Market opening delayed

The Ethiopian government began opening its telecommunications market in 2018, aiming to end the monopoly of Ethio Telecom by allowing private companies to operate and partially selling shares of the state-owned company to private investors. Despite this, the entry of a third national operator has not yet occurred, even though it was part of the original plan.

Safaricom's growth in Ethiopia

Safaricom Ethiopia, which began commercial operations in October 2022, reached its fourth anniversary in October 2026. By March 2026, the company had 13.6 million active customers, with 10.4 million using mobile data. Its mobile money service, M-Pesa, had 5.2 million users and operated through over 70,000 merchants.

Financial and network progress

Safaricom's revenue from services reached 15.9 billion birr (about 98.7 million USD) by March 2026, a 130.9% increase compared to the previous year. The company had expanded its network to 3,504 sites, covering 59% of the population with 4G. It also raised 2.6 billion USD for its operations in Ethiopia and aimed to reach operational breakeven by the end of the 2026/2027 fiscal year.

Revised development goals

Initially, Safaricom planned for a ten-year network development project costing around 8 billion USD, with a target of 10,000 to 12,000 sites in its tenth year. However, this was later adjusted to 8,000 to 10,000 sites. Similarly, its five-year investment spending forecast was reduced from 1.5 to 2 billion USD to 1 to 1.3 billion USD.

Challenges in expansion

Safaricom has faced operational and economic challenges, including security issues in certain regions that made network deployment and customer acquisition difficult. In May 2024, its then CEO noted that 500 towers were located in the Amhara region, where emergency restrictions limited access to data. Transport difficulties in Oromia also affected operations.

Economic and consumer barriers

The depreciation of the Ethiopian birr has caused exchange losses, as many of Safaricom's investment costs and supplier payments are in foreign currency. Additionally, limited smartphone access among consumers has hindered the growth of digital services, as customer numbers alone do not guarantee regular use of mobile internet.

Competitive concerns

Safaricom has raised concerns about the fairness of the competitive environment in Ethiopia. In 2024/2025, the company noted that the national Internet domain « .et » should be managed by a neutral regulatory body. A 2025 World Bank report highlighted that Ethio Telecom holds a dominant position in six market segments and offers some communications at prices below regulated costs, potentially disadvantaging Safaricom. The report also mentioned possible preferential treatment of Ethio Telecom in government mobile payments and the blocking of Safaricom apps like M-Pesa.