Iraq yesterday sold three mobile phone licences for a total of $3.75 billion (€2.8 billion), replacing short-term contracts awarded after the US invasion.

The 15-year licences were given to three of four incumbent operators - Kuwait's Mobile Telecommunications (MTC) and Iraq's Asiacell and Korek - for $1.25 billion each.

Telecoms has proved to be one of the pro-fitable businesses in Iraq, with eight million mobile users predicted in the country by the end of 2006, which had grown from virtually zero before the war.

Bayan Jaber, the Iraqi finance minister, said it was estimated that the licences would bring the government total revenue of about $8 billion over 15 years.

"To get the best return from the auction in such circumstances is a great vote of confidence in the Iraqi economy," he said.

Orascom Telecom, the Egyptian company that operates the Iraqna network and was the first company to set up a full mobile service in Baghdad, withdrew from the bidding, which Mr Jaber said was a surprise.

Orascom pulled out when the bids reached $1.25 billion, while Turkcell, the Turkish mobile operator, withdrew when bidding reached $800 million, he said.