Ethiopia’s Infrastructural Drive Continues at High-Gear

Train-Project-Addis-Ethiopia-1

By Nejib M.
August 02, 2013

Ethiopia has been working with the objective of achieving the middle-income status in about 25-30 years for the last decade. Under a committed leadership and well-crafted policies of a developmental state, a double-digit annual GDP growth has been registered since 2003 under the PASDEP and a preceding interim poverty reduction plan.

By 2010/11, the government prepared a 5-years Growth and Transformation Plan (GTP) that has started full implementation the next year. It is a grand a grand plan with the highest total budget cost ever – of which more than 60 percent allotted for of pro-poor sectors, such as agriculture, education, health care, water and road development.

The GTP, as described in the document, “is directed towards achieving the Millennium Development Goals (MDGs), Ethiopia’s long term vision and sustaining rapid, broad based and equitable economic growth anchored on the experiences that have been drawn from implementing pro-poor and pro-growth development policies and strategies undertaken since 1994″.

The GTP was met with doubt and skepticism since the beginning. However, as its implementation proceed, many international organizations and experts retreated from calling it “impossible” to saying “ambitious but attainable”.

 

Subsequently last month, the World Bank issued a report that commended Ethiopia’s development policies as well as their implementations. The report stated “over the past decade, the Ethiopian economy has been growing at twice the rate of the Africa region, averaging, 10.6 percent GDP growth per year between 2004 and 2011 compared to 5.2 percent in Sub-Saharan Africa”.

However, Ethiopia made steady progress in most areas of the GTP. Even in the 2011/12 fiscal year, when Ethiopia for the first time in nine years registered below double digits economic growth, there were major achievements in crucial areas.

The Ministry of Finance and Economic Development (MoFED), disclosed a few months ago that Ethiopia’s per capita income has reached 9,370 birr in the 2011/12 fiscal year increasing from the 5,800 birr in previous fiscal year (2010/11). Ethiopia’s GDP was about 506.6 billion birr, while the Gross National Product (GNP) reached 737 billion birr.

Subsequently last month, the World Bank issued a report that commended Ethiopia’s development policies as well as their implementations. The report stated “over the past decade, the Ethiopian economy has been growing at twice the rate of the Africa region, averaging, 10.6 percent GDP growth per year between 2004 and 2011 compared to 5.2 percent in Sub-Saharan Africa”. The report also noted that Ethiopia’s development strategy as “consistent with the development experience of some of the recently successful countries, particularly in East Asia”.

However, this doesn’t mean Ethiopia’s policies and implementations are perfect. Therefore, different think-thanks and international organizations make suggestions on how to sustain and speed-up the current economic progress. As western analysts tend to be pessimist about Africa, some of these analysis – though, they admit Ethiopia has made big stride in the past years – they underestimate her potential to replicate and scale-up the achievements in the coming years.

Such reports confuse Ethiopians and friends of Ethiopia who are not much informed about the scale of progresses made and the government’s commitment to sustain it. Thus, it is of paramount importance to provide the real picture of each sectors. One of crucial sectors is the Telecoms sector – which I will briefly review today.

The Ethiopian government had long started expanding communication infrastructure at a break-neck speed. As far back as 2005, when the role of mobile telephone for rural development was less obvious, the government had set ambitious targets. Such as; enabling every Ethiopian access telecommunication services within 5 km of her residence, increasing Tele-density for fixed line by fivefold and Tele-density for mobile by fifteen-fold.

The telecoms infrastructure expansion included providing 15,000 (almost all then existing) Kebeles with at least five telephones lines. The expansion of telephone services in the rural areas were hoped to deliver much more than faster exchange of market information for farmers. It was also with the objective of expediting public mobilization for development that the government launched major ICT projects in 2005; such as, among many, the School Net (to connect 600+ high schools); the Woreda-Net (to connect 600 Woredas) and and the HER Net (for higher education institutions).

According to the International Telecommunication Union (ITU), internet subscription grew by thousands percents since year 2000 to 2009.

Despite impressive achievements, set much bigger telecoms service expansion targets in the GTP in 2010/11. In fact, since 2011, Ethio-Telecom, with a strong backing from the Ministry of Information and Technology, was engaged in an aggressive and innovative marketing strategy to increase the number of mobile subscribers, in addition to expanding the infrastructure.

Not to forget, the improvement in the procedure for connecting one’s mobile phone to the internet which now takes a single free phone call to the Ethio Telecom.

As a result, as of June 2012, the number of mobile phone subscribers stood at 17 million (from about 5 mil. in 2011) and the number of internet service users reached 2.5 million (from 100,000 in 2011), according to the data from the relevant Ministry.

On June 2013, Ethio-Telecom announced further plans to upgrade mobile networks. The upgrade is intended to help double the mobile phone user base to 40 million.

Earlier on March, Ethio-telecom moved to upgrade the current telecommunications infrastructure to 3G LTE (long-term evolution) networks, from the current 3G network at a cost of 1.5 billion dollars.

[Note that: 3G LTE is a wireless broadband technology, designed to support roaming internet access using cell phones and hand-held devices. Its structural design is based on an Internet Protocol (IP), and unlike many other cellular IPs, LTE supports browsing and downloading at 300 megabits a second.]

Ethio-telecom did also announce plans to divide the country into 11 infrastructure zones, two months ago, in order to better manage each network in two years period. The work is aimed at doubling the existing 20 million mobile users by the 2014/15 fiscal year, and alleviating the present network problems.

In May 2012, Ethio-telecom announced that it was re-launching its 3G network to allow its clients to benefit from a more efficient service.

As a result, the total number of mobile, and fixed line subscribers have reached to 17.26 million and 805 thousands respectively while that of internet and data and General Packet Radio Service (GPRS) subscribers have reached to 221 thousand and 2.44 million respectively.

Besides the coverage, the quality is a main focus. To tackle frequent mobile network disruptions and slow internet connection, a program comprising 26 projects has recently been launched.

The recent announcement comes on the top of these steady progresses and on-going efforts. Last week, Ethio-Telecom signed a USD 1.6 billion telecommunication expansion project contract which is part of the GTP’s “objective of increasing telecoms service access and nationwide coverage by upgrading the existing network to the latest technology”.

The expansion project would increase the mobile service capacity to 50 million – with the 4G for the capital city and 3G service for the rest of the country. The overall network coverage will cover 85 percent of the country.