Globalization Advisory

Drivers of Change in Ethiopia – Growing the IT/BPO sector through leveraging ICT

Dr Pradeep K. Mukherji, Shobhit Patnaik & Alok Ranjan

The changing landscape of IT/BPO industry has led to the emergence of new locations in Africa. Among many African nations, Ethiopia is growing at the rate of more than 10% per annum and is likely to attain the middle-income status by 2025. Leveraging ICT with a focus on capacity building is catalyzing economic prosperity and creating sustainable employment opportunity in the country.

Ethiopia, the landlocked country with a rich historical past, has embarked on a path of economic and social transformation, catalyzed by technology. With economic growth rate of more than 10% per annum, the country of over 91 million (2012 estimates) is expected to attain the middle-income status by 2025, according to projections of the World Bank. With the progressive macroeconomic management, stable government and burgeoning privatization, information and communications technology (ICT) is helping the country to become a significant growth economy in Africa, drawing keen attention from international business community.

The ICT landscape in Africa is being shaped by the multi-stakeholder partnership, the growing convergence of communication and information technology and a mobile revolution resulting in extensive rollout of mobile technology. First commercial LTE 4G networks has already been launched in Angola, Mauritius, Namibia and Tanzania. This network will soon be launched in countries like Egypt, Kenya, Nigeria, and South Africa. According to a GSMA report (2013), mobile telephony is expected to generate 6.6 million jobs by 2020 in the continent and is considered a major economic growth driver. Sub-Saharan Africa has been proactive in growing its ICT infrastructure, mobile network along with broadband access and leveraging the investment for socio-economic transformation. Countries in North Africa have been less successful in this regard. There have been few challenges in widespread rollout and absorption of ICT, due to high cost of ICT infrastructure, gap in availability of technical skills and lack of entrepreneurial and innovation friendly business and economic climate. Progressive governments in the region have been putting in place initiatives to address these challenges and work towards achieving economic prosperity for its inhabitants.
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