Ethiopia is embarking on the path of inclusive digital transformation as it is registering a significant achievement in recent years complemented by the macro-economic reform that centered at the liberalization of government owned sectors. Ethio-telecom is among the sectors long controlled by the government, in which, its liberalization was a game changer in driving nation’s path towards digital transformation.
Following the reform process introduced over the past years,Ethiopia has been successful in mobilizing FDI flows compared to other countries in sub-Saharan Africa. Nevertheless, it could attract more investment through championing digital transformation in the industrial sector and ensuring that the manufacturing sector has access to a greater availability of digital technologies and associated skills.
Recently, Global System for Mobile Communications Association (GSMA), in collaboration with Ethio-telecom, has launched a report on Ethiopia’s digital transformation titled “Driving Digital Transformation Economy in Ethiopia” in telecom stakeholder. The report highlights ethio-telecoms role in driving the nation’s economy, attributing the progress to government’s digitization drive, reforms in telecom sector, and mobile technologies.
GSMA’s report has projected that Ethiopia’s digital economy would contribute 1.3 trillion Birr to the country’s GDP by the year 2028, highlighting the sector’s bold role in driving economy.
Ethiopia’s mobile money services have played a pivotal role in financial inclusion, with over 90 million registered accounts in June and a penetration rate of 70 percent, the report found out, and added, this has contributed to the financial inclusion of more than 50% of the Ethiopian population.
According to the report, mobile connections have been a significant driver of Ethiopia’s economic growth, contributing 10% to GDP over the past five years. This makes Ethiopia the second-highest country in Africa in terms of mobile contribution to GDP, after Nigeria. Furthermore, the digital economy is expected to create over 1 million new jobs and generate an additional 57 billion Birr in tax revenues by 2028, it has projected.
Noting that digital technologies are catalyzing growth in key sectors such as agriculture and manufacturing, the report stated that agriculture is projected to generate 140 billion Birr, while manufacturing is expected to contribute 114 billion Birr by 2028. Despite the significant progress, a substantial usage gap persists, with 76% of the population still not using mobile internet. Bridging this gap, particularly the 40% gender disparity in mobile internet use, is crucial for Ethiopia’s digital future.
Innovation and Technology State Minister Yeshurun Alemayehu said that Ethiopia’s telecom liberalization is evident how government-private partnership drives cross-sector growth. Ethiopia has made significant strides in digital transformation and the government is also committed to create conducive environment for innovation and entrepreneurship.Ethiopia has made significant strides in embracing digital transformation as a core component of its national development strategy and recognizes that technology is a key enabler of growth.
The liberalization of telecom sector has opened door to new investments, increased competition and enhanced service delivery and similar partnership and different modalities in other sectors like in health, agriculture and education will further accelerate the nation’s digital transformation.
Ethio-telecom CEO Frehiwot Tamiru said the company is working closely with domestic and global organizations to ensure accessibility of telecom services across the country. The number of mobile users was 37 million in 2018 and has now reached 79 million, while the number of internet users has increased from 16 million to 46 million, she said.
Safaricom Ethiopia CEO Wim Vanhellepute said that similar to ethio-telecom, the sector is significantly contributing to digital transformation of the country and the company is applying similar strategy in Ethiopia to pursue the nation’s digital move. Entered Ethiopian market two years ago,Safaricom has managed to onboard close to 6 million users.
By leveraging mobile technologies, the country can boost productivity in various sectors, create new opportunities, and improve the lives of its citizens. Ethio-telecom and Safaricom Ethiopia have been instrumental in driving this growth through expanded mobile internet access and increased competition in the telecom market.
BY HAILE DEMEKE
The Ethiopian Herald November 3/2024
