In a landmark move to strengthen the resilience of Ethiopian agriculture, the Ethiopian Agricultural Insurance Consortium (AICE) was officially launched, pledging to extend insurance coverage to 3 million smallholder farmers by 2026. This initiative aims to shield farmers from climate-related risks and foster a more investment-friendly agricultural sector.

The consortium unites five leading Ethiopian insurance companies— Nyala Insurance, Africa Insurance, Ethiopian Insurance Corporation, Nile Insurance, and Oromia Insurance—with technical support from Pula Advisors, a global insurtech firm specializing in agricultural insurance solutions. Together, they form a unified platform to collaborate with government agencies, donors, and development partners to transform Ethiopia’s agricultural insurance landscape.

Agriculture accounts for roughly one-third of Ethiopia’s GDP and employs about 85% of the population, yet over 95% of smallholder farmers currently lack formal crop insurance. Recurrent droughts, erratic rainfall, pests, and diseases frequently devastate harvests, forcing families to sell assets, deplete savings, or depend on humanitarian aid. The AICE initiative seeks to break this cycle by scaling affordable, technology-driven insurance products that stabilize farmers’ incomes, unlock credit access, and encourage the adoption of productivity-enhancing inputs such as improved seeds and fertilizers.

The consortium’s first product, “B-crop,” is an environmental index insurance solution designed to protect farmers against systemic hazards like drought, excessive rainfall, pests, and diseases. This product has already been piloted successfully across three regions and more than 200 districts, demonstrating its adaptability to Ethiopia’s diverse agricultural conditions.

AICE’s insurance model is integrated with the government’s Product Input Voucher System (IVS), which helps reduce premiums through risk pooling and government subsidies, making coverage more affordable for farmers. Currently, this model covers over 10 million farmers across more than 200 woredas (districts) at a subsidized cost of approximately 200 birr per farmer.

To address the challenge of limited awareness, the consortium is investing in extensive farmer education programs, including training sessions, nationwide roadshows, SMS and interactive voice response (IVR) messaging, and collaboration with government extension agents to incorporate insurance education into existing advisory services.

Technological innovation is central to the consortium’s approach. Leveraging Pula Advisors’ digital tools such as Mavuno, an AI-powered data collection platform, and the Pula Insurance Engine (PIE) for intelligent product design and policy management, AICE aims to deliver efficient, data-driven insurance services that are responsive to farmers’ needs.

The Ethiopian government has expressed strong support for the consortium. Officials from the Ministry of Agriculture, the National Bank of Ethiopia, and other stakeholders participated in the launch event, underscoring the importance of financial inclusion and sustainable rural development. The government has also established a Rural Financial Services Unit within the Ministry of Agriculture to coordinate efforts to expand access to agricultural finance and insurance nationwide.

Over recent years, Pula Advisors, in partnership with the Agricultural Transformation Institute and development partners such as the World Food Programme and KfW, has helped nearly one million Ethiopian farmers gain insurance coverage. The consortium builds on this momentum to scale solutions and improve the sector’s technical capacity.

Safaricom Ethiopia has raised concerns over the current pricing structure of mobile data services, warning that selling data below cost is unsustainable and threatens the long-term viability of the telecom sector in the country. The company highlighted that Ethiopia’s average mobile data prices are approximately three times lower than the African average, a disparity that, while driving rapid customer growth, poses serious challenges for future investment and infrastructure expansion.

Wim Vanhelleputte, CEO of Safaricom Ethiopia, emphasized the urgent need for “price rationalization,” particularly regarding heavily discounted large data packages. He explained that while a single gigabyte of data costs about 35 birr, purchasing a 200-gigabyte package reduces the price per gigabyte by six times, resulting in discounts of 80 to 90 percent. This pricing imbalance, Vanhelleputte noted, is unfair to customers who buy smaller data packages and undermines the company’s ability to generate profits necessary for expanding network infrastructure.

Safaricom Ethiopia estimates that the telecom industry requires an additional investment of 500 billion birr over the next three years to significantly enhance network coverage and quality. Such investment would be difficult to sustain without adjustments to the current pricing model.

Despite these challenges, Safaricom recently celebrated a major milestone, announcing that it has reached 10 million active customers within a 90-day period—an impressive feat achieved less than four years after receiving its operating license. The company likened this customer base to the population size of Belgium, underscoring the rapid adoption of its services.

Since its market entry, Safaricom has invested over 300 billion birr (more than US$2.5 billion) in infrastructure development. The company currently operates more than 3,000 telecom towers, covering over half of Ethiopia’s population. With an average daily addition of 30,000 new customers, Safaricom attributes its growth to customer confidence in its fast and reliable mobile and voice services.

