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Author: Digital Editor

Supreme Court Sets Bold Course Toward Digital Justice

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The Federal Supreme Court has unveiled a sweeping plan to digitise the judicial system, marking one of the most ambitious overhauls in its modern history.

Branded as “eCourt Ethiopia,” the initiative seeks to transition virtually every aspect of litigation, from filing to verdict, into a digital ecosystem by August 2026, with a pilot phase slated for September this year.

The e-justice system will initially absorb civil cases, gradually expanding to include high profile criminal cases once its cybersecurity infrastructure, developed in partnership with the Information Network Security Administration (INSA), is deemed adequate. According to people familiar with the project, exceptions will initially be made for cases involving national security or the gravest crimes.

Vice President Office Head, Judge Abebe Solomon, called the transformation “game-changing,” noting that 200 federal courtrooms will benefit and that at least one smart courtroom will be installed in each regional and district court office.

At the heart of this transition lies a profound structural redesign of court processes, supported by a hybrid approach that combines in-house reforms with interagency cooperation. The judiciary has earmarked nearly 2.2 billion Br for the three-phased transformation, positioning Ethiopia to join a small cadre of African countries with integrated digital justice systems.

The groundwork for eCourt Ethiopia was laid in 2023 with the development of a wide-area network in collaboration with the state-owned Ethio telecom, a project now reportedly 90pc complete at a cost of 1.8 billion Br. The backbone infrastructure addresses longstanding issues of connectivity, bandwidth limitations, and system resilience across federal and regional courts.

The second phase introduced automatic transcription technology, developed in collaboration with the Ethiopian Artificial Intelligence Institute (EAII), to mitigate procedural delays associated with manual note-taking. Thus far, five “smart courtrooms” are installed at the Federal Supreme Court, with an additional 10 rooms in the Federal High Courts and First Instance Court. The transcription software was delivered at 15.8 million Br, while courtroom equipment cost another 15 million Br just for the five “smart courtrooms.”

The third and ongoing phase sees INSA spearheading two central digital platforms: the Integrated Court Management Information System (ICMIS) and an Electronic Records Management System (ERMS).

Together, these systems are designed to allow judges to manage cases, issue summons, and handle documentation entirely online. Historical archives, including court records dating back over a century, are being scanned for digital preservation. Scanning at the Supreme Court is reportedly complete, with First Instance Courts underway.

Under the new system, law firms, individual attorneys, and legal service providers will be required to register through the Supreme Court’s portal or in person. Access to the complaints and litigation system requires a formal request to the Chief Registrar, and strict identity verification procedures are in place.

Litigants will submit materials through a new filing and litigation system, which enforces a 30MB total package cap (five megabytes per document), although exceptions will be made for large files. Submissions are acknowledged via SMS confirmation, and paper filings will be digitised where necessary.

Virtual hearings will adhere to the same decorum and procedural standards as in-person trials. All proceedings will be streamed in real time, though only the courts record or distribute audio-visual content. Judges may designate government service centres as access points for those lacking internet access or technological literacy.

“This initiative will speed up justice and cut down months or even years of delay,” said the Vice President.

Court records will be access-controlled, viewable only by the relevant judiciary. After the statutory retention period, records will be handed over to the National Archives & Library Agency, with redacted public versions safeguarding sensitive personal data.

Legal technology entrepreneurs and academics have lauded the initiative’s long-term potential.

According to Yeshwas Eyasu, founder of Five Square Software, reduced litigation costs and greater efficiency are achieved, citing over 12,000 documents already uploaded to his platform, “Ethiopian Legal Tech.”

“It’s a positive step,” he told Fortune. “But, it needs constant monitoring with a 24/7 specialist.”

The Vice President acknowledged that while some regional court offices and prisons already use parts of the system, wider integration is necessary.

Veteran legal advocate Belay Ketema foresees regional benefits. Lawyers in regional capitals such as Bahir Dar, Hawassa, and Dire Dawa can now avoid travel burdens. For Sisay Tamrat, dean of Wachamo University’s School of Law, the eCourt Ethiopia is a tool that enhances transparency.

“Clients often complained about misrecorded statements,” he said. “This fixes that.”

However, Sisay also warned of digital exclusion.

“If the foundation is weak, the whole system will suffer,” he said. “Connectivity lapses and digital illiteracy could leave many behind.”

Judge Abebe stated the need for a cloud-based architecture capable of sustaining large-scale court operations.

“The system in the courts is strong enough to avoid interruptions during proceedings,” he told Fortune.

The final legal framework, which will govern eCourt Ethiopia, is expected to be finalised within a month. However, experts say that whether a successful pilot phase can scale into a nationwide legal revolution remains to be seen.

“We’re not only building a platform, we’re building a justice ecosystem,” Judge Abebe told Fortune.

 

Nib Bank Sues Former Directors, Executives

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In an unprecedented legal manoeuvre, the management of Nib International Bank (NIB) has filed a sweeping civil lawsuit against 30 of its former board members, senior executives, and audit officials.

The charges, filed at the Federal High Court, civil bench, accuse the defendants of gross mismanagement, regulatory breaches, and self-dealing that allegedly resulted in hundreds of millions of Birr in losses and eroded shareholders’ confidence in the Bank.

Incorporated in 1999 with 27.6 million Br in paid-up capital, Nib Bank has expanded its shareholders base to 5,900 and grown to amass over 65 billion Br in assets. It operates more than 420 branches across the country.

At the centre of the complaint are high-profile figures, including former Board Chairman Woldetensay Woldegiorgis, ex-President Genene Ruga, and Alemayehu Gurmu (PhD), an economist by training. Another defendant, Melaku Woldemariam, currently serves as a commissioner on the Ethiopian National Dialogue Commission.

Officials removed by the Bank’s General Assembly between 2022 and 2023 are at the centre of the lawsuit, which appeals to the court to hold them jointly and individually liable for the 507 million Br in claimed damages.

Lawyers representing Nib Bank, Sintayehu Zeleke & Associates, claim a pattern of alleged infractions that span from September 2021 through early 2024. They allege that the defendants undermined the Bank’s liquidity position, ignored warnings, and operated in violation of explicit directives from the National Bank of Ethiopia (NBE).

Notable among the charges is the approval of over five billion Birr in loans, despite a formal NBE directive in 2023 suspending new lending to protect liquidity buffers.

