IMF Says Ethiopia’s AI Gains Depend on Power, Connectivity and Skills
An IMF assessment says AI could lift sub-Saharan African output by about 4% over a decade, but Ethiopia and its neighbours need stronger electricity, connectivity, computing capacity and digital skills to capture the gains.
An International Monetary Fund assessment says artificial intelligence could raise economic output in sub-Saharan Africa by about 4% over the next decade, but only if governments expand reliable electricity, internet connectivity and digital skills.
The assessment, reported by The Reporter Ethiopia on July 22, 2026, says the region could see productivity gains of only about 0.2% without those investments and related policy reforms. The IMF’s AI Preparedness Index places sub-Saharan Africa near the bottom globally, ahead of only South Asia, because of gaps in digital infrastructure, technical skills and regulatory capacity.
Ethiopia is among the lower-performing countries in the index’s low-income group. The report identifies limited AI adoption, shortages of specialised skills and insufficient computing capacity as constraints, while noting that Ethiopia’s telecommunications expansion offers a foundation for wider use of AI-enabled services.
According to the figures cited in the assessment, 3G coverage reaches 98.7% of Ethiopia’s population and 4G coverage about 74%. Coverage alone does not guarantee access, affordability or effective use, however, and reliable electricity remains a major regional obstacle.
Across Africa, 38% of people used the internet in 2024, compared with a global average of 68%. The continent has about 160 data centres, or roughly 5.5% of the global total, and nearly half are concentrated in South Africa, Nigeria and Kenya. That concentration could widen differences in AI readiness between African economies as investment accelerates.
The IMF recommends investment in national grids and mini-grids, especially around schools, health facilities and other public institutions, alongside fibre backbones, open-access broadband and technical education. It says those measures would help countries adopt and adapt AI while managing potential labour-market disruption.
Kenya and Rwanda currently lead East Africa in AI readiness, according to the assessment, reflecting Kenya’s private technology sector and Rwanda’s coordinated digital policies. For Ethiopia, the findings suggest that telecom network expansion will need to be matched by dependable power, affordable connectivity, computing infrastructure and workforce development if AI is to deliver broad economic gains.