"It only remains to launch the operation in 90 days," Transport and Communication Minister Vicente Blute told AFP. The work will be carried out by the Huawei group.

"China has come to replace Portugal and it is all working wonderfully," said Blute, adding that the terms of reference allowing it to start its activities were ready.

The telephone networks have up till now been jointly managed by Portugal Telecom (51 percent) and the government of Guinea Bissau (49 percent) but have been at the centre of a dispute between the two parties for some months, the minister said.

Guinea Bissau wanted its agreement with Portugal amended to give it a more favourable deal. Portugal Telecom, having failed to get the government to change its mind, has pulled out.

Huawei has also undertaken to improve the Internet network with top of the range broadband equipment, the minister said.

As part of the agreement China is also to train and supervise local technical staff by offering scholarships.

Three companies -- Orange, Areeba and Guinetel -- serve the country's 60,000 mobile phone subscribers.

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