Safaricom Backs Ethiopia Digital Transformation

Safaricom Telecommunications Ethiopia (STE) teams up with Sumitomo Corporation, JICA, and Ethiopia's Ministry of Innovation and Technology to boost Digital Ethiopia 2025, with a Memorandum of Collaboration (MoC) creating working groups for innovation, job growth, and regulatory improvements across sectors.

Safaricom's Role in Advancing Digital Transformation in Ethiopia

Safaricom Telecommunications Ethiopia (STE) has consistently highlighted its potential to take a leading position in each of the four key focus areas established by the working groups. 

• Job Creation: Safaricom Telecommunications Ethiopia (STE) has created 909 jobs in its first year of operation, with 80% of employees being local hires. This demonstrates the company's commitment to job creation in Ethiopia.

• Financial Services: Safaricom has a significant track record in financial services, particularly through its M-PESA mobile money platform. STE obtained a licence to operate M-PESA in Ethiopia earlier in 2023, which is expected to challenge the state-owned Telebirr.

• Regulatory Environment: Safaricom has commended the Ethiopian government for liberalising the financial sector and supporting the entry of foreign-owned entities, such as M-PESA.

• Investment: Sumitomo, one of the partners involved in the Memorandum of Collaboration (MoC), holds a 27.2% stake in the consortium that established and operates STE. Sumitomo contributed $231 million towards the $850 million licence fee paid to the Ethiopian government in 2021.

• Leadership: Stanley Njoroge is currently serving as STE's interim Chief Executive, while Wim Vanhelleputte is set to take over as CEO in September.

Additionally 

The launch of M-PESA in Ethiopia is a particularly exciting development. M-PESA has been a huge success in Kenya, and it has the potential to revolutionise financial services in Ethiopia. 

M-PESA can help to promote financial inclusion and economic growth by providing access to financial services to the millions of Ethiopians who are currently unbanked.

Lessons from Kenya on Public-Private Partnerships

The article delves into Kenya's fruitful public-private partnerships, emphasising sustainable development. It also examines Safaricom Telecommunications Ethiopia's collaboration with Ethiopia to provide connectivity in a formerly monopolised market while fostering positive government and regulatory relationships.

Digital Ethiopia 2025 Agenda and Inclusive Growth

Ethiopia's Digital Ethiopia 2025 agenda is aimed at unlocking the nation's potential by ensuring that the benefits of the digital economy are inclusive and accessible to all citizens. The Minister for Innovation and Technology, has emphasised the importance of the Memorandum of Collaboration (MoC) as a response to the call for stakeholders and development partners to accelerate the country's digitalization strategy.

Safaricom's Experience in Government Collaboration

Safaricom has a track record of working closely with national governments, particularly evident in its home market, Kenya. The company has long prioritised efforts to drive a digital agenda. In its most recent Annual Report, Safaricom highlighted the pivotal role of state collaboration in its medium- to long-term strategy, with a focus on democratising access to connectivity and digital financial services.

Safaricom's Contributions in Kenya

In Kenya, Safaricom has actively supported the digitalization of over 6,000 government services through the state's eCitizen platform. This involvement extends to the creation of loan distribution networks such as the Hustler Fund and Women's Enterprise Fund. Furthermore, Safaricom's MyCounty App serves as another example of its engagement with local government to digitise service provision, with substantial support from the M-PESA mobile money platform.

FAQS

What is Safaricom's commitment to Ethiopia's digital transformation agenda?

Safaricom is dedicated to actively participating in Ethiopia's digital transformation agenda through various initiatives and collaborations.

What is the significance of the Memorandum of Collaboration (MoC)?

The MoC serves as a formal agreement that outlines the commitment of Safaricom and its partners to collaborate on specific projects and initiatives to advance Ethiopia's digital transformation.

What areas of focus are outlined in the MoC?

The MoC focuses on establishing joint working groups to support regulatory frameworks, job creation, and innovation in various sectors, including multi-sector business ecosystems, digital interaction, digital financial services ecosystems, infrastructure development, and capacity building.

How has Safaricom contributed to job creation in Ethiopia?

In its first year of operation, Safaricom Telecommunications Ethiopia (STE) employed 909 individuals, with 80% of them being local hires, demonstrating its commitment to job creation.

What role does Safaricom's M-PESA mobile money platform play in Ethiopia?

Safaricom was granted a licence to operate M-PESA in Ethiopia, which is expected to provide digital financial services to the Ethiopian population, presenting competition to state-owned Telebirr.

How has Safaricom engaged with national governments in other countries?

Safaricom has a history of collaborating closely with national governments, including its efforts to support the digitalization of government services in Kenya and democratising access to connectivity and digital financial services.