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May 3, 2009

How to make a lot of money banning the Internet: the case of Ethiopia

This is about the ridiculous state of the Internet in Ethiopia (the worse in the whole freaking world -worse even than Somalia or Burundi according several reports from independent technical organizations -see here, here, here:


or google for it), the role of the State with its Jurassic state monopoly of communications (ETC) which offers the above said "service" at the most obscenely expensive price ever seen on the planet (so making a lot of money for the Gov't), and providing to the same Gov't another less expressed -but probably not less important/desired- result: the maximal limitation of free social communication without the need of openly banning the Internet.

This is just another example of how a prohibition (in this case prohibition to use Internet service providers different from the ETC) can serve very well the aims of income generation and power consolidation for a political elite, at great disadvantage for the mass of the population.

Wait, there is more: governmental regulators surpassed every barrier of ridiculous outlawing Voice-over-internet calls (they are a criminal offense in Ethiopia, worth of a number of years in jail, like they were technically possible with a network performance making an interminable agony just browsing ordinary web sites). Officially, the "justification" for this VOIP ban is to defend the fat profits of the telephony state monopoly, but maybe even in this case there may lie other unstated designs.

My interest for this subject is both personal and more general, political and intellectual : I am a ferenji (means "white skinned" in Amharic) married to an Ethiopian living in Europe. We dreamed up to now of buying a house in Ethiopia with our savings and maybe start a business too later in life, but after my trip there last year I know that I could not stay there for long: can you imagine not being able to download your email even trying daily for weeks from self-described "broadband" Internet cafes in central Addis Abeba? (I tried speedtest.net from there obtaining a ping>6,000 msec at the best! That is much worse than in the year zero of the Internet, like the early nineties with a 2,4000 bps modem! Ridiculous!).

Now, one of the most popular business sectors for expatriates (and not only) in the "Third world" is IT: Internet cafes, web editing and whatever, but Internet cafes are a bad joke in Ethiopia, and you can just forget anything web-related, so, in the last instance, this situation will (and much likely already does) imply a big loss of revenue and investment for the country. And here is where personal interests brings to political economy, and where one can see that the so-called "developmentalist" attitude of the Ethiopian Gov't is just plain dumb: authoritarian and ultimately self-defeating (I hope, since I still want to go to live there, when there will be a free Internet market like in every civilized country).

Another interesting point is that you don't find much public dissent about it in Ethiopia, in part because obviously much of the population has other more urgent problems to deal with, but even because they have never seen how Internet should be (since this Gov't is ruling from the early 'nineties). Just expatriates know it, and even them are silent because... well, I think just because it does not bring luck to protest, even in the most pacific and civilized manner, like signing a petition, in this regime -formally a democracy. And that is why I prefer to remain anonymous and not sign this article: because me too would like to go to live there one day and not find Government-originated special problems.

Let me conclude quoting the interview from Bloomberg to the Ethiopian Minister of Trade to give you some taste of the arrogance of the inept now governing that great country:

"Ethiopia will not liberalize Telecoms and Banking

Girma Birru, Ethiopia's trade minister, said Ethiopia has no plans to liberalize the telecommunications and financial-services industries to gain access to World Trade Organization (WTO), Bloomberg news reported.

“Primarily we will join the WTO not to make others happy, but to make our economy work,” Birru said. “So to the extent it helps our economy we will liberalize things, but if it’s not going to assist our goals in trade and development we will not liberalize. Why do we have to?”

“I don’t see any plan” to break up or sell Ethiopian Telecommunications Corp. to private investors, Birru said. “If there are some problems it has nothing to do with ownership. It has only to do with management. Management and ownership don’t necessarily go together.”

According to Bloomberg news, Ethiopian Telecommunication charges $35 for a mobile-phone SIM card, where in neighboring Somalia and Kenya it costs less than $5. A 1-megabyte per second Internet connection costs more than $2,000 a month in Ethiopia. In South Africa, the continent’s biggest economy, a similar service costs between 600 rand ($59) and 760 rand, according to the http://www.mybroadband.co.za Web site.

Newai Gebre-Ab, chief economic advisor to Prime Minister Meles Zenawi, said "the company [ETC] is “generating a lot of money and that money is being put to good use for development of infrastructure,”.

Read Original Report from Bloomberg News

Girma Biru

Trade Minister Girma Birru

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