Opposition. It is simply a matter of transparency.