Governance and startups — the Ethiopia experience

Last month, Seedstars World held its first challenge in Ethiopia’s capital city of Addis Ababa and the event featured eleven of the country’s best startups. AhadooTec’s Fidel which is Ethiopia’s first mobile learning platform, won the competition. And last Monday, as my taxi slowly left the Addis Ababa Bole International Airport, I began to ponder on why Ethiopia — which is the most populous landlocked country in the world, as well as the second-most populous nation on the African continent after Nigeri — was just having its first mobile learning platform in 2015!

Perhaps the Ethiopian calendar, which is seven years and around three months behind the Gregorian calendar, is an indication of the country’s disconnection with the developments in the startup ecosystem in other parts of the continent.

“Paul, I don’t want soldiers banging on my door over a product I developed. Unlike in Nigeria where you may get away with such things, here in Ethiopia, you can be easily tracked and you wouldn’t want the government to descend heavily on us,” a software engineer from Addis Ababa told me.

If you were visiting Lagos for the first time, for instance, you would see billboards of Nigerian ecommerce companies and major tech giants competing for space with those of major alcohol beverages, banks and telecoms companies. But the story wasn’t the same in Addis Ababa — at least from the airport to most streets in the city. I concluded that if there were an existence of a tech ecosystem, the companies are still at its early stages. This was totally far from what obtains in close by, Kenya where tech companies are making bold business moves just like their counterparts in Nigeria.

I came to understand that there are several bottlenecks that are limiting the growth of the startup ecosystem in Ethiopia, and a good number of such could be linked to governance and government policies.

Strained relationship with Kenya

Ethiopia seems to have a strained relationship with Kenya as both countries are consistently exchanging fire at border points with the most recent of such leaving four Ethiopian soldiers and three Kenyan police officers dead. This means it would be difficult for the startup ecosystem in Ethiopia to benefit from the advancements in Kenya.

Language barrier

Language, I believe, is one of the major barriers to the development of the startup space in Ethiopia. Just as Francofrique’s startups are complaining of being isolated, the Amharic language may be making it difficult for startups in Ethiopia to gain continent-wide relevance. Very few Ethiopians speak English language while the rest are much more fluent in Amharic. Which means that even when entrepreneurs have great ideas, it would be very difficult to communicate such idea perfectly to someone outside the country.

Lack of government support

Governance appears to be the greatest challenge that is limiting the growth of the local tech space in Ethiopia. Even though the roads are very good and the country can account for almost everyone, the authoritarian/dictatorship form of government may not be allowing innovative Ethiopians to freely develop tech products without having to present it first to someone from the defence ministry.

Read more: Everything you need to know about the East African startup landscape [2015/2016 Update]

According to the Democracy Index published by Economist Intelligence Unit, Ethiopia is an “authoritarian regime”. It ranked the 118th-most democratic out of 167 countries. The government cracks down on opposition activities, media and civil society, making the country a de facto one-party state.

This authoritarianism is strongly felt in every space of the economy. For instance, the only major airline in the country is owned by the government. The government also controls the major bank in the country. Furthermore, the major telecoms company in Ethiopia is owned by the government. Which suggests that tech developers in the country do not have the carte blanche to develop anything they like and promote to anyone, and anywhere. Interestingly though, this is not the case elsewhere.

Read more: Ethiopia’s tech landscape: unique challenges, massive potential

In most African countries where startup ecosystems are a bit advanced, democracy seems to be the predominant style of governance. Take Nigeria for instance, anyone can develop any tech solution. The situation is the same in South Africa, where citizens often share ridiculous posts and multimedia contents that attack the president and other members of government.

Kenyans too also deploy tech tools to make their opinions known — a good example was the great online outcry that heralded the government’s decision to introduce e-tolling on some roads. The strong rejection of the government’s decision online was strong enough to shut the whole thing off. But in nearby Ethiopia, the government can easily shut down any tech tool or social media platform that the citizens may decide to use to let the rest of the world know about what is wrong in their society.

Interacting with some Ethiopians also made me realise that there is a very strong reluctance on their sides to develop or even use any tech platform that may remotely portray the government in a bad light.

“Look around you, people here may not be totally satisfied, but they are contented with what they have,” the developer, whom I spoke with earlier added. “They desire to have more freedom but they are happy with what they have. And even though we the developers may not be doing as many cool stuffs as they do in South Africa and Nigeria, we are still confident in the future of the ecosystem. I still believe the future of tech is bright in Ethiopia.”