Ethiopia and Technology: The case of Ethiopian Tele Communication.

Dear Mr. Mike and all

Diaspora Ethiopians discussing on how to reform the Ethiopian Telecommunication (ETC) is a welcome gesture. I personally thank Dagmawi for raising the issue albeit in a skewed manner. The issue I did not like with ENV opinion is blaming Meles and his ideology for every shortcoming in Ethiopia. Otherwise ETC needs every bit of help to modernize and reform. If we are talking about reform then what kind of reform is needed?

Many argue that it is the private sector not a government monopoly that would help change the slow telephone penetration in Ethiopian today. At the same time the EPRDF government and others on the other hand argue that in a country like Ethiopia, the private sector is non-existence and cannot be trusted to solve the country's need as a whole.

I agree private companies may invest in the big metro cities like Addis but to expect private companies to solve the need in rural areas is to not know how private companies work at best and worst simply a lie. The government as well as other experts argues the government should manage infrastructure and other areas that are key to the development of the country. The government in many instances has sighted as an example early Japan as well as South Korea. Apparently Japan as well as South Korea has monopoly of the telecom and energy sector for long time. And no one can argue Japan and South Korea has not done well!

I concur with you however there has to be a third way for Ethiopia to follow in order to expedite the infusion of technology. In an ideal world it is the private sector that drives the technological transformation. Although government in many cases, as can be seen in many western countries, encourages and acts as a catalyst, it is rarely the sole entity that manages and creates wealth there by creating the buying power and the appetite for new technologies. However Ethiopian capitalist are not there yet to drive technology. Their existence today is merely as parasitic entities waiting in line to win government projects.

The poverty level of the population coupled with low and in some case non-existence infrastructure to support an investment by a private company be it in telecom or any other investment is an obvious obstacle the country should resolve first. To me for any one to think and pretend that private companies will be coming rushing to invest and fill in the gap if the government privatizes all infrastructure development is wishful thinking. What may work is for the government to lease certain infrastructures to private companies to provide services and give incentives to fledgling private companies within the country to develop applications to run on top of their services while the government is fully engaged expediting the infrastructure development.

In the case of ETC the government while owning the development of the telecom infrastructure through out the country, it should also look in to how to bring private companies to buy and sell services for a reasonable fee in areas where the private companies can do better. One area this may work is in Addis Abeba. The fee in return can be used to invest more on infrastructure through out the country. Short of this the other alternative is for the government to create smaller ETC through out the country how ever it see it fit. This can create a positive competition that is crucial to development.

After all, in free market economy it is the competition between private companies that is mainly the catalyst for development.

In the end if the employees at ETC do not take their job seriously and consider the citizens as their customers and the government as their shareholder no amount of changing prime minister is going to work as ENV is lobbying. Private companies treat the customer with care and reward their shareholders handsomely. There is no reason ETC should not do likewise. ETC employees need to understand a lousy service to one customer is wrong. ETC should please its shareholder, the government by implementing projects in time efficiently. ETC with its thousands of engineers should not be waiting for Chinese engineers to come in to install and implement new technologies. At the very least the hired engineers at ETC should study and understand new technologies and be able to maintain and manage it without expensive consultants from the west.

Dividing ETC in to smaller system will create competition and the government as the ultimate owner can give incentives to those who have a high grade of customer satisfaction as well as successful project completion.

Dagmawi has raised ideology as the reason for the slow infusion of cell phones in Ethiopia. I am not sure if this is not simply a political jab on Meles but in case it is not let me say my two cents worth. If Meles’s (EPRDF) ideology is an impediment to development then I am at lost.

Is it not under EPRDF we are seeing unprecedented infrastructure development that is in the making? In few years Ethiopia would have enough energy to support thousands of private companies as well as the capacity to generate foreign hard currency. With the completion of the fiber optic network that is being laid down, in few years time Ethiopia would be wired from north to south and every high school and college will be connected to the Internet. In few years time Ethiopians from Ras Dashen to the Dallol depression will be able to communicate by leased or wireless lines. EPRDF’s ideology of making sure the majority as the beneficiaries of the country’s wealth is creating an economic ground that would be the bed rock for the coming generation. The alternative ideology to this is an ideology that leaves the country at the mercy of a greedy capitalist where at best would only serve Addis Ababa and worst Bole area. An ideology that is solely driven by greed (profit) is a sure recipe to disaster in Ethiopia. It will cause in equality and create animosity with the have and have not regions. For this simple reason EPRDF is right to tread on thin line.

Having said this it is not lost in me that ETC with all its shortcomings has done wonderful. Against all odds it has successfully introduced wireless system as well as the Internet. These days except for some hiccups in the billing system no one I know is turned back from getting a wireless number. The Internet division though slow by any standard has been rendering good service. When the nationwide fiber ring is completed things will improve. I sometimes fell sorry for the folks at ETC for being forced to adapt the Internet technology of the 21^st century to the 1930 technology! They are asked to render Internet service using the old telephone lines! We should be thankful first for the hardworking employees at ETC and then ask for more if we are to be seen as useful critics that is!. Thus why I raise the analogy of the glass is half full!

Zeru Hagos

Jan 05, 2007