Recent Internet shutdown cost Ethiopia over $100 million USD

Ethiopia suffered a loss of at least $100 million due to the internet shutdown by the government for 23 days this month. This is according to NetBlocks, a group that monitors internet freedom worldwide. It calculated the daily impact of the cut in terms of direct economic costs.

“Beyond the impact on fundamental rights, each day of internet shutdown in Ethiopia runs up a bill in excess of $4.5 million, in terms of the economic impact to the GDP according to the Cost of Shutdown Tool (Cost),” it said.

The economic impacts of blackouts are calculated using the Cost, which was developed by internet access advocacy groups, the Internet Society, and Netblocks.

The tool combines telecom industry and development indicators to assess the impact of internet disruptions on digital prosperity.

“The 23-day shutdown had an estimated economic impact in excess of $100 million on the country’s economy,” Alp Toker, NetBlocks’ Executive Director, told the Nation in an email exchange.

“The Cost, incorporating the Collaboration on International ICT Policy for East and Southern Africa (CIPESA’s) economic model, indicates direct and indirect losses are divided evenly, with approximately $50 million in the net direct impact and the remainder representing indirect losses.”

These figures primarily represent lost business but also factor informal trade and a degree of lost confidence.

“Given the extended duration of Ethiopia’s shutdown and heightened reliance on digital communications during the Covid-19 pandemic, we believe the overall impact to be somewhat higher.” […] CONTINUE READING