> By Matthew Tostevin
> ABUJA, June 24 (Reuters) - Nigerian President Olusegun Obasanjo said on
> Thursday he was ready to privatise telecommunications and allow a majority
> holding for private investors.
> Although no time scale was mentioned, it was the strongest indication since
> he took office last month of Obasanjo's willingness to pursue privatisation,
> which international financial organisations, creditors and business demand.
> "In pursuance of his often stated policy objective of providing cost
> effective and efficient services...the government expressed its readiness to
> pursue privatisation in the communication industry," a statement from the
> presidency said.
> Obasanjo has revealed little of the economic strategy he intends to pursue
> since he was sworn in on May 29 to end 15 years of crippling military rule in
> the oil-producing West African country of at least 108 million people.
> Some close aides favour maintaining a strong role for the state in the
> economy, and feel that Nigeria's hopelessly inefficient state firms could be
> revived if corrupt and incompetent managers were cleared out.
> Many of the enterprises in question were established or entrenched during
> Obasanjo's spell as a military ruler in the 1970s, before he stepped down for an
> elected president.
> But privatisation was a key element of an International Monetary Fund staff
> monitored programme agreed in January with the former regime, and the terms of
> any deal Obasanjo might do with the IMF are likely to be similar.
> Few believe Nigeria will get the debt relief and concessionary financing it
> seeks at a time of desperate economic difficulties if it does not make moves
> towards liberalising the economy.
> The presidency statement said foreign investors would be encouraged to
> improve state-run Nigerian Telecommunications (Nitel) and state mobile phone
> network M-Tel with both technical and financial help.
> "The President also expressed government's willingness to accommodate
> majority shareholding by those investors in the ownership of companies if such
> concession will facilitate the privatisation process," the statement said.
> Several private telephone companies already operate wireless service fixed
> and mobile services in Nigeria, but none has been granted a licence which would
> allow it to effectively compete with state firms.
> Installing a telephone line in the commercial capital Lagos is normally
> expected to cost 150,000 naira ($1,500) including official and unofficial fees
> and can take several months and cumbersome paperwork.
> Lines are sometimes cut off for no apparent reason and restoring them
> involves costly delays for business.
> Of total switching capacity of 600,000 lines, independent estimates put the
> actual number of lines in use at little more than half.
> ((Lagos newsroom +234 1 2630317))
> ($1=101.00 Nigerian Naira)
> Thursday, 24 June 1999 19:43:26