Former Board Chairman Woldetensay is accused not only of breaching that directive, but of directly benefiting from it through Awdas Trading Plc, a company under his control. The complaint alleges he further awarded promotional contracts to Balageru Multimedia, a company in which he held shares, in alleged non-transparent deals that bypassed competitive procurement processes.

The misconduct, according to the Bank’s filing made on May 8, 2025, was not isolated to lending.

Former President Genene, who led the Bank’s foreign exchange allocation committee, allegedly used his position to procure hard currency permits for himself and his associates, while delaying NIB’s obligations abroad and incurring penalties. Mulugeta Dilnesaw, the former director of risk and compliance, is accused of ignoring liquidity red flags and approving loans to executives and their relatives.

Internal control failures appear equally central to the case filed by Nib Bank’s lawyers. They allege manipulation of financial reports, which the Bank claims led to flawed tax payments and obscured the proper financial health of the financial institution. An audit report cited by Nib Bank claims inconsistencies between declared earnings and actual deposit income, resulting in 25 million Br in overpaid taxes. Former external auditor Tewodros Fikre is accused of having overlooked serious breaches, including unauthorised foreign exchange allocations and non-compliance with lending policy.

Beyond internal governance lapses, Nib Bank attributed regulatory fines, amounting to over 132 million Br, to the defendants’ decisions. These include alleged missed reserve requirements, delayed treasury bond purchases, and failure to settle Real Time Gross Settlement (RTGS) payments. The lawsuit claims additional penalties for foreign exchange planning errors and unpaid loans from the NBE, totalling over 40 million Br. Compounding the damage, tax miscalculations allegedly cost the Bank another 305 million birr.

The Bank’s management now seeks to recover not only damages, but also nine percent annual interest from the date of the lawsuit’s filing.

What Happens Next to Globalization?

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Despite the handwringing about US President Donald Trump’s tariff war, which many claim sounds the death knell for the world’s trading system, and worries about heightened geopolitical tensions, globalisation is not ending. But it is being fundamentally restructured by geopolitical shifts, technological transformation, and climate change. And each of these forces will affect globalisation in different ways.

For starters, the rise of China and other economies is bringing an end to the postwar world order dominated by the United States (US). Escalating strategic rivalries, coupled with populist politics, have ushered in an era of economic nationalism, upending old paradigms and fueling trade tensions. Economies that once preached the neoliberal gospel of free markets and openness have now adopted nationalist industrial policies, protectionism, and discriminatory trade practices. This shift is most apparent in the US, formerly the chief exponent of neoliberalism and the de facto guarantor of the multilateral system.

These evolving geopolitics, particularly the US-China rivalry, but also the proliferation of armed conflicts, will reshape, not reverse, globalisation. Today’s tariff war is motivated not so much by isolationism as by mercantilism, a power play to gain economic advantage. With international trade amounting to nearly 60pc of global GDP (and external financial assets and liabilities equivalent to around 400pc), the world economy has become highly interdependent, suggesting that global integration is here to stay.

China and the US still depend on international markets – and each other – to sustain their economic success. While a strategic decoupling of the Chinese and US economies will undoubtedly take place in advanced technology and other critical sectors, a broader rupture is not in the cards.

The most likely outcome is fragmented globalisation, with economic connections reconfigured around competing powers and along regional lines. Trade geometry will become increasingly variable as groups of countries and sectors become more integrated, and others less so. This fracturing will inevitably impose costs on everyone. But not all reorganisation of supply chains will be driven by geopolitical power plays. Some will result from efforts to diversify and enhance resilience, especially as emerging economies offer new sources of supply.

The developing world’s economic rise and greater integration into the world economy may do more to shape global supply chains in the long term than the current geopolitical shifts. At the same time, the digital revolution, including AI, is remaking global labour and financial markets, business models, and production and delivery processes. These technologies constitute a counterweight to geopolitical tensions and will be a fillip to globalisation because they enhance the connectivity that underpins the cross-border flow of goods, finance, and knowledge, and they facilitate labour-market integration.

Digital technologies are already changing the structure of globalisation by expanding trade beyond physical goods. In recent years, cross-border data flows have been increasing by as much as 50pc annually. Whereas international integration has been driven by labour-cost arbitrage in manufacturing, with global companies taking advantage of low-wage workers in emerging economies, now digitally deliverable services, particularly business-to-business services, will maintain and strengthen these ties.

As technology re-localises some manufacturing, it will de-localise services, heralding an increasingly “weightless globalisation.”

Global warming will also affect patterns of production, trade, and investment. To reduce their carbon footprints, companies will reconfigure supply chains. Trade in environmental goods and services, as well as cross-border investment in green technologies, will expand. Combating climate change confronts humanity with huge challenges, but it also opens new avenues for global growth and creates new opportunities for international commerce and finance.

And precisely because climate change is a universal problem, it can increase interconnectedness and elevate the provision of global public goods on the international agenda. Even as geopolitical rivalries deepen, the threat of mutual assured destruction from climate inaction can motivate adversaries to cooperate. This may have positive spillovers for international collaboration in areas that are more susceptible to zero-sum thinking, such as trade.

The real risks to globalisation are not from geopolitical rivalries, technological disruption, or climate change, but rather from policy responses to them. Countries should do a better job of managing the necessary restructuring of their economies, especially when it comes to addressing distributional consequences. At the international level, new trade, technology and climate rules will become increasingly important in the coming years. But international organisations should recognise that national approaches will differ and adapt governance accordingly.

 

As economies evolve and geopolitical power shifts, new competitive dynamics will inevitably emerge. The extent to which policymakers agree on and adhere to a core set of global rules will determine how much turmoil and uncertainty this process brings.

Bureau Modernises Urban Land Access Systems

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Addis Abeba’s Land Development & Management Bureau disclosed issuing 40,156 digital landholding certificates in the current fiscal year. Of these, over 18,104 were granted to farmers and their heirs in a move to resolve long-standing land claims. The Bureau mentioned that transitioning from paper-based to tech-enabled services has significantly improved delivery, aided by regular field support to sub-city offices. Additionally, 38 farmers’ agricultural projects were assessed and cleared for development through lease agreements. Officials say these efforts aim to address governance and accountability gaps in land management, while the Bureau presented its 2018 indicator plan with stakeholder input.

Tightening the Noose on Private Schools. At What Cost?