Data usage among Safaricom customers is notably high, with nearly 75 percent of users accessing data services monthly and consuming an average of over 6 gigabytes each—more than 50 percent above the African continental average.

The company employs over 900 staff members, 97 percent of whom are Ethiopian nationals. This local workforce is central to Safaricom’s commitment to building a telecom ecosystem “by Ethiopians for Ethiopia.”

Wim Vanhelleputte expressed the company’s goal to achieve financial profitability within the next 6 to 12 months. Reaching this milestone would enable Safaricom Ethiopia to allocate future funds primarily toward network expansion rather than covering operational start-up costs.

Safaricom plans to double its network footprint over the next three years, increasing the number of live towers from 3,100 to more than 6,000 by December 2028. This expansion aims to extend internet, voice, and financial services coverage to 80 to 90 percent of the population, including both urban centers and rural areas.

The company acknowledged the initial challenges faced in navigating Ethiopia’s newly liberalized telecom market but stressed that healthy competition benefits the industry and consumers alike. Vanhelleputte remarked, “Competition is not a zero-sum game. In a market economy, it’s about growing the market.” He highlighted the complementary roles of Safaricom and Ethio Telecom in expanding customer numbers and overall market size.

Addressing concerns about network availability in conflict-affected regions, Safaricom noted improvements in security over the past 6 to 12 months. The company has launched services in areas such as Dessie and Kombolcha and plans to expand coverage to Gondar and Bahir Dar in the near future.

The International Monetary Fund (IMF) is calling for closer monitoring of banks’ net open positions (NOP) as Ethiopia advances its economic reforms.

In its latest statement, the IMF advised Ethiopian authorities to carefully oversee banks’ NOP, a regulatory requirement that all banks were expected to satisfy by the end of the previous financial year.

The IMF’s recent assessment highlighted the need for the National Bank of Ethiopia (NBE) to shift towards using the policy rate as its primary monetary policy tool. This move would replace traditional quantitative credit controls and enhance the management of inflation. This recommendation arose from the IMF’s Article IV consultation—the first in six years and the third review under Ethiopia’s Extended Credit Facility (ECF) arrangement.

The IMF’s Executive Board approved a USD 262 million disbursement, the fourth tranche of the USD 3.4 billion ECF program, recognizing Ethiopia’s progress in macroeconomic reforms over the past year.

Nigel Clarke, IMF Deputy Managing Director and Board Chair, commended Ethiopia’s strong reform efforts, noting resilient growth and a decline in inflation.

“Measures to modernize monetary policy, increase domestic revenue, strengthen social safety nets, reform state-owned enterprises, and ensure financial stability are yielding positive results,” Clarke said. “However, security challenges and declining donor support remain ongoing risks.”

He welcomed the NBE’s initiative to deepen the foreign exchange (FX) market and reduce distortions but urged caution, recommending additional measures if FX supply weakens or parallel market spreads widen.

“Maintaining tight monetary and financial conditions is crucial for controlling inflation,” Clarke added. “Next steps should include decisively shifting to a policy rate-based framework and enhancing the central bank’s communication and analytical capacity.”

The NBE has indicated its commitment to a tighter monetary stance, planning to utilize policy rates and other instruments to maintain control while preparing to lift credit caps in September.

The IMF emphasized the necessity for continued revenue mobilization to address fiscal gaps, alongside prudent spending and the development of the domestic bond market.

“Reducing financial repression and strengthening oversight will enhance financial stability and support private sector-led growth,” Clarke stated, underscoring the importance of monitoring credit risks and banks’ NOP compliance.

Earlier this year, the NBE instructed banks that did not meet NOP thresholds to achieve full compliance by June 2025, with the state-owned Commercial Bank of Ethiopia potentially receiving an additional one-year extension. The central bank also plans to refine NOP measurement, update prudential regulations, and improve data collection on banks’ FX positions.

Ethiopia’s chronic hard currency shortage has begun to ease since reforms were initiated in mid-2024, a development that the IMF has praised.

Authorities report progress in enforcing NOP rules, mitigating financial stability risks, and improving FX market transparency through measures such as regular forex auctions for banks.

The IMF urged further efforts to sustain gains in the FX market, enhance reserve coverage, and phase out remaining FX restrictions. It also called for finalizing the NBE’s legal reforms, including the appointment of qualified board members to strengthen institutional autonomy.

“Continued reforms will be crucial for locking in progress, maintaining competitiveness, and ensuring long-term stability,” the IMF concluded.