Johannesburg, March 27, 2008 —
IFC, a member of the World Bank Group, announced today that construction
has started on the East African Submarine Cable System, a landmark fiber-optic
cable project that will connect 21 African countries to each other and
the rest of the world with high-quality Internet and international communications
The supply contract for installation of the cable, known as EASSy, is now
in force. The necessary funds have been provided by the consortium of 25
telecommunications operators, which includes 19 African companies. The
cable will be installed by Alcatel-Lucent along the sea bed off Africa’s
east coast. It is expected to be operational by the first half of 2010.
“We are pleased to work with the EASSy Consortium in laying this new cable
that will expand communications capabilities and help reduce the digital
divide in the region,“ said Etienne Lafougère, President of Alcatel-Lucent’s
submarine network activity.
Five major development finance institutions are partnering to provide the
project’s long-term loan financing of $70.7 million, with $18.2 million
coming from IFC. The balance of the project cost, $247.1 million, will
be provided by the EASSy consortium members.
"We are very pleased that this long awaited submarine cable has formally
been sponsored by the majority of the regional operators and by some of
the leading international industry players,” said Mohsen Khalil, IFC Director
for Global Information and Communication Technologies. “This is a very
important milestone toward implementation of the EASSy cable, which will
transform the telecommunications landscape in the region. It will provide
Internet and other communications access for 250 million Africans and substantially
reduce costs for consumers and businesses.”
Consumers along Africa’s east coast typically pay between $200 and $300
a month for Internet access via satellite. These prices, some of the world’s
highest, create a barrier to usage and restrict economic activity and growth.
Once the EASSy cable is in place, prices for international connectivity
are expected to drop by two-thirds at the outset, and the number of subscribers
will increase rapidly. Because the project gives open access to service
providers, prices will fall further as volume and competition increase.
This is expected to stimulate the development of new knowledge-based industries,
call-centers, and similar ventures. Educational and health activities in
the region will also benefit from access to low-cost Internet.
In a separate initiative, the World Bank Group is assisting with the implementation
of regional distribution networks to connect landlocked countries in East
Africa to each other and the EASSy cable, helping maximize access.
The cable will run 10,000 kilometers from the continent’s southern tip,
around the African horn, and into the Red Sea, connecting South Africa,
Mozambique, Madagascar, Tanzania, Kenya, Somalia, Djibouti, and Sudan.
Another 13 adjoining countries will also be linked to the system as terrestrial
backbone networks are completed through the broader World Bank Group initiative;
these include Botswana, Burundi, the Central African Republic, the Democratic
Republic of Congo, Chad, Ethiopia, Lesotho, Malawi, Rwanda, Swaziland,
Uganda, Zambia, and Zimbabwe.
A short video (available in both English and French) on IFC and the World
Bank’s efforts to connect East Africa can be found at www.worldbank.org/rcip/video.
A map showing the gap that the East African Submarine Cable System is filling
can be downloaded at http://go.worldbank.org/GKHOFFDJB0.
Use of the map is free of charge.
IFC, a member of the World Bank Group, fosters sustainable economic growth
in developing countries by financing private sector investment, mobilizing
private capital in local and international financial markets, and providing
advisory and risk mitigation services to businesses and governments. IFC's
vision is that people should have the opportunity to escape poverty and
improve their lives. In FY07, IFC committed $8.2 billion and mobilized
an additional $3.9 billion through syndications and structured finance
for 299 investments in 69 developing countries. IFC also provided advisory
services in 97 countries. For more information, visit www.ifc.org.
To learn more about the IFC–World Bank Global ICT department, visit www.ifc.org/ict.
1. Bharti Airtel Limited, India
2. Botswana Telecommunications Corporation (BTC)
3. British Telecommunications
4. Dalkom Somalia
5. Djibouti Telecom S.A.
6. Etisalat, United Arab Emirates
7. France Telecom
8. Mauritius Telecom
9. MTN, South Africa
10. Neotel Proprietary Limited, South Africa
11. Saudi Telecom Company (STC)
12. Comores Telecom
13. Sudan Telecom Company Limited (Sudatel)
14. Tanzania Telecommunications Company Limited
15. Telecom Malagasy
16. Telecommunicacões de Mocambique, (TDM)
17. Telkom Kenya Limited
18. Telkom SA Vodacom, South Africa
19. Zambia Telecommunications Company Limited
20. Zanzibar Telecom Limited (Zantel)
21. Uganda Telecom Limited
22. U-Com Burundi SA
23. Office National Des Telecommunications,
24. Lesotho Telecommunications Authority
25. Gilat Satcom Nigeria Limited
1. International Finance Corporation (IFC),
World Bank Group
2. African Development Bank (AfDB)
3. Agence Française de Développement (AFD)
4. KfW, Germany
5. European Investment Bank (EIB)