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A heated debate is unfolding about the role and impact of private schools, especially in Addis Abeba, ignited by recent comments from the Minister of Education, Birhanu Nega (Prof.), during a prime time TV program. The Minister raised concerns that private schools prioritise profit over education, suggesting that countries cannot develop their education systems effectively through fee-charging schools.

However, international evidence from several successful education systems challenges his viewpoint.

Countries such as South Korea, Australia, New Zealand, India, the United Arab Emirates (UAE), the United Kingdom (UK), and the United States (US) have private school sectors that contribute substantially to their education systems. According to OECD data from January 2024, approximately 44 million students, representing 18pc of all students in OECD countries, attend private institutions.

At the upper secondary level, private school enrollment exceeds 40pc in Australia, Belgium, Chile, South Korea, and the UK. Notably, in Ireland and New Zealand, nearly all pre-primary education is provided by private institutions.

Despite this, the Minister urged middle- and high-income families to enrol their children in public schools to support systemic change. However, his proposal overlooks key reasons why families opt for private education despite the availability of free public alternatives. He also failed to provide specific statistics on enrollment in private schools, limiting the clarity of his concerns. The national student population exceeds 30 million, yet private school enrollment remains small.

Birhanu cited Finland’s education model as his blueprint for reforms, though critics argue it lacks relevance to Ethiopia’s context. Among the 27 European Union (EU) countries, 16 operate government-funded private schools.

Data from OIDEL, a.k.a the International Organisation for the Right to Education & Freedom of Education, revealed that 81pc of European countries financially support non-governmental schools: 10pc subsidise teacher salaries, 33pc cover operational costs, and 17pc provide almost full educational funding. Countries like Ireland, the Netherlands, Belgium, Malta, Denmark, the UK, Slovakia, and Finland notably support private education.

The Minister’s aversion to private schools may stem from his long-held ideological positions, as well as sincere concerns about equity and social justice. Indeed, private schools offer distinct advantages, resulting in superior academic performance and better career opportunities, raising valid equity concerns. However, blaming private institutions ignores the systemic issues within public schools, where most students are educated.

Ethiopia’s public education system faces profound challenges, impacting student achievement. For instance, “learning poverty,” defined by the World Bank and UNESCO as the inability of children to read and comprehend age-appropriate texts by age 10, has reached alarming rates of approximately 90pc.

In the two academic years beginning in 2022, over 95pc of grade 12 students who took national exams failed to score the minimum passing grade of 50pc, exposing severe deficiencies that extend to higher education institutions. Colleges and universities are producing graduates who lack essential literacy and numeracy skills, thereby undermining the quality of the workforce.

Private schools have rapidly expanded, particularly in Addis Abeba, in response to the demand for better educational quality. The Addis Abeba Bureau of Education reported that 585,000 students, 46pc of the city’s student population, attend 1,640 private schools, which constitute 74pc of all schools in the city.

Kindergartens alone number 935, accounting for 57pc of private schools in compact urban properties. Compared to public primary schools, 235 private primary schools educate around 384,000 students, while 554 private primary schools teach approximately 312,000 students. At the secondary level, 85 public schools cater to approximately 145,000 students, while 151 private secondary schools enrol around 79,000 students.

Although numerous in Addis Abeba, private schools represent only about five percent of the 40,000 educational institutions across the country, serving a relatively small fraction of the total student population.

Given this context, focusing blame on private schools distracts from addressing fundamental issues within the broader public education system. Policymakers are urged to confront structural problems directly, rather than targeting private institutions that serve only a minor portion of the population. There appears to be a potential conflict of interest, as many public officials, including those who regulate private schools, enrol their own children in these institutions.

Private schools in Addis Abeba consistently outperform public schools academically, as demonstrated in regional and national exams. Driven by competition, these institutions continuously invest in superior facilities, educational resources, and qualified staff. They emphasise rigorous instructional leadership, disciplined environments, and strong parent-school partnerships.

Despite their contributions, private schools often face harsh criticism rather than recognition for their role in educational advancement.

Contrary to perceptions of inadequate regulation, private schools operate under stringent oversight from the Addis Abeba Education & Training Quality Regulatory Authority. This agency meticulously monitors curriculum adherence, staff qualifications, class sizes, campus infrastructure, and even furniture specifications—any deviations risk license revocation.

Notably, supplementary enrichment activities in mathematics, science, and English designed to boost international competitiveness are banned, prompting private school operators to voice frustration over perceived restrictions on their autonomy.

Private schools uniquely face tuition fee caps, regulated under the newly approved Education Law. Tuition adjustments are permitted only once every three years, subject to parental approval, a highly unusual business model giving customers direct price-setting power. Such restrictive pricing policies undermine schools’ financial stability, especially in an economy marked by persistently high inflation.

These regulatory pressures threaten the sustainability of private schools, forcing them to implement cost-cutting measures that compromise educational quality. Underfunding undermines facility upgrades and the procurement of educational materials, while inadequate salaries drive skilled teachers and administrators to better-paying sectors.

The resulting erosion of quality could diminish distinctions between private and public institutions, potentially leaving families with no viable alternatives.

Rather than restricting private schools, policymakers should prioritise enhancing the quality of education provided by the public school system. Improved public schools would offer financially strained families better educational options, thereby alleviating the impact on household budgets caused by rising inflation. Addressing these systemic issues in public education would benefit the majority of students nationally.

Another concern that demands policymakers’ attention is the growing scepticism among young people about the value of education. Observing highly educated professionals, such as medical doctors, struggling financially while less skilled individuals prosper discourages students, eroding their motivation and purpose. Such disillusionment creates tension and dysfunction within educational environments, exacerbating existing problems.

Thus, restoring confidence in education as a pathway to success is critical for Ethiopia’s future workforce and social stability.

Ultimately, private schools, despite their contributions, risk declining under restrictive regulations and persistent criticism from public officials and the media. Few new private institutions have emerged recently due to formidable barriers to entry. Analysts predict that major closures among private schools will occur once the current three-year tuition freeze ends, potentially weakening the education sector as a whole.

This scenario would neither improve public schools nor promote genuine equity; instead, it would merely lower educational standards across the board.

Rather than scapegoating private schools, policymakers should address the fundamental issues plaguing public education directly. Only by addressing systemic problems head-on can Ethiopia hope to improve educational equity and quality, benefiting all students and strengthening national social cohesion and economic prospects.

