To extend the benefits of economic growth to a larger proportion of the population, Djibouti is relying on expanding the use of IT across the public and private sectors. In addition to improving the competitiveness of small and medium-sized enterprises, an increase in IT adoption is viewed by the authorities as a way to reduce youth unemployment.
Under Djibouti Vision 2035, the country’s longterm economic and diversification development strategy, policymakers have prioritised the ICT sector and the uptake of technology among the population and the business community. The government has been working to realise its goals for a number of years. For example, as Djibouti built its transport infrastructure, it also used state-owned Djibouti Telecom to invest in several undersea fibre-optic cables linking the country with Europe, the Middle East, Eastern Africa, the Mediterranean and South Asia. Moreover, the country inaugurated the Djibouti Data Centre in 2013, the first data centre in the Horn of Africa and the first Tier-3 data centre in East Africa (see ICT chapter).
Policy
To accelerate these efforts further, several policy measures have been taken in tandem with overall economic reforms. Among those is the ambitious 10-year roadmap for ICT, the Strategic Integrated Plan 2014-24, which seeks to accelerate overall IT adoption. In 2018 Djibouti secured a $15m loan from the World Bank to implement a four-year programme to expand IT usage in the public sector. This includes the development of e-government services, and the adaptation of tax and Customs regulations to improve management through technology. The ultimate goal is to improve tax collection through a reliable digital system. Additionally, the project aims to centralise all registries to establish an ID system for citizens to use in all electronic interactions with the government. More recently, in July 2021 Djibouti created the Ministry of Digital Economy and Innovation in order to regulate and steer future sector development.
Affordability
However, several challenges and competitive barriers remain. Although ICT usage across public structures can be encouraged by policy measures, getting a larger proportion of Djiboutians to adopt ICT tools remains limited by affordability. This is in part due to the structure of the sector and the relative lack of competition; Djibouti Telecom is the sole provider of mobile and internet services across the country. As a result, in 2020 Djibouti had 2.5 high-speed fixed-internet connections per 100 people, compared to 17.1 in the Middle East and North Africa (MENA), and 16.9 for Africa as a whole. Moreover, the country registered 23.6 mobile broadband connections per 100 people in 2020, compared to 73.3 in MENA and 75.8 in Africa. The World Bank estimates that the price of a fixed-internet subscription is equivalent to a month’s income for about 60% of the lowest-income households.
Mobile phone usage has also progressed slowly, expanding from 314,000 active mobile subscriptions in 2015 to 434,000 by 2020, according to figures from the World Bank. Mobile internet services, meanwhile, had a penetration of 25% in 2021.
Internet access remains costly relative to regional benchmarks. While the average monthly cost of a high-speed mobile internet subscription was $45.23 in Kenya and $33.08 in Ethiopia, Djiboutians had to pay an average monthly price of $95.52 in 2022, according to the World Bank.
With ICT usage seen as an important enabler of economic development, reducing costs is a priority for the sector. Enlarging the customer base will likely require the opening up of the sector to private players. In 2021 the government announced its intention to allow a private operator to acquire a minority stake in Djibouti Telecom; however, it remained a government-owned enterprise as of early 2023.
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