A landmark regulation approved by the Council of Ministers is set to transform Ethiopia’s digital landscape, mandating a historic contribution from telecom operators to connect the nation’s most remote communities.
In a major policy shift aimed at accelerating its digital economy ambitions, Ethiopia has officially established the “Universal Access Fund,” a dedicated financial mechanism designed to eradicate technological isolation in rural and underserved areas. Regulation No. 585/2026, approved by the Council of Ministers, marks a pivotal moment in the country’s quest for digital inclusion, ensuring that the benefits of connectivity reach every citizen.
The fund’s primary engine will be a mandatory 1.5% contribution on the annual gross revenue of all licensed telecommunications service providers operating in the country. This bold financial mechanism empowers the Ethiopian Communications Authority (ECA) to collect and strategically deploy resources to bridge the infrastructure gap that has long left rural populations, schools, and health centers on the wrong side of the digital divide.
In a move that balances ambition with market realities, the regulation introduces a “Pay-or-Play” principle, offering operators unprecedented flexibility. While companies can fulfill their obligation through direct monetary payments into the fund, they are also empowered to meet their targets by directly investing in network expansion. By building infrastructure and delivering services in designated unserved areas, operators can deduct the incurred costs from their 1.5% revenue contribution, turning a regulatory requirement into a strategic investment opportunity.
To further stimulate competition and lower barriers for new entrants, the Council of Ministers has included a critical incentive: a three-year grace period for newly licensed operators, exempting them from the contribution as they establish their foothold in the market.
The fund’s mandate extends far beyond basic infrastructure. It is explicitly designed to be a catalyst for social equity, prioritizing connectivity for rural schools and healthcare facilities, and ensuring access for women, persons with disabilities, and low-income households. Furthermore, the fund will actively promote the growth of local digital content and technological products in indigenous languages, fostering a uniquely Ethiopian digital ecosystem.
To ensure robust compliance, the ECA will enforce strict penalties. Operators failing to remit their contributions will face a 2% penalty for the first month of delay, escalating to a sharp 5% for each subsequent month of non-payment, underscoring the government’s commitment to the fund’s success. This new regulation signals a decisive and structured approach to building a connected and inclusive digital future for all Ethiopians.
