We’ve written a lot this year about the effect of the devaluation of naira on telecoms services in Nigeria. But another African country where service providers have been hit by the devaluation of its currency is Ethiopia, whose state-owned telecom provider, Ethio Telecom, has now announced tariff increases across many of its services.
These are apparently due to rising operational expenses resulting from the country’s new floating exchange rate policy implemented two months ago.
Like the Nigerian naira, whose devaluation hit a number of operators’ bottom lines, albeit much more seriously, the devaluation of the Ethiopian birr (ETB) has inflated Ethio’s costs, especially for imported technology, international bandwidth, and equipment – most of which are paid for in foreign currencies.
The tariff adjustments are a response to this, albeit Ethio Telecom has made efforts to keep certain popular low-cost packages affordable.
Thus while pay-as-you-go (PAYG) voice services have seen a 20% price increase, data PAYG remains unchanged. Other data packages, and voice packages, along with the cost of a SIM card, have gone up, but the unlimited monthly mobile data package remains the same.
Most of these tariffs have risen by between 18% and 37%. By contrast international call rates have surged by up to 658%, and Telebirr (mobile money) transfers to banks have also seen a sharp increase, apparently because of the rising costs of infrastructure and services that rely on foreign currencies for equipment and maintenance.
It's not clear whether rival operator Safaricom Ethiopia will also put up its prices.
