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Internet shutdown costs Ethiopia US$500K per day in lost GDP

By , ITWeb
Africa , 31 Oct 2016

Internet shutdown costs Ethiopia US$500K per day in lost GDP

An average high-connectivity country stands to lose at least 1.9% of its daily GDP for each day all Internet services are shut down. For an average medium-level connectivity country, the loss is estimated at 1% of daily GDP, and for an average low-connectivity country, the loss is estimated at 0.4% of daily GDP.

This is according to a report by the Global Network Initiative, entitled The Economic Impact of Disruptions to Internet Connectivity which highlights the significant economic damage caused when governments around the world deliberately shut down or disrupt Internet services.

"Governments should recognise the serious consequences of disrupting network access and see shutdowns through a human rights and development lens, not solely through a political or security lens," said GNI Independent Board Chair Mark Stephens, CBE.

According to GNI government-mandated disruption of communications networks—including social media, Internet messaging services, mobile, VoIP and SMS— is a growing global problem.

The organisation points to a recent study by the Brookings Institution which documented some 81 shutdowns in the year between July 2015 and June 2016. That report estimated the total cost of shutdowns to be in excess of US$2.4 billion over that period.

Ethiopia, India, Brazil, Turkey, Morocco, Pakistan, the Republic of the Congo (Brazzaville) and Saudi Arabia are just some of the governments that have disrupted their citizens' Internet access over the past year, stated GNI.

"Shutting down the Internet undermines economic activity and chills free expression," said GNI Executive Director Judith Lichtenberg. "The economic and human rights harms of network shutdowns reinforce each other, and are of particular concern in developing countries, emerging and fragile democracies, and jurisdictions with weak rule of law."

In dollar terms, the report estimates that for the average highly-connected country, the per-day impact of a complete Internet shutdown would amount to US$23.6 million per 10 million people.

For the average country with medium and low levels of connectivity, the estimated GDP impact amounts to US$6.6 million and US$0.6 million per 10 million people, respectively.

GNI says based on this analysis, the ongoing Internet shutdown in Ethiopia, a low-connectivity country with a population of 94 million and a per capita GDP of US$505, is costing its economy just under half-a-million US dollars a day in lost GDP.

The organisation believes more work is needed on the effects of shutdowns on consumer and business confidence, the opportunity costs for businesses and the wider economy, and the social and human rights harms when families are cut off from one another and their access to basic health, education, and other vital services and information is restricted.

In May this year the Web Foundation and Alliance for Affordable Internet (A4AI) lobbied African leaders attending the World Economic Forum to push for wider internet access, a reduction in the prices of basic prepaid data plans, and online rights.

Renata Avila, Global Campaigns Manager at Web Foundation, was quoted at the time as saying, "Most of Africans access the internet via mobile phone, and companies are permitted to create different experiences for different prices, offering faster Internet to those who can pay more and a very limited connectivity experience for the marginal users. Good net neutrality regulation will prevent the creation of even more inequality."

In July the UN Human Rights Council adopted a resolution on the promotion, protection and enjoyment of human rights on the internet, spearheaded by Nigeria, Tunisia, Brazil, Sweden, Tunisia, Turkey, and USA.

The new resolution prohibits any form of intentional disruption to information flow – particularly during situations where access to information is deemed critical, such as during an election, or in the aftermath of a terrorist attack – two situations that affect several African countries.

Although not legally binding, the resolution puts pressure on governments. It also affirmed that the UN has decided to condemn internet shutdowns.

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