Addis Abeba’s Concrete Promises Face Hard Costs in Urban Overhaul

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On a chilly Addis Abeba morning, Ginfile, the dense quarter otherwise known as “5Kilo,” wakes to the hiss of charcoal stoves and the smell of buna. Neighbours swap greetings across courtyards that double as kitchens and workshops. Children weave through alleys, ducking laundry lines and vendors’ trays.

A few blocks away, BalchaWoldeChilot Condominium in the “4Kilo” area greets the same dawn with doors opening onto quiet hallways. Wide stairwells are spotless, the units selfcontained, and the hush still underlines a muted kind of progress. These are areas that remind us that the contemporary African metropolis is constantly evolving with bulldozers and blueprints. Some cities are divided by rivers, while others are divided by highways.

However, in the march toward modernisation, well-meaning initiatives split towns not by class or creed, but by two ways of life. One is cast in poured concrete and plumbing, the other held together by shared injera and whispered favours.

Official promises arrive in smooth language, where thousands of new units, hardhat jobs, upgraded pipes and pavements. Then demolition rattles quarters labelled “slums” only by outsiders. At the end come mid-rise blocks with elevators, latrines, and, in theory, a mortgage. The path from shack to showroom, though, winds through unintended consequences, including lost income, fractured kin networks, and a gnawing sense of exile.

The Integrated Housing Development Program, launched in 2005, targeted 400,000 condominium units, 200,000 construction jobs and a 50pc cut in slum coverage. By the time the cranes slowed, more than 300,000 units stood, and over half a million jobs had been tallied. These are numbers any minister would cheer. Yet Addis Abeba paid a hidden price.

In the six years beginning in 2009, crews scraped away 392hct of innercity fabric, winding passageways, corrugated iron homes and shaded porches where coffee vendors served pensioners and students. Time there ran on conversation, not contracts. Rough as the quarters looked, they followed unwritten codes. Nearly 23,000 households were uprooted, each woven into a network richer than any infrastructure ledger could reveal.

Space itself was an economic engine where public and private blurred. A doorway became a storefront, and a courtyard, a workshop for injera or laundry. Nearly half of the residents earned income from informal trade, and more than 80pc did so within walking distance. Gross domestic product (GDP) never recorded the value of such social capital, but the urban poor relied on it every day.

Standing at the courtyard gate, an elderly resident recalled how a single shout once summoned neighbours to lift a sick child, fix a roof, or lend the day’s sugar. These were tiny transactions of trust that cannot be loaded onto a moving truck after the bulldozer has passed.

Planners, fixated on “exchange value,” tracked square meters, market price and skyline aesthetics. Housing theorist JohnF.C.Turner warned that a dwelling’s real worth rests in its “use value,” what it does for occupants. The tinroofed units razed by IHDP were more than shabby shelters. They generated income, provided childcare and stored the city’s social energy. Uniform blocks with uniform rules drained that value.

Granted, condominium life brought undeniable hardware upgrades, including running water, private toilets, and sturdy walls. Still, the new blocks often sat on the capital’s rim, approximately 15Km from former homes. Jobs vanished or lengthened into costly commutes. Tailoring shops, teff grinders and kiosks struggled to restart. Some families endured multiple relocations as later projects steamrolled the sites meant to be permanent.

This blind spot, where hardware takes precedence over human software, persists in renewal strategies from Lagos to Nairobi. Engineers sign off on pipes and lifts; sociologists arrive later to map the rubble of relationships. Policy papers list latrines per floor, not livelihoods per block. In Addis Abeba, the gap yawns widest for women who had run homebased enterprises, and for children who lost the safety of many watchful adults. Alienation, scholars say, is harder to fix than plumbing.

Paper results still glittered. By 2014, deliveries had surpassed 170,000 units, and officials proclaimed that the slum footprint had been halved. Followup surveys painted another picture. Incomes fell, transport bills climbed, and promised utilities lagged behind occupancy. Infrastructure arrived without a pulse.

Old neighbourhoods thrived on informal safety nets. Where banks did not, “Idir” and “iqub” groups offered insurance, savings and credit. Children walked to school, watched by many eyes. Meals crossed thresholds with ease. Development scholar Caroline Moser’s vulnerability framework reminds us that intangible assets, such as social ties, local knowledge, and trust, can outweigh concrete ones. In innercity Addis Abeba, they were abundant until bulldozers treated them as debris.

The loss of this grit is almost never priced. Planners count hectares cleared, but not grandmothers who watched the alley. They value reinforced concrete but not the whispered favour that found a first job. By chasing measurable outputs, policy swapped poverty relief for slum removal, conjuring new hardship.

No one argues against better housing. Few would mourn the exit of leaking tin roofs or unpaved walkways that doubled as open drains. But ‘better’ should mean more than mere concrete. Better should be responsive, participatory, and adaptable. The IHDP succeeded in building houses. It failed in building homes.

Cities cannot afford to chase visibility for another decade at the expense of viability. Incremental in-situ upgrades, serviced land plots, and credit for self-builds would stretch public funds and preserve social cohesion. Development should embrace what one planner called “the disorder that shelters dignity” instead of erasing it. Redevelopment should not stop; it should start differently. Begin with what works.

How do homes sustain life as it is, not only as planners hope?

Mixed-use, mixed-income designs and incremental upgrades can transform top-down orders into bottom-up evolution. Residents should be considered not merely as recipients but as experts of their streets. A city’s greatness will be judged less by tower heights than by how well it held its people together when the scaffolding was gone.

In Taxing Aggressively, Fed’s Fiscal Reckoning Arrives

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Parliament is no stranger to frantic bursts of productivity. Even so, the vote last week on a new income tax law was dizzyingly swift. Only five legislators dissented before the bill was rubber-stamped. Authors of the bill, whose undeterred position was thundered in the legislative chamber by Eyob Tekalegn (PhD), state minister for Finance, hailed the passing of the bill that revised the income tax law after 17 years.

No less, it is an instrument to scrape “every penny” from taxpayers and plug an ever-widening deficit.

The federal fiscal gap, including grants, reached two percent of GDP in the fiscal year that ended in July 2024 and shows scant signs of narrowing. Revenue has slumped from 8.1pc of GDP in 2021/22 to 7.3pc in the subsequent year, barely half the sub-Saharan African average. Officials promise a bounce to 10.2pc by 2025/26 and 11pc two years later. Such ambition belies years of frustration. Despite growth averaging roughly seven per cent annually for two decades, the tax take has stayed stubbornly low.

