The ICT sector is fast-growing. To unpack this, Co-founder and CEO of iceaddis – Ethiopia’s first innovation hub and tech incubator – Markos Lemma talks to his experience of the East African country’s innovation ecosystem:
How do you picture the development of ICT in Ethiopia?
When we started iceaddis in 2011, Internet penetration was less than 1% among the population; and the role of ICT was limited. 10 years have passed since then; the internet penetration rate is around 19% today.
We have seen significant progress in infrastructure, service provision, human capital and research. There are key players in the ICT sector and there is political willingness to advance this sector. In this regard, the contribution of the private sector is unneglectable.
The Ministry of Innovation & technology and other government agencies, such as the newly created Ethiopian Communications Authority (ECA) also plays a key role in steering and regulating. Meanwhile, we have observed a significant driving force from international partners and market players like Huawei, Microsoft, Google among others.
In addition, we should particularly appreciate startups and the young innovators who are developing new products and tools on a daily-basis, advancing ICT in Ethiopia.
How has COVID-19 affected the digital development of Ethiopia?
In the globalized and well-connected world, we have seen that Covid-19 created a huge impact and continues to have impacts. The health sector In Ethiopia has been tested and many entrepreneurs lost their jobs and businesses.
For many, this has been a challenging year. Yet, there are also some advancements especially in adopting new digital tools and online habits.
One of the most important lessons for most people are, it is possible to continue to be productive, work and collaborate digitally. We have improved telecommunication infrastructure. The cost of the internet is decreasing. This enables lots of people to spend longer time online, uninterrupted.
On the other hand, the number of new services increased and the previous one enjoyed good traffic. To mention a few, the delivery business has been an all-time high. And eCommerce is slowly picking up and expected to grow even more this year with the new directives from the National Bank of Ethiopia and significant investment from financial institutions and fintech ventures.
What opportunities do you see in the strengthening of the ICT sector?
There is a young population who are ready to connect and collaborate in Ethiopia. This is the most important opportunity. But to cover this young population and growing economy the ICT sector needs to be reinforced. We need to develop the infrastructure further.
Liberating the telecom sector is a very crucial step the government is taking. Competition fuels progress, which is healthy for our institutions. In the meantime, our ICT sector lacks human capital. Universities and other educational institutes can take this opportunity to strengthen their quality of delivery.
Apart from healthcare and education, how has mobile technology development improved life quality in Africa?
Mobile technology development made an exceptional contribution to the economic and human development of many African countries. People are connected. There is significant adoption of innovation in Africa delivered through mobile phones.
Taking fintech as an example, unbanked individuals don’t look into banks, but their mobile phones through APP. This also happens with insurance and other financial services. Another example is education.
Digital literacy and linguistic literacy are going hand-in-hand. Skills have been utilized online through mobile technologies. In terms of mass media, mobile technology combined with social media let people watch and report information faster, thus improved civil service quality. 10-15 years ago, people might doubt the role of mobile technology in the development in Africa; nowadays there is no one arguing about the truth.
What are the latest environmental innovations that digital development has allowed in Ethiopia?
Precision agriculture has been improved by digital development so far. But this is in the early stage and not adopted by the target groups. Since agriculture is the drive of the country’s economy, I’m convinced that there is a lot of work needed to be done around the circular economy in Ethiopia.
How do you believe the tech startups ecosystem in Ethiopia could be improved?
There are several crucial aspects that need to be improved in the ecosystem:
First, the government is responsible for the framework condition and policy-related improvements.
Second, access to finance is the most persistent challenge for most Ethiopian startups. The big corporate and individual investors in the private sector need to step up and start to provide financing for tech startups, particularly as business angels.
To achieve this, investors need to make a deep analysis, getting more awareness and willingness.
Finally, yet importantly, as entrepreneurs and startup founders, we need to question ourselves too. Being professional, learning hard and soft skills, challenging each other ideas, looking up to business competitions instead of pure IT outsourcing will help us strengthen the tech and startup ecosystem in Ethiopia, for everyone’s benefit.
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