- New report highlights positive impact of liberalisation of mobile market in Africa’s second largest country
A new report published today by British International Investment has revealed that a UK-backed mobile network operator has helped millions of Ethiopians to access superfast 4G mobile internet across the country.
Safaricom Ethiopia, which was founded with investment from a consortium that comprised of BII, IFC, Safaricom, Sumitomo Corporation, Vodacom and Vodafone Group, was awarded Ethiopia’s first mobile network licence to be granted to a private company in 2021.
BII and Safaricom Ethiopia commissioned the report, entitled ‘Impact of investment in the Ethiopian telecoms market – the story so far’ – to take stock of how the Ethiopian telecoms market has changed and evolved since the liberalisation process of the sector began in 2019.
Since the launch of Safaricom Ethiopia in 2022, the cost of mobile data services in the country has fallen by up to 70 per cent. As of 30 June 2024, Safaricom Ethiopia had signed up 4.4 million customers. Safaricom has built nearly 3,000 2G, 3G and 4G network towers covering 44 per cent of the population. The telco has doubled the availability of 4G services in the country.
The report, by Analysys Mason, identifies the impact that competition from Safaricom’s entry in Ethiopia has had, and is expected to have, on the telecoms sector, society and the economy. The report:
- reveals that investments in digital infrastructure and services have resulted in price reductions for mobile and data packages, and improved services for millions of Ethiopians;
- highlights the potential socioeconomic benefits resulting from improved digital connectivity based on case studies from other comparable African markets; and
- illustrates the benefits of 81 per cent of the Ethiopian households now having access to a mobile phone.
In a visit to Ethiopia, Lord Collins, the UK Minister for Africa, said: “Safaricom Ethiopia is a company that has given millions of Ethiopians access to vital, and affordable, digital services.”
“Investment from BII, working in partnership with other development finance institutions, private investors and Vodafone, a giant of British business, has had a positive influence on the Ethiopian mobile industry.”
Abhinav Sinha, Managing Director and Head of Technology at BII, said: “Safaricom Ethiopia is putting the internet in the hands of millions of people, reducing prices and improving services. Mobile competition in Ethiopia is already delivering impact at a country level, and the report highlights the future opportunities to benefit society and the economy.”
In particular, the report cites Ethiopia’s mobile money market as a key driver of economic opportunity. Safaricom’s M–PESA provides financial services to millions of people who have a mobile phone but no bank account, or only limited access to banking services. It was launched in Ethiopia in August 2023 and over 5.8 million customers have registered for the service. It has been instrumental in improving financial inclusion in Kenya and is expected to do the same for Ethiopia.
Other services such as digital health, education and agriculture will be needed to unlock specific socioeconomic benefits. Safaricom Ethiopia is starting to play a crucial role in supporting the success of these services beyond just supplying necessary connectivity.
The full report is available here.
