Why Ethio telecom Matters Most

The decision by EPRDF’s Executive Committee to partially privatise major enterprises has largely been met positively. There were protestations that privatisation would create an oligarchy, but those voices seem to have muted after the establishment of an advisory council.

Labour unions have been left out, and we have yet to see the code of conduct to repel capture by personal interests. But the professionalism of the members and the inclusiveness of the council is more than can be said for Ethiopia’s parliament.

A point that is irritating many is that Ethiopian Airlines is going to have its shares sold. A massively successful enterprise that has shares in a number of African airlines, it is one of the most significant assets Ethiopia has. But it is far from perfect. Its monopoly of the domestic market has made flying expensive for ordinary Ethiopians and the government’s support for it has come at the expense of the growth of the aviation industry.

Ethiopian should have long been made to play on a level playing field. This is not merely for the benefit of private players but customers that should be able to choose which airline they would prefer to take for a domestic flight. Airfare would become less expensive as a result of competition, new sources would be introduced, and the industry could get a boost. Even domestic tourism can benefit from this.

But the services of Ethiopian, even cheapened, are luxuries compared to public services such as education, electricity, clean water, healthcare and waste management. In this age, necessary additions are the internet and communication services Ethio telecom provides. Any Ethiopian ought to be privy to them regardless of income or talent.

The most significant attribute of a government should be its institutions’ ability to allow all individuals equal opportunities. There is nowhere on Earth where this is entirely true. Income classes have been unavoidable under any system of government humankind has instituted thus far. As in Ethiopia, there are more opportunities open to children born to wealthy parents in a Scandinavian country than otherwise too.

But some economic institutions allow economic mobility based on merit better than others. A great component of this is the state’s ability to provide citizens with services that are necessary for gaining skills. In the 21st century, these are networking, creativity, oral and written communication and digital literacy. A child from a low-income family ought to be as reasonably productive and innovative as a counterpart from an affluent family.

Such skills can only be developed if an individual has easy access to what the European Commission accurately describes as, “services of general interest.” They are the opportunities a government ought to arm its citizens with in an age where the labour market is ever expanding, and competition as a result of globalisation and technological disruption are rife.

It would be nice if everyone could afford to fly, but it is much more important that citizens get cheap and standard education, electricity and telecom and transport services.

This is why it should not matter whether or not Ethiopian is sold as much as Ethio telecom as its services’ prices may rise. Understandably, not much love is lost between the telecom company and users. Its services are pricey without being efficient, and customer service is notoriously irritating.

But the services it gives are exceptionally consequential given the age we live in. There is a global revolution in information technology. If we are not a part of it in much the same manner as the industrial revolution once eluded us, it would be a tragedy of epic proportions – a disservice to future generations and a continued subservience of Ethiopia to Western, Eastern and maybe sub-Saharan African powers too.

Ethio telecom’s recent decision to reduce its tariffs is commendable. Digital technologies need to diffuse, which would be unlikely if telecom services remain unaffordable. But they can still go down, and this can only be possible if more telecom companies are allowed to enter the industry. Competition will not just cheapen services. They would be more efficient, and new ones will be introduced.

Private interests are drivers of innovation under the right regulatory circumstances. But only when the government provides public services can we be sure they would be affordable in a developing country such as Ethiopia.

If service providers like Ethio telecom are forced to function in an equal playing field, they are some of the most powerful tools the government has to create a competitive economy.


By Christian Tesfaye (christian.tesfaye@addisfortune.net)
Christian Tesfaye is Fortune’sOp-Ed Editor whose interests run amok in the directions of both print and audiovisual storytelling.

Published on Sep 01,2018 [ Vol 19 ,No 957]



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