Early 2020 was a hopeful time for Ethiopia’s startups. Venture capitalists were increasingly eyeing Ethiopian startups, and the country improved its rank on the World Bank’s 2019 Ease of Doing Business report. Just before the start of the war, over a year back, Ethiopia was seeing a fast-growing pool of companies launching various digital services that dared to change the traditional ways of doing business.
But now, as Ethiopia is deep in a bloody one-year civil war, shifting winds have brought a completely different scene in the Ethiopian public discourse. People are making statements about where they stand in the war with simple hashtags, while no public opinion goes unnoticed. Even Ethiopia’s business moguls, entrepreneurs, and innovators who in modern history have mostly kept quiet about politics, are now part of the public discourse.
The tech community finds itself taking sides too in a war that has deeply polarized Ethiopians locally and abroad. To highlight a few examples, one tech-founder has become a prominent pro-government voice on social media, another has found a way to provide humanitarian assistance while offering innovative solutions, while another finds herself a pariah of the state for a leaked video that allegedly “reveals a conspiracy to bring down the current Abiy regime.”
Lasting a little over a year, Ethiopia’s ongoing civil war with rebels from the northern region has killed tens of thousands of people, displaced four million, and left hundreds of thousands facing famine-like conditions. Amhara regional state, one of the regions hardly hit by the war, said it would take 40 years to rebuild the region back to pre-war status.
Prime Minister Abiy Ahmed, a Nobel Peace Prize winner, is at the war front. His pleas for battle have been accepted by noteworthy figures such as Olympic gold medals. Ethiopia’s innovators, too, are taking a role and getting involved in the ways they can.
Mass mobilizations and campaigns supporting the federal government, reached fever pitch in the past weeks, after rebels from the northern region made advancements seizing new towns and pushing towards the capital, before retreating.
The war has forced people to pick sides
Solomon Kassa, a TV Personality, tech-consultant, and an important figure in Ethiopia’s innovation ecosystem, is one such player actively engaging campaigns revolving around the war.
Solomon, who recently founded 1888EC, an innovative startup studio that aspires to create disruptive innovators and change-makers in Ethiopia, has been a prominent advocate of “Pro-Ethiopian voices” on social media where both conflicting parties try to control the narrative.
Solomon nowadays uses his social media account with thousands of followers to raise awareness about pro-government campaigns and provides his analysis on the latest hot issue regarding the conflict.
Innovative humanitarian solutions
Another tech firm that is lending its hand to the cause during wartime is Chapa Financial Technologies, helping out in humanitarian causes. The fintech firm developed eyezon, a fundraising platform that allows Ethiopians worldwide to contribute to national causes.
In its first campaign to support conflict victims in Ethiopia, eyezon was able to raise 153 million birr ($3.1 million) since its launch a month ago.
Through a partnership with a local bank, which agreed to cover the whole cost of international money transfer, 100% of donations go to the causes that supporters choose to give.
“eyezon is Chapa’s contribution to Ethiopia, and supporting conflict victims is one of the major priorities highlighted by the government,” said Nael Hailemariam, general manager of Chapa, who developed the platform for free.
“We will be adding other fundraising causes on the platform soon,” Nael told Quartz.
Established last year, Chapa is close to receiving permits from the National Bank of Ethiopia (NBE) to launch its online payment systems and become one of the first firms to provide financial services outside of banks in Ethiopia.
Others have found themselves on the wrong side of the law
But not everyone’s involvement in politics has been welcomed. This is the case of Eleni Gabre-Madhin, who serves as Chief Innovation Officer at UNDP’s Regional Bureau for Africa.
Eleni made headlines first after her house in the capital was searched in what she called was ethnic profiling and harassment. But things took a turn a few days later when video of Eleni participating in a virtual meeting with western diplomats and a TPLF representative was leaked.
In the meeting where the issue of the stepping down of Abiy was discussed, Eleni raised the questions of “transitional arrangement” and “martial plan” in post-war Ethiopia to the TPLF diplomat.
Many government supporters regarded this as a conspiracy to bring down the current Abiy regime. Eleni is now regarded as a pariah by the same people that once saw her as a hero. Though Eleni said that her appearance in the meeting was widely misrepresented and that she does not endorse any transitional government, the damage was already done.
“There is no I.F.s & BUTs! Eleni crossed a red line & there is no coming back from it,” wrote Solomon on his Twitter page.
Since the leaking of the video, Eleni had her honorary doctorate from an Ethiopian university revoked. She was sacked from her position as independent economic adviser to the prime minister while her close associates and former business partners have distanced themselves from her, denouncing her actions. Her Startup incubator, blueMoon, has since been closed and is under investigation by the government.
Ethiopia’s tech sector – past, present, and future
Roll back just a few years, Ethiopia’s economic outlook told a completely different story. When Abiy came to power in 2018, he fast tracked many reforms that addressed numerous constraints stagnating Ethiopia’s digital economy.
Policy changes tackling poor network connectivity, high telecom costs, restrictive regulations, and limited funding, coupled with greater digital literacy brought in by the advancement of time, unlocked many uncharted territories for Ethiopia and its innovators.
Abiy, who himself hails from an IT background and was once the then state minister of science and technology, gave a particular focus for technology and innovation, which further boosted the sector.
The Ethiopian digital economy was said to be in liftoff. Ecosystem players described the policy environment as the “best it has ever been” while the talk of which company would be the first Ethiopian unicorn was already underway among startups and entrepreneurs.
But now, the war diverted the country’s attention and resource, and innovation seems to be on the back burner. There is a growing plea for people to join the cause and help in the ways they can.
But not all has been self-destructing since the beginning of the war. Safaricom Ethiopia, which won the bid to enter Ethiopia’s telecom market at a price of $850 million, is gearing for commercial launch despite some delays inflicted by the conflict.
Since its launch in May 2021, Telebirr, the nation’s first mobile money by a non-financial institution, has garnered around 11 million subscribers while transacting over two billion birr ($41.6 million.)
Ethiopia’s first startup act that aims to provide customized support for startups and incentivize entrepreneurship is set to be passed into law after spending over a year in the making. And according to Shega, an Addis Ababa-based digital media and research company, Ethiopian Fintech companies alone have raised more than $8.8 million in 2021 in the midst of the conflict.
Despite the uncertainties caused by the war and its massive hit on the economy, innovators remain cautiously optimistic that a post-war Ethiopia can still hold on to some of the gains that were made in the tech sector. Perhaps, their allegiance to the government or TPLF can be seen as a belief in what Ethiopia can be.
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