Direct taxes on personal and corporate income have flagged since 2019. Consumption levies, notably VAT and excise duties, also underperform, seen as a sign of pervasive informality and rampant evasion. Trade taxes have withered from six percent of GDP to a meagre 1.5pc, largely because import volumes have shrunk. Customs duties and import VAT, though, remain a modest bright spot, a result of recent administrative tightening.

Geographic disparities compound the malaise. Addis Abeba, home to barely four percent of the population, provides more than a quarter of federal revenue. Peripheral regional states collect less than five percent of what they spend, relying on block grants that have already slipped from 65pc of general expenditure to 45pc.

Spending pressures, by contrast, are relentless. Recurrent costs balloon as the public payroll swells, while capital budgets often go unspent, crimping future productivity, and, thus, future tax capacity. Loss-making state-owned enterprises add to the burden, drawing on government guarantees to cover debts. Confronted by a narrow tax base, administrative frailties and shrinking foreign finance, federal officials have opted for a bolder hunt for cash.

The new law widens the base, trims exemptions and ratchets up rates for high earners. Its centrepiece is a minimum tax regime. Businesses should now pay at least two percent of their turnover, regardless of whether they are profitable or not. The Finance Ministry attributes this to 67pc of businesses routinely declaring losses; hence the floor. Taxpayers whose annual income tops one million Birr face a jump in their top marginal rate from 35pc to 40pc. Multinationals and well-heeled individuals suspected of shifting profits abroad are promised sterner scrutiny.

Whether these measures will work is another matter. Inflation, running at 14.1pc in May 2025, coupled with Birr’s loss of ground against a basket of major currencies, erodes real incomes and trust. Credit to the private sector has shrunk by nearly 12pc after the IMF barred direct central bank financing of the budget. Liquidity is tight, making it harder for firms to pay higher bills on time. In an economy where about 80pc of workers toil informally, the temptation to duck into the shadows is strong.

Further tax hikes, critics warn, may drive even compliant businesses underground, widening rather than narrowing the gap.

External buffers remain brittle. Net foreign direct investment has petered out, falling to 3.2pc of GDP, down from five percent in 2017. The current account deficit, stuck near 2.9pc of GDP, keeps pressure on the Birr. The Central Bank’s hard-won reserves, projected at 1.7 months of imports by June 2025, are still perilously thin. High public debt, 34.8pc of GDP, even before hoped-for relief, is eating into the federal government’s room for manoeuvre.

Officials tout the benefits of “aggressive” taxation, yet investors fret that a heavier burden on the formal private sector could hobble the very engine of growth and job creation. Small and medium-sized enterprises, which account for half of formal employment, are bracing for a blizzard of paperwork now that the Ethiopian Revenues & Customs Authority enjoys beefed-up audit powers.

Relying heavily on income and consumption taxes carries other risks. Levies on spending can sap demand in an inflationary climate; steeper rates may also deter formalisation, especially when public services are patchy. The federal government forgoes tens of billions of Birr a year in exemptions, according to the Finance Ministry. Evidence, say critics, of a system simultaneously too lax and too heavy-handed. Real reform, they argue, requires more than squeezing the same lemons harder.

Technocrats inside and outside government offer a fuller menu.

Digital filing and risk-based audits, modelled on Rwanda’s electronic-billing triumph, could enhance compliance without requiring inspectors to visit every shopfront. Mandatory e-invoicing and a consolidated business registry would make it more difficult to remain invisible. Presumptive taxes and simplified regimes for micro-enterprises, paired with access to credit and social protection, could encourage informal operators to come out of the shadows. Targeted excise duties on luxury or environmentally harmful imports could raise cash without throttling productive investment. Natural resource royalties, particularly from mining and geothermal projects, remain largely untapped.

For now, policymakers’ strategy leans on compulsion. Officials will chase paperwork, cross-check invoices, and threaten audits. Over time, they will be compelled to court consent. Streamlining business registration, offering tax credits tied to formal employment, and digitising services could sweeten compliance. Better public accounting, timely audits of spending ministries and transparent procurement would reassure sceptical taxpayers that money is not vanishing into black holes. A credible medium-term fiscal framework, spelling out how today’s pain translates into tomorrow’s roads, clinics, and jobs, would be helpful.

The political economy of tax is as important as the economics. In a country where state legitimacy is contested and security concerns persist, taxation serves as a barometer of trust. Citizens part with cash more readily when they perceive value in return. Yet, many see threadbare schools, infrequent water supplies and erratic electricity. Without tangible improvements in public services, higher taxes may deepen resentment.

Policymakers also tread a fine line with donors. The IMF urges discipline, but knows all too well that excessive austerity risks suffocating growth. Development partners want domestic resource mobilisation but fear social backlash if the burden falls on the poor. Balancing these demands will test the finesse of Prime Minister Abiy Ahmed’s (PhD) administration.

Under-collection breeds underinvestment, which depresses productivity and keeps revenues low, creating a vicious circle that it can ill afford. An assertive tax law is only a first step. The next should be a modern administration, calibrated incentives, and above all, a social compact that links taxes to visible benefits. This will determine whether the administration escapes its fiscal bind or simply rearranges the numbers.

 

When Being Seen Means Being Taxed

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A few months ago, at a café near the Bole Medhanialem neighbourhood, a civil servant made a statement that has resurfaced as Parliament revises the federal tax rules. Between sips of tea, he said to me, “We are taxed not because we are rich, but because we are visible.”

He was not complaining; he was describing how the system feels to those on payrolls that the state can easily reach.

That remark echoes louder after Parliament ratified on July 17, 2025, what officials bill as a sweeping modernisation of the income tax law. The last major reset of personal income tax thresholds was in 2008, when a litre of benzene cost less than 10 Br and TikTok was not yet a thing. By that yardstick alone, change is overdue.

The law widens the net. It pulls in the digital economy, requires electronic reporting for a range of income sources, and imposes a minimum tax on gross revenue even when a business incurs a loss. The top taxable personal rate of 35pc will now apply at 14,000 Br a month instead of 10,900. The tax-free threshold rises to 2,000 Br from 600. On paper, many workers move to lighter brackets.

