China Telecom Global has established China Telecom (Africa and Middle East) as the regional headquarters in the African and Middle East region. CTG’s network capabilities currently cover the UAE, South Africa, Kenya, Egypt and Nigeria. The company plans to continue its network expansion across the region. In March 2015, CTG sealed the deal with Wananchi Group, East Africa’s leading telecom operator, for the National Optical Communication Infrastructure in Malawi, which spans a 428 km-wide area. China Telecom (Africa and Middle East) will oversee all the market development, network construction, business development and management of subsidiaries in the region, as well as assist multinational corporations—in particular Chinese corporations—to grow their presence in the area.

Tarifica’s Take

China Telecom, having won the Wananchi contract, is now leveraging that achievement to try and make itself a major player in the African and Middle East region generally. Many areas in this region—East Africa in particular—are open fields for a foreign operator like China Telecom, since they currently have notably underdeveloped mobile network infrastructure. Added to this revenue opportunity is the fact that the significant presence of Chinese companies doing business in the African and Middle East region constitutes a ready-made market for China Telecom’s services, which will be attractive not only because of offering high-quality connectivity in the overseas countries but also, presumably, offering seamless integration with services the companies would use in China. “It is a significant milestone for this China-based global company to reinforce its business expansion in the region,” China Telecom Group said in a statement. That expansion may be especially strategic in light of the fact that while China Telecom is the number-one operator in China in the declining fixed line sector, it is ranked third in the growing mobile market.