Africa: Undersea Cable Buoys Continent's Digital Prospects


27 November 2007
Posted to the web 28 November 2007

Abid Aslam
Washington, DC

Africa, the world's least plugged-in continent, is moving closer to reliable telecommunications and affordable Internet access.

Construction of a 10,000-kilometre undersea fibre-optic cable connecting 21 East, Southern, and Central African countries to West Africa and Europe is to begin next month following the announcement Monday that the International Finance Corporation (IFC) and others have come up with 70.7 million dollars in financing for the project


"The project will transform the African telecommunication landscape and have a direct positive impact on business in East Africa," Lars Thunell, chief executive at the World Bank's private sector arm, said Monday.

In much of the developing world, digital communications have enabled school and college students to study in virtual libraries and to visit counterparts in other countries. Businesses have harnessed the Internet to reach offshore customers and suppliers and to obtain management know-how and language training, among other things. Farmers in remote regions have been able to check market prices for seed, fertiliser, and their produce -- giving them new power over fee-seeking intermediaries.

In Africa, however, the Internet reaches only four percent of the population and users pay the planet's highest fees to connect at the slowest speeds -- when the continent's notoriously erratic electricity supply and satellite connections permit. The situation is worst in the countries to be served by the new cable.

The East Africa Submarine Cable System, or EASSy, is intended to change all this. Once completed, it is expected to provide digital access to 250 million people, or one in four Africans.

Consumers along Africa's east coast typically pay 200-300 dollars a month for Internet access, the IFC said. EASSy will cut the cost by two-thirds at the outset and the number of subscribers will triple, it said.

"Because the project gives open access to service providers, prices will fall further as volume and competition increase," it added in a statement.

The cable will run along the floor of the western Indian Ocean and connect South Africa, Mozambique, Madagascar, Tanzania, Kenya, Somalia, Djibouti and Sudan. At its southern end, it will join cables serving West Africa and Europe.

Thirteen adjoining countries will be linked to the system as additional networks are completed through a broader World Bank initiative. These countries are Botswana, Burundi, the Central African Republic, Democratic Republic of Congo, Chad, Ethiopia, Lesotho, Malawi, Rwanda, Swaziland, Uganda, Zambia and Zimbabwe.

The IFC said it would provide 18.2 million dollars out of 70.7 million dollars in long-term loans sought by the EASSy consortium of companies. The rest would come from the African Development Bank, European Investment Bank, German development bank KfW, and French development bank AFD. The European Union also would provide some financing.

The international lenders are channeling their financing through the West Indian Ocean Cable Company Ltd., formed specifically for the project, the IFC said.

Most of the money for the 235-million-dollar project is to come from 25 private telecommunications operators that make up the 29-company EASSy consortium, the others being government entities. Of the private firms, 21 are African and these will be the cable's main users, the IFC said.

French firm Alcatel-Lucent Submarine Networks is to lay the cable. Firms from Britain, India, Saudi Arabia, the United Arab Emirates, and the United States also are taking part in the venture, according to business documents.

West Africa already enjoys relatively high-speed and low-cost connections to international telecommunications and the Internet through an existing undersea cable. Yet for the most part, according to government and industry sources, Internet usage rates have stalled in the single digits.

Power shortages are partly to blame. In September, the IFC and World Bank launched a separate effort to promote modern and affordable power using products not hostage to fossil fuels or the continent's lamentable electricity grid.

Beyond infrastructure constraints, industry and development sources long have said that efforts to propagate information technology are stymied by low literacy rates and government curbs against citizens' online access and activities.

Even those who make it to the information superhighway frequently find the Western Web sites beyond reach or almost impossible to navigate because these are rich in video and sound and cater mainly to users with not only broadband connections but also top-of-the-line processors in their computers.

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