Ethiopia: Only Liberalisation Can Redeem Ethiopian Telecom 

There seems to be no service that Ethiopians of all colours complain about more than telecommunications. A sector destined to live under the reign of the restructured ethio telecom monopoly, telecommunications remains the hotspot for the disappointments of the ever-growing population of the nation.

At the heart of the complaint matrix rests the quality of the services provided by the monopoly. All of the services that the corporation provides, ranging from landline telephones to broadband internet, witness the same magnitude of grumbles from consumers. The cyclic quality issue facing the services is unable to find any viable solution, even after a series of quick fixes tested by the ruling elite.

Of course, the overall policy of the EPRDFites towards the telecommunications sector originates from their developmental state model, which advocates for a state that always strives to optimise the rents collected from every possible economic opportunity. If one has to go by the books of Revolutionary Democracy, then telecommunications would constitute the business core of the rent-seeking state.

But, this argument has its own version when it diffuses to the purely technical aspects of telecommunications. Its technical breed is termed universalisation.

By way of universalisation, the EPRDFites wish to expand the service provision to the most unreachable areas of the nation. And the capital base for the investment in rural areas would come from the relatively higher profit margins to be made in urban centres. Hence, inherently, the agenda of universalisation stands as a redistributive measure for both the services and the investment.

Sectoral monopolisation, therefore, is designed to result in such redistribution. As the lone beast behind the whole equation, ethio telecom is vested with the leverage to operate the infrastructure for the whole gamut of Information & Communications Technology (ICT) services. No other force is allowed to operate in the market.

By and large, the company has grown too big to be capable of constantly feeding the ever increasing demand of the state for capital. Overwhelmed with the huge demand for public investment, largely driven by its expansionary fiscal policy, the developmental state has continued to develop an unabated need for capital. And companies, such as ethio telecom, serve the agenda by acting as shadow banks.