On the ground, the reception has been mixed. Labour unions, civil society groups and private sector voices, some normally quiet on fiscal policy, have pushed back. Their quarrel is less with the idea of taxation than with its distribution, timing and return. That the state needs revenue is no point of contention. It is emerging from conflict, carrying rising debt obligations and coping with a depreciating currency. However, taxpayers ask who pays, how much, when, and what they get.

Inflation has eroded paychecks; salaries have not kept pace. Living costs climbed while expectations for public services remain modest or unmet. In that climate, reform can feel less like shared citizenship and more like another deduction that falls hardest on formal sector employees, the people who, like the person I met at Bole Medhanialem, are most visible to the taxman.

Business apprehension centres on the minimum tax on gross income. The measure may have targeted a blunt avoidance by firms that chronically report losses. But, it can also catch companies in their investment phase, when cash flows run negative by design. Safaricom Ethiopia, which has poured capital into building out a telecom network and remains in the red, has already called the flat minimum tax “punitive.” It may have a point. Taxing topline revenue before profits materialise risks crimping growth.

Another frontier is the digital economy. For the first time, content creators, including YouTubers, TikTok influencers, and online consultants, will be required to register and pay. Fair enough if everyone contributes. The open question remains the capacity for compliance.

Can revenue authorities identify, assess and collect without sowing confusion or nudging young entrepreneurs off the books and back into informality?

Taxation rests on a social contract. Citizens pay, the state delivers services, applies rules fairly and earns trust. For many Ethiopians, the contract is frayed. They pay because they must, not because they believe the system works in their favour. When roads crumble, hospitals run short of supplies or public housing projects stall, people wonder where their money goes.

The Ministry of Finance defends the overhaul as part of a broader push to meet fiscal targets and shrink the federal government’s notorious tax gap. The country’s tax-to-GDP ratio ranks among the lowest in the world. Under the G20 Common Framework for debt treatment, federal authorities have pledged to improve domestic revenue while restructuring external obligations. Undoubtedly, pressure to reform is real. So is the risk of fatigue.

When the tax net widens without a visible payoff in services or fairness, compliance can slip into quiet defiance. Workers and firms shift income off the books, underreport earnings or devise new shelters. The government could push harder yet collect less. Execution will decide the outcome. Progressive taxation needs more than rate tables; it needs empathy backed by enforcement that targets evasion without penalising compliance. Safeguards for vulnerable groups, such as people with disabilities and low-wage workers, should not be an afterthought. They must be embedded early.

Finance officials say they have commissioned a study on the living conditions of civil servants. Good. But studies do not pay rent or buy groceries. The public will judge the law by what shows up in take-home pay and classrooms, clinics and roads, not in binders. Taxpayers will inevitably weigh the revised tax bill in personal terms.

Does the law leave them with more dignity or more despair?

That question will shape compliance as surely as any audit schedule. Ethiopia’s experience has long shown that visibility, not wealth, determines who bears the load; unless reforms broaden capacity to reach the hardest-to-see parts of the economy while improving services, the burden will stay uneven. My friend at the café may have been right to worry.

Fortress Europe’s African Victims

Posted on by Digital Editor

Europeans may be horrified by US President Donald Trump’s draconian immigration policies, which include snatching people off the streets and deporting them without due process.

But the European Union’s (EU) decade-long crackdown on irregular African migrants who, fleeing conflict, climate disasters, and poverty, attempt to reach Europe by sea in flimsy boats is equally appalling. Worse, the European Commission seeks to double down on this approach: a leaked proposal for the next long-term budget cycle calls for conditioning development aid for African countries on meeting migration-reduction targets.

Africans comprise a fairly large share of the EU’s irregular migrants, with West and Central African countries accounting for around one-third of those arriving in the first half of 2024. At least 11 million African-born migrants reside in Europe, more than double the number living in Asia and North America, where they boost the labour force and ease the economic pressures caused by a rapidly aging local population.

But many Europeans treat irregular migrants as a security threat, criminalising their entry and scapegoating them for broader societal problems. After millions of Syrian, Afghan, and Iraqi refugees fled to the bloc in 2015-16, the EU began strengthening “Fortress Europe.” Some countries, including Greece, Hungary, Poland, and Slovenia, have built external border fences, while others, such as Germany and the Netherlands, have reintroduced border controls.

Efforts to secure the bloc have included violent pushbacks against refugees and migrants at external borders, a violation of international human-rights law, and partnerships with third countries to curb flows. According to Amnesty International, the EU’s externalisation policy, coupled with Italy and Malta’s hostility to rescue ships, was responsible for 721 migrant deaths in the Mediterranean between June and July 2018. More recently, several European rescue organisations blamed the deaths of 3,000 people in the Mediterranean in 2023 partly on an EU decree enacted that year that severely restricted their response capacity.

There is a stark divide between how European and African governments view this issue. From Sweden and Poland to Italy and Germany, far-right populist parties have surged in popularity by stoking anti-immigrant sentiment, which has pushed many mainstream European politicians to embrace xenophobic policies.

By contrast, African governments largely oppose the EU’s forced return of migrants, for both humanitarian and economic reasons. African migrants are a vital source of remittances, sending back 100 billion dollars in 2022, more than the continent received in official development assistance and foreign direct investment combined. These governments are also quick to note that they bear the brunt of African migration. Of the more than 45 million people forcibly displaced in Africa last year, 34.5 million remained within their own countries.

Of course, this does not absolve African governments of responsibility for their actions: poor governance, political exclusion, and development failures have contributed to the migration surge. The lack of economic opportunities, in particular, has forced many young Africans – the continent has the world’s youngest population, with 70pc in sub-Saharan Africa under the age of 30 – to flee to wealthier countries.

But, instead of using its economic might to bolster growth and support job creation in Africa, the EU poured 585 million dollars into its 2016 Migration Partnership Framework, a new way of engaging with source countries to reduce migration. The resulting partnerships with Ethiopia, Mali, Niger, Nigeria, and Senegal subordinated development aid to migration goals. This heavy-handed approach, particularly the EU’s obsession with negotiating the forced return of African migrants and pushing its own interests, failed to stem the flow of people, alienated African governments, and undermined the bloc’s human-rights and development principles. Now, the Commission has its sights on hardening this negative-incentive structure and applying it more widely.

