Djibouti has firmly rejected any attempt to impose unilateral taxes or transit fees on vessels passing through the Bab el Mandeb Strait, warning that such a move would violate international law and threaten one of the world’s most important maritime routes.

In a statement issued Wednesday evening, the government said it opposes any effort by a single party to levy charges on ships using the strategic waterway, which is shared between the Horn of Africa and Yemen’s western coast.

The statement followed reports earlier in the day suggesting that Yemen’s Houthi movement was considering introducing transit fees for vessels navigating the Bab el Mandeb Strait. The narrow passage connects the Red Sea to the Gulf of Aden and the Indian Ocean and serves as a critical gateway for global trade and energy shipments.

Djibouti said it remains fully committed to the principle of freedom of navigation and to the international legal framework governing straits used for international navigation under the law of the sea.

“The Bab el Mandeb Strait is a maritime passage of global interest, shared between the African and Asian shores. Any initiative seeking to impose, from a single shore, a toll or taxation system on ships transiting through this strait would be contrary to international law, would undermine the sovereignty of the riparian States, and would threaten the security of maritime routes essential to global trade and energy supply,” the statement said.

As a riparian state bordering the strait, Djibouti said any such measure would amount to a unilateral challenge to the international status of the waterway and would further heighten tensions in an already fragile region.

The government added that it reserves the right to pursue diplomatic, legal and security measures—either independently or in coordination with regional and international partners—to safeguard its sovereign rights, protect freedom of navigation and preserve stability in the Red Sea.

Djibouti also called on the international community, relevant international organizations and countries that rely on the strait to ensure the Bab el Mandeb remains a safe and open maritime corridor governed by international law, rather than becoming a tool for advancing particular interests.

The Bab el Mandeb Strait is one of the world’s busiest shipping lanes, carrying a substantial share of international trade and energy supplies between Europe, Asia and the Middle East.

According to experts for Ethiopia, the issue carries particular significance. As a landlocked country, it depends overwhelmingly on Djibouti’s ports and the uninterrupted flow of cargo through the Red Sea corridor for its international trade.

The state-owned Ethiopian Electric Utility (EEU) announced it has collected USD 13.4 million in foreign currency over the concluded fiscal year, propelled by international electricity sales and payments from high-voltage industrial clients.
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Presenting the annual performance report, EEU CEO Getu Geremmew highlighted a strong financial year, noting that energy-sales revenue reached 76.53 billion Birr against a target of 75.17 billion Birr.

“This achievement represents a performance rate of 101.8 percent and marks a 74.3 percent increase compared to the previous fiscal year,” CEO Getu stated, adding that the figures incorporate export earnings and foreign currency tariffs from seven high-voltage industrial consumers.

In an effort to expand energy access, EEU successfully electrified 26 remote rural kebeles and towns—previously lacking grid connectivity—through off-grid solar energy solutions.
During the fiscal year, overall 205 rural kebeles and villages gained electricity access for the first time this fiscal year—a 32.3% increase from the 155 areas reached the previous year—bringing the cumulative total of electrified rural towns and villages to 7,908.

EEU reporterd that, it had planned to connect 800,000 new customers, successfully linking 664,505 households to the grid to achieve an 83.1% performance rate. This milestone marks a 32.5% increase—adding 162,917 more customers—over the corresponding period last year. Of the new connections, 56.8% received postpaid meters and 43.2% received prepaid meters, lifting EEU’s total customer base past the 5.88 million mark.

Previously, in the 2024/25 fiscal year, the EEU collected a total revenue of 63.12 billion Birr, with 43.9 billion Birr generated directly from electricity sales. During that preceding period, the utility purchased 15,000 gigawatt-hours (GWh) of electricity from Ethiopian Electric Power (EEP), successfully delivering 97.7% of that supply to consumers and achieving a collection efficiency of 96.7%.

To satisfy growing domestic and international demand, EEU planned to purchase 18,323 gigawatt-hours (GWh) of bulk power from EEP. “The utility successfully procured and distributed 18,319 GWh, achieving a 100.5% performance rate as overall power demand grew by 15.5% year-on-year” the CEO stated.

According to the report, EEU supplied 497 GWh out of its 500 GWh export target to Kenya, marking a 99% performance rate. Facilitated through the Ethiopia-Kenya 500 kV HVDC converter station—a USD 1.26 billion transmission line spanning 1,060 kilometers with a 2,000 MW capacity, primarily financed by the World Bank and African Development Bank—EEU currently supplies 265 megawatts (MW) of electricity daily to Kenya under a bilateral power purchase agreement.

Kenya has significantly escalated its power imports from Ethiopia, reaching 1,274.42 GWh by June 2025. This surge is largely driven by cost efficiency: Nairobi has increasingly favored Ethiopia’s competitively priced hydropower—costing roughly USD 0.066 per kilowatt-hour—over thermal power alternatives that can soar up to USD 0.23 per kilowatt-hour.

Meanwhile, revenue generated from new customer connection services reached 39.23 billion Birr, surpassing the 37.74 billion Birr target for a 103.9% performance rate.

Out of total power sales revenues, EEU disbursed 48.42 billion Birr to EEP for bulk energy procurement. Standard operational expenditures stood at 19.59 billion Birr, or 87.4% of the targeted 22.42 billion Birr. Notably, the utility fully covered 100% of its regular budgetary expenditures using internal revenues.

