Ethiotelecom, Ethiopia’s state-owned telecom provider, has announced plans to implement tariff reforms on select products and services in the near future. This move comes just a month after the government’s macroeconomic policy reforms, which included the floating of the Ethiopian birr.
Frehiwot Tamiru, the CEO of Ethiotelecom, stated that the tariff reforms will take into account the ability of customers to pay. She emphasized that while prices will not be increased across the board, there will be targeted improvements to certain products and services.
Over the past two decades, during which the birr has depreciated by more than 750%, Ethiotelecom has significantly reduced prices in the last six years, making its rates among the lowest in the world and highly affordable for users. With the current floating of the birr, the rates in foreign currency will become even more competitive.
In September 2018, Ethiotelecom announced a 40-50% tariff reduction and implemented various improvements. The latest reports show that the company charges lower prices compared to other telecom providers in the region.
“We held off on adjusting tariffs because we wanted the macroeconomic changes to stabilize and be healthy for our customers, as well as for the economy in general,” Frehiwot explained.
While the CEO acknowledged that the current tariffs for voice and data services are already low, she refrained from providing a specific timeline for the implementation of the new tariffs, stating that plans are in place to introduce them.
Ethiotelecom is also aiming to increase its foreign exchange earnings and provide competitive services to expand international revenue and foreign exchange-generating sectors in size and type. The company plans to raise its foreign exchange earnings to $282.85 million in the current fiscal year by upgrading its foreign exchange service, remittance services, and expanding partnerships.
In the 2024/25 fiscal year, Ethiotelecom has budgeted over $1 billion for digital infrastructure expansion. The company plans to add 5 million customers in the current fiscal year and generate 163.7 billion birr in revenue, a 74.4% increase from the previous year’s 93.7 billion birr.
Frehiwot stated that Ethiotelecom aims to build more than 1,000 mobile stations by 2024/25 and focus on providing technological innovations and solutions beyond just connectivity. Digital Ethiopia also plans to have 500 cities with 4G and 15 cities with 5G network coverage this year, with the number of users expected to increase from 78 million to 83 million, and Telebirr users from 47.5 million to 55 million.
As Ethiotelecom navigates the changing economic landscape, its tariff reforms and expansion plans demonstrate its commitment to providing affordable and competitive services while generating much-needed foreign exchange for the country.