To be sure, overall migrant arrivals in the EU declined by about 20pc in the first five months of 2025. But this decline came after years of human-rights abuses by the EU’s third-country partners, which were effectively bribed to slow the movement of people. In 2024, the European Court of Auditors criticised the bloc’s five billion euro Emergency Trust Fund for Africa for failing to address the human-rights risks involved in subcontracting migration policy to autocratic regimes in Tunisia, Egypt, and Libya. That same year, more than 2,000 African migrants died while trying to reach Europe.

The behaviour of these regimes is reprehensible. The Libyan coast guard has subjected African migrants to “unimaginable horrors” like sexual violence, torture, arbitrary detention, beatings, and enslavement. Tunisia’s security forces have raped women, beaten children, dumped others in the desert, and reportedly colluded with smugglers. Last year, a leaked internal report from the European External Action Service warned that continued support for Tunisia, which has cracked down hard on dissent, would damage the EU’s reputation.

The cruelty on display within the bloc is no less shocking. Frontex, the EU’s border control agency, was reportedly involved in covering up hundreds of illegal pushbacks in the Aegean Sea. Polish border guards forced migrants back into Belarus, where they were beaten and raped. Last year, three Egyptian teenagers froze to death after Bulgarian officers reportedly obstructed their rescue near the Turkish border. Many Sudanese asylum seekers continue to be held illegally in Greek prisons.

The EU’s current approach is ineffective and inhumane; its proposal to use foreign aid as a stick is even more so.

To address the source of African migration, European policymakers should understand why young people embark on this perilous journey. A 2019 report by the United Nations Development Programme (UNDP), based on interviews with 1,970 African migrants from 39 countries, conducted across 13 EU member states, found that they were typically educated above the average levels in their home countries and had held steady jobs there. But only 38pc said they had earned enough “to get by.” Unable to fulfil their ambitions in Africa, and with many facing war and repression, these young people looked to Europe for opportunity and safety.

Reducing migration from Africa requires contributing generously to its development, not funding third countries, many of them ruled by repressive regimes, to harden borders by any means. The EU has cynically chosen the latter approach, eroding its moral standing. If the bloc wants to portray itself as a global force for good following America’s retreat from the world stage, it should pursue migration policies that reflect our shared humanity, rather than self-interest.

The Invisible Bias Against Caring Fathers

Posted on by Digital Editor

Last week, I was in the hospital, sick and out of commission. While I focused on recovery, my husband Mike took over without hesitation. He cared for our daughter completely. No fanfare. No applause. Just a father doing what he always does: parenting.

But what unfolded outside our home revealed something unsettling. As Mike took our daughter to parks, grocery stores, and on walks, he met a strange mix of praise, scepticism, and judgment. Some admired his “hands-on” approach, but their surprise suggested it was unusual. Others criticised him outright, questioning how he held her, fed her, or gave her water.

The inevitable question came: “Where is her mommy?”

These were not rare occurrences. They were constant. Only when people noticed how happily our daughter responded to Mike did the criticism ease. Some even apologised, but by then the damage was done.

That question – “Where is her mummy?” – echoes a deep bias: that mothers are the default, and fathers are just stand-ins. This same thinking shows up in practical ways too. Diaper-changing tables are often located in women’s bathrooms, excluding fathers from the caregiving equation.

Mike frequently finds himself in awkward situations when trying to change our daughter’s diaper in public. Sometimes, the only option is to enter the women’s restroom, which is uncomfortable and inappropriate. It is not just inconvenient, it is unfair. Fathers who actively parent deserve spaces designed for them too.

The truth is, fathers today are doing more than ever. They attend school meetings, change nappies, pack lunches, braid hair, and soothe nightmares. Yet the perception that fathers are somehow “second fiddle” lingers. When a father nurtures, people act surprised, as though love and competence do not belong to him.

This perception is not just outdated, it is damaging. It places unrealistic pressure on mothers while discounting the love and labour of devoted fathers. Worse, it teaches children that caregiving is gendered, tied to biology instead of love and responsibility.

But many fathers today are reshaping that narrative. They do not want to be part-time parents or distant providers. They want presence, emotional connection, and deep bonds with their children.

Still, they face scrutiny.

When mothers walk with their children, no one questions them. But when fathers do the same, especially alone, they become spectacles. People comment. Some even intervene. If the child cries, strangers assume he is clueless. If his method differs from a mother’s, it is called incompetence, rather than just a different approach.

This bias shows up in countless ways. Fathers are praised simply for being with their kids, as if they are babysitting. Parenting products and services overwhelmingly target mothers. Hospitals direct communication towards mums, and schools call them first. Even the language we use – “maternal instincts,” “motherly love” – implies that care is inherently feminine.

But what about paternal instincts? They exist. They matter.

Children with emotionally present fathers tend to thrive. Studies show they do better in school, build stronger relationships, and develop resilience. Fathers offer distinct, vital forms of support, yet society often diminishes their contributions or treats them as extras.

This bias does not just harm fathers. It overburdens mothers. When society assumes mums are naturally better at caregiving, it sets impossible standards. It makes it harder for them to rest, recover, work, or simply breathe without guilt. It places all responsibility on one set of shoulders while underestimating and sidelining the other.

When people question a father’s ability to feed or soothe his child, they do not just doubt him. They are reinforcing a world where caregiving is “women’s work.” And when they ask, “Where is her mummy?” they suggest a father alone isn’t enough.

Thankfully, change is happening.

Younger generations are challenging these outdated ideas. More men are taking paternity leave where it exists, and pushing for it where it doesn’t. Families are sharing parenting duties with mutual respect, not tradition. Communities of fathers are forming, where men support one another and take pride in their roles as parents.

Still, society has not fully caught up.

Fathers should not need to exceed expectations just to be seen as capable. A child’s affection should not be the only thing that silences doubters. And a mother’s absence should not be required for a father’s presence to be validated.

What Mike experienced during my illness was not unique. It was simply a sharper example of what many fathers face daily. The side-eyes, the unsolicited advice, the subtle dismissal, it is not personal. It is cultural.

We do not need fathers to mimic mothers. We need them to be empowered as fathers, loving, capable, involved, and seen, not as substitutes, but as equals.

So next time you see a father with his child, don’t ask where the mother is. Do not watch for mistakes. Do not measure him against someone else. Just see him. Let him parent.