Getu emphasized that, the utility capital expenditure utilization reached 65.58 billion Birr (71% of the 92.25 billion Birr target), reflecting a 38.5% year-on-year increase. Combined standard and capital expenditures totaled 133.59 billion Birr, financed primarily through internal revenues (80.6%), government allocations (2%), foreign grants (16.2%), and foreign loans (1.2%).

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The Global Paradigm Shift

In the modern telecommunications landscape, a profound structural transformation has swept across the globe, fundamentally altering how operators generate revenue and how societies communicate. Traditional voice calling, once the undisputed cornerstone of telecom business models, has steadily retreated as mobile data consumption takes center stage. According to industry analyses from Ericsson and GSMA Intelligence, global mobile data traffic has continued to expand at approximately 20%–30% annually over recent years, while traditional voice revenues have experienced a sustained long-term decline due to the widespread adoption of over-the-top (OTT) communication platforms and changing consumer behavior. Driven by the proliferation of smartphones, social media integration, cloud services, and an insatiable appetite for digital applications, the modern digital economy increasingly operates on a “data-first” paradigm.

The strategic trajectories of leading international and regional telecommunications operators vividly illustrate this global phenomenon. Vodafone Group, one of the early pioneers of digital transformation across Europe and Asia, has significantly expanded its broadband and digital service portfolios, reflecting the industry’s transition beyond traditional voice services. Similarly, in East Africa, Safaricom PLC has witnessed rapid growth in mobile data and M-PESA, with non-voice services accounting for many service revenues in recent years. Across the continent, MTN Group reported strong double-digit growth in data revenue, with data and fintech services emerging as the primary drivers of overall business performance. Meanwhile, operators such as Airtel Africa and India’s Bharti Airtel—where average data consumption now exceeds 21 GB per user per month—demonstrate how voice has effectively become a bundled utility, with monetization increasingly concentrated around data packages, digital ecosystems, and value-added services.

Perhaps no operator better exemplifies the industry’s evolution than Reliance Jio in India. Jio revolutionized the telecommunications market by adopting a “data-first” strategy, making voice calls effectively free over Voice over LTE (VoLTE) while monetizing connectivity through high-speed data plans and digital content services. Its success fundamentally reshaped consumer expectations and provided a blueprint for operators worldwide seeking to transition from voice-centric business models to digitally driven ecosystems.

Regional Application & The Ethiopian Context

Bringing this global paradigm shift to the Horn of Africa, the Ethiopian telecommunications market has undergone a dramatic transformation. Following the liberalization of the sector and the entry of Safaricom Ethiopia, alongside the continued market leadership of Ethio telecom, the nation has rapidly progressed beyond the traditional voice-dominated era. In its most recent fiscal year performance, Ethio telecom announced a historic milestone: for the first time in the company’s history, mobile data and internet revenue reached 31.1% of total revenue, surpassing mobile voice revenue, which stood at 23.5%. This crossover signals that Ethiopia’s telecommunications sector is increasingly aligning with the global transition from voice-centric to data-centric business models, reflecting significant changes in consumer behavior and operator monetization strategies.

Drivers of Transformation

The foundational driver behind this historic shift has been the aggressive expansion of national digital infrastructure, particularly through the deployment of 4G and 5G networks. Ethio telecom’s strategic investments extended 4G services to approximately 1,200 cities, achieving more than 82% population coverage, while 5G services expanded to 33 cities. Complementing these efforts is an extensive fiber-optic backbone spanning more than 23,000 kilometers and the establishment of internationally certified data center capabilities. Collectively, these investments have significantly reduced connectivity barriers for both urban and rural populations, creating the foundation for widespread digital adoption across the country.

In parallel with infrastructure expansion, Ethiopia has experienced a notable cultural and economic shift toward digital lifestyles. Citizens increasingly rely on digital platforms not only for communication, but also for information access, financial transactions, e-commerce, education, and interactions with public services such as the Fayda National Digital ID initiative. As streaming platforms, social networks, and cloud-based applications become deeply integrated into daily life, data consumption has evolved from a supplementary service into an essential socio-economic utility.

Crucially, this operational and revenue transformation has been supported by Ethio telecom’s long-term strategic vision, particularly its “Next Horizon: Digital and Beyond 2028 Strategy” Through its deliberate transition from a conventional telecommunications provider to a technology-driven enterprise (“Telco-to-TechCo”), the organization has embraced data analytics, artificial intelligence, and customer-centric innovation. During the latest fiscal year, the company introduced hundreds of digital products and services tailored to evolving market demands, reinforcing its ambition to serve as a catalyst for Ethiopia’s broader digital transformation agenda.

Another significant catalyst accelerating the “Data over Voice” transition has been the growing accessibility of smartphones and connected devices. Historically, device affordability represented a major barrier to digital inclusion. However, smartphone financing initiatives, strategic partnerships, and declining handset costs have enabled a broader segment of the population to access internet-enabled services. As smartphone penetration expands, so too does demand for mobile broadband, creating a sustainable cycle of increased data consumption and deeper digital engagement.

In a nutshell, Ethio telecom’s achievement of generating greater revenue from mobile data and internet services than from traditional voice services represents more than a financial milestone, it reflects Ethiopia’s entry into the global digital era. Supported by extensive infrastructure investments, strategic foresight, and changing societal behaviors, the company generated ETB 215.82 billion in total revenue during its latest fiscal year while strengthening its position as a key enabler of the nation’s digital economy. By maintaining operational excellence, expanding digital financial services, and continuing its transition toward a technology-centric enterprise, Ethio telecom is increasingly positioning itself not merely as a telecommunications operator, but as a future-ready digital platform driving sustainable national development.