Since formal independence from Ethiopia in 1993, Eritrea has faced many economic problems, including lack of financial resources and chronic drought, which have been exacerbated by restrictive economic policies. Like the economies of many African nations, a large share of the population – nearly 80% in Eritrea – is engaged in subsistence agriculture, but the sector only produces a small share of the country’s total output.
The Internet penetration rate was 1.3% in 2017. In Eritrea, terribly inadequate service is provided by state-owned telecom monopoly. Most fixed-line telephones are in the capital, Asmara, whereas cell phone use is only slowly increasing throughout the country, and no data service is provided. Combined fixed-line and mobile-cellular subscribership is less than 10 per 100 persons.
The Eritrea Telecommunication Services Corporation, more commonly known as EriTel, is the sole operator of both landline and mobile telephone communication infrastructure in Eritrea. However, it is but one of several internet service providers in the country. Internet access reaches 0.8% of the total population.
Since the conclusion of the Ethiopia-Eritrea war in 2000, the Eritrean government has expanded military- and party-owned businesses to complete President ISAIAS’s development agenda. The government has strictly controlled the use of foreign currency by limiting access and availability; new regulations in 2013 aimed at relaxing currency controls have had little economic effect. Few large private enterprises exist in Eritrea and most operate in conjunction with government partners, including a number of large international mining ventures, which began production in 2013. In late 2015, the Government of Eritrea introduced a new currency, retaining the name nakfa, and restricted the amount of hard currency individuals could withdraw from banks per month. The changeover has resulted in exchange fluctuations and the scarcity of hard currency available in the market.
While reliable statistics on Eritrea are difficult to obtain, erratic rainfall and the percentage of the labor force tied up in national service continue to interfere with agricultural production and economic development. Eritrea’s harvests generally cannot meet the food needs of the country without supplemental grain purchases. Copper, potash, and gold production are likely to continue to drive economic growth and government revenue over the next few years, but military spending will continue to compete with development and investment plans.
The Eritrean Telecommunication Services Corporation (formerly the Telecommunications Service of Eritrea), more commonly known as EriTel, is the sole operator of landline telephone communication infrastructure in Eritrea. It is also the sole operator of the mobile telephone service and a main player in the Internet service provider market. EriTel also controls the national Internet gateway.
(None reported as of January 2018)