For many men like Mike, fatherhood is not a novelty. It is not a temporary act or a special performance. It is a lifelong, loving commitment, as real and essential as motherhood. It is time we gave it the same respect.

WHEN FAIRNESS COSTS THE SALARIED MORE

Posted on by Digital Editor

In the quiet drizzle over Addis Abeba’s streets, tax reform is no longer mere policy. It walks, waits in line, and tightens its belt. Roughly 6.9 million salaried workers across the country, accounting for nearly 15pc of the total workforce, are bearing the brunt of a new fiscal order. Many feel that their daily reality is one of eroded purchasing power, stagnant wages, and residual household debt.

Federal officials, touting equity, recently ushered in a revised income tax law, raising the monthly tax-exempt threshold from 600 Br to 2,000 Br. Heralded as progressive, the measure has proven to be more symbolic than substantive for the average worker. The marginal relief fails to shield families from economic attrition driven by high inflation and weak wage growth.

The federal government estimates an annual revenue loss of 38.4 billion Br from the new threshold, which could swell to 70 billion Br if raised to 3,000 Br, representing a fiscal trade-off of only 0.21pc of GDP. However, the burden remains disproportionately skewed.

Private companies are not immune to tax anxieties. Safaricom Ethiopia Plc, despite amassing 6.1 million GSM users and 8.3 million M-PESA subscribers, projects a four-billion-Birr loss and no breakeven until 2026. It has petitioned for relief from the 2.5pc turnover tax, a levy applied even to loss-making firms. Business groups, including the Ethiopian Chamber of Commerce and industrial giants such as East African Holdings, have their representatives arguing that taxing gross rather than net revenue is not only regressive but also potentially unconstitutional.

Equally contentious is the doubling of the tax on savings interest to 10pc. Banking industry leaders warn that this may erode household liquidity and disincentivise formal saving. In a country struggling to deepen financial inclusion, they fear that the policy could reverse gains made in banking the unbanked, pushing households toward informal financial practices.

The tax reform has also extended its reach into the fast-growing digital economy. Freelancers, content creators, cross-border consultants, and satellite service providers now face new obligations. While this broadening of the tax base may appear logical, experts caution that poor policy design, administrative overreach, and procedural opacity could stifle compliance before it gains traction.

According to experts, beneath these technicalities lies a glaring injustice. A salaried worker earning 14,000 Br monthly now pays over 34,000 Br in annual taxes, while an entrepreneur at the same income level owes the state 5,640 Br. This disparity, experts contend, not only undermines fairness but also deters formal employment and long-term capital formation.

Despite these tensions, federal authorities remain committed to increasing the tax-to-GDP ratio from its current near eight percent, one of the lowest globally, to double digits within three years. It is an ambitious target predicated on expanding the tax net and closing compliance gaps. But success may depend less on revisions to brackets than on public trust. With tax morale already fraying under the weight of economic hardship, technocratic solutions may not suffice. From federal boardrooms to cash-strapped municipalities, a quiet consensus is emerging that taxation should first be credible to be sustainable.

 

The Manual-Less Revolution

Posted on by Digital Editor

Across the world, and certainly in Ethiopia, new devices arrive fresh from the box while their instruction manuals remain untouched. Shiny and promising, these gadgets invite immediate interaction, but the guidebooks that accompany them often feel like an afterthought. Many people turn instead to instinct, a friend’s advice, or increasingly, online videos. This trend reflects more than mere impatience; it marks a profound shift in how people prefer to learn.

Why do so many avoid reading these guides, preferring to spend time trying to make sense of things on their own instead?

Manuals are meant to assist, detailing how to set up, operate, and troubleshoot devices, but often fall short. Filled with technical jargon and structured in stiff, lifeless prose, they alienate rather than guide. Their tone lacks warmth, and their language rarely speaks to everyday users. The result is an object that provides information but not understanding.

Unlike a person, a manual cannot answer questions or adjust its explanation when confusion arises. It offers no demonstration, no dialogue, and no reassurance in moments of uncertainty. In contrast, asking a friend feels more natural and rewarding. The learning becomes social, flexible, and tailored to immediate needs.

Hands-on help carries trust and familiarity, particularly when it comes from a peer or relative. Someone trusted can explain the same steps using simpler words and personal experience. Demonstration adds clarity; repetition invites questions. Such exchanges often bring comfort and confidence that a manual simply cannot provide.

In recent years, a new helper has become very popular: The rise of platforms like YouTube adds another layer to this shift. Tutorials now offer the benefits of visual learning without the need for a physically present teacher. Users can pause, rewind, and replay instructions as many times as necessary. Watching someone else perform a task helps make the abstract feel achievable.

Consider what happened in a friend’s household last week, when her parents purchased a new Smart TV. Its sleek remote and layered menus introduced a digital world unfamiliar to them, far removed from their old set with basic channels. Though fluent in English and Arabic, they left the thick manual untouched. Even as they fumbled through the setup, switching languages and navigating interfaces, the manual stayed in the box.

They struggled to access local news or launch streaming apps, encountering cryptic errors and failed connections. The screen remained stuck on “No Signal,” and the remote’s voice assistant kept triggering by accident. They spent the evening trying various menu settings, their frustration mounting with each failed attempt. At no point did the idea of consulting the manual even arise.

Their solution came in the form of their teenage nephew, known in the family as a tech whiz. Upon arrival, he reached straight for his phone rather than the manual. Within minutes, a YouTube tutorial walked him through the setup, explaining everything from input selection to software updates. The instructions had existed in the manual all along, but the video made the information easier to digest and apply.

This preference for interpersonal or visual learning has deep roots in Ethiopian culture. For generations, knowledge travelled through stories, observation, and apprenticeship. Oral traditions prioritised lived experience over written documentation. That legacy continues today, shaping how people respond to unfamiliar technologies.

While this behaviour is visible in Ethiopia, it reflects a broader global shift. People from many countries increasingly seek visual and interactive instruction over static text. The immediate feedback and clarity offered by online content contrast starkly with the opacity of traditional manuals. As devices become more complex, users gravitate toward methods that mirror human conversation.

Manuals still serve a purpose, especially in technical fields requiring precision. But for everyday users trying to navigate new tools, other learning modes often feel more effective. Whether through a conversation or a video, people want guidance that feels accessible and alive. In a world saturated with devices, learning remains, at its core, a profoundly human process.