The new electronic transaction bill proposes the formation of the national Digital Economy Council, which will be tasked with advising the government on building an economy that is based on digital computing technologies.

Drafted by the Ministry of Innovation & Technology, the proclamation declares that the Council will be instrumental in advising the government about the process of transforming into a digital economy. The Council will also oversee the legislation process of laws for e-transactions and e-government services.

Members of the Council, which includes the Minister of Innovation & Technology, will be named by the Prime Minister. The Prime Minister will also appoint the chair of the Council that will have the Minister of Innovation & Technology as a secretariat.

The bill, which was tabled to the lawmakers at the end of last week, also outlines the legal foundation for the government and private institutions to start offering digital services, mainly the provision of e-commerce and e-government services. It also aims to help the country replace business transactions that are conducted through paper money with electronic-led transactions.

The bill has been in the making for about a year and was prepared in collaboration with the National Bank of Ethiopia (NBE) and the ministries of Revenues and Trade & Industry. It enables the country to practice the sale or purchase of goods or services over computer-mediated networks and enables public organisations to use information and communication technologies for their activities and services. It also involves digital signatures and seals.

Out of the total services provided by public offices, 175 of them are planned to be under e-gov. And so far, 70 services that are provided by 10 public offices are operational. However, these services do not include a digital payment transaction option.

There are four pillars the government has aligned to make progress toward a digital economy: infrastructure development, arranging the technology, crafting policies and laws, and creating a digital society, according to Ahmedin Mohammed (PhD), state minister for Innovation & Technology, which expects 70pc of the society to use digital transactions in five years.

"On the road to the current reforms," said Ahmedin, "we believe the country has to take leapfrog steps so that Ethiopia can become an active player in the digital economy."

The proclamation will serve as a digital medium for all existing legal frameworks on trade, taxation, authentication of documents, signature seals, witnesses, digital payments, consumer protection and data integrity. The bill is also aimed at transitioning the paper-based Federal Negarit Gazeta, an official gazette for the publication of all federal laws, into a digital platform.

However, it does not work for laws and documents that require paper and handwritten signatures such as death and marriage certificates, wills, court warrants, power of attorney documents and forms required for the transfer of immovable collateral.

It is a long-overdue action, according to Tewodors Tassew, a fin-tech expert with a decade of experience.

"It shouldn't have taken this long, because this proclamation is vital to awakening the private sector to engage in the digital economy by laying out the necessary framework," he said. "The private sector can roll out different products; hence it's a progressive step to see fresh new products."