Strengthening Ethiopia’s data ecosystem

Ethiopia is undergoing a rapid digital transformation shift, with its digital economy projected to contribute 5.3% of GDP in 2025 according to the World Bank. The country has witnessed an unprecedented growth in internet penetration, reaching over 40 million users in 2024 as a result of increasing mobile connectivity, digital financial systems, and e-government adoptions. This shift is underpinned by the government’s Digital Ethiopia 2025 Strategy, which promotes a technology-enabled public sector, expanding Fintech solutions and online public services. 

As part of its efforts to build a resilient, thriving data ecosystem, Ethiopia is rolling out digital public infrastructure (DPI) to support secure identity verification, improve data sharing across government agencies, and enhance evidence-based policymaking. These efforts are already reshaping public service delivery, governance, and economic planning. For example, FAYDA, which is part of the country’s national ID program – is designed to provide a secure, interoperable identity system, helping streamline public service access for its population of more than 126.5 million. Similarly, Ethiopia’s rapidly evolving mobile money ecosystem, including state backed Telebirr and private sector innovations, has expanded financial inclusion by enabling seamless digital transactions, bill payments, and social benefit transfers. 

However, to fully harness the power of DPI and unlock data as a strategic economic asset, Ethiopia needs a robust data governance framework that strengthens interoperability, enhances security, and promotes ethical data use. Without clear regulations, standards, and mechanisms for data sharing, data remains fragmented across government agencies and private sector entities, limiting innovation and increasing security risks. In short, Ethiopia has reached a critical juncture—one where strengthening national data governance policies and practices will define the country’s ability to leverage data-driven transformation for inclusive growth and economic opportunity. 

Without strong data governance and infrastructure, the country risks regulatory fragmentation, data security vulnerabilities, and missed opportunities for innovation and economic growth.   

Several key factors highlight the urgency of strengthening Ethiopia’s data ecosystem: 

1. A rapidly expanding digital ecosystem. Ethiopia’s digital transformation is accelerating, with a growing reliance on data for public service delivery, financial inclusion, and economic planning while also generating increased volumes of data. Without a structured governance framework, the country risks data misuse, inconsistent standards, and regulatory fragmentation, making it difficult to ensure security, interoperability, and accountability. 
2. New legal policies demand implementation. Although Ethiopia has enacted a privacy and data protection law, enforcement remains weak due to the absence of a dedicated regulatory oversight structure, clear implementation guidelines, and sector-specific compliance mechanisms. Strengthening enforcement will involve establishing an independent data protection authority, developing standardized legal frameworks, and investing in capacity-building initiatives to train public institutions on data rights, security, and compliance enforcement. These steps will ensure that public and private sector actors follow structured governance principles, reducing risks related to data breaches and privacy violations. 
3. Global and regional alignment. To align with global and regional data governance standards, Ethiopia would benefit from aligning its regulatory approach with frameworks such as the African Union’s Digital Transformation Strategy, the AU Data Policy Framework, and international principles such as GDPR. This will require creating data interoperability models, streamlining cross-border data flows, and implementing compliance frameworks that support both local innovation and global investment. Collaboration with regional and international stakeholders will also help position Ethiopia as a leader in responsible data governance in Africa. 
4. Government commitment to digital policy. Ethiopia has already demonstrated a strong commitment to digital transformation through its Digital Ethiopia 2025 Strategy, but maximizing the potential of this initiative requires a phased approach to policy implementation. Developing sector-specific data governance models in critical areas such as agriculture, finance, and public health will provide a structured pathway to scale national data policies and strategies. Additionally, embedding transparency and accountability measures will build public trust, ensuring that citizens and businesses actively engage with Ethiopia’s evolving digital public infrastructure. 

Without addressing these structural barriers, government institutions, citizens, and businesses will continue to face obstacles in leveraging digital services, innovations will struggle to navigate the regulatory landscape, and the broader economy will miss opportunities for inclusion and sustainable growth. 

Throughout 2025, we will be working with the Office of the Prime Minister of Ethiopia and key stakeholders across the government and beyond to implement a series of interventions aimed at improving its systems, policies, and practices. As part of this initiative, we are supporting Ethiopia to: 

1. Develop a national data governance framework that reinforces data management and interoperability across sectors. 
2. Create a proof of concept for responsible data sharing to support innovation in selected sectors, demonstrating how structured data use can improve public services, economic planning, and social impact. 
3. Strengthen their digital ID system, FAYDA, through supporting a self-assessment, maximizing learning opportunities, and producing insights and recommendations to guide best practices.  

Each of these efforts are essential to building a resilient and future-ready data ecosystem in Ethiopia. These elements will lay the foundation for Ethiopia’s long-term digital transformation, fostering trust, innovation, and economic growth. 

With the right frameworks and tools in place, Ethiopia can lead the way in – and set an example for – responsible digital transformation across Africa. 

We bring the expertise needed to ensure Ethiopia’s approach is practical, scalable, and aligned with global best practice. For several years, we have been providing expert guidance, resources, and tools to help governments develop good digital infrastructure and data ecosystems. Through our continued efforts, such as creating a national data strategy with Sierra Leone and building a dedicated HealthTech Marketplace for health innovations, we have consistently demonstrated our ability to understand the diverse needs and challenges of country stakeholders and provide tailored support that aligns with their objectives.  

This engagement is expected not only to result in a meaningful data governance framework that strengthens policy foundations for responsible and effective data use – aligned with continental frameworks – but will also set Ethiopia up with a roadmap and pilot project that demonstrates ways in which data can be harnessed for development.  

For further engagement, please contact Ibrahim Mamma Hussein via imhussein@dial.global