Nepad’s ocean cable needs $2bn injection
The much-discussed Nepad cable does not yet have any committed funding, but high tech companies and financial institutions in Africa and abroad were showing interest in investing, delegates said after ministers and government officials from 10 countries met yesterday.
The ministers spent five hours discussing the cable, though the funding details are still sketchy.
Cables will run around Africa’s west and east coasts then on to India, the Middle East, the UK and the US. “It will be in the water and able to meet the requirements of the 2010 project in this country,” said Henry Chassia, the deputy chairman of the Nepad e-Africa commission.
The cables will be built in competition with two private projects, the Seacom cable and the $235m Eassy cable, which are already well advanced in their plans. However, they will not be allowed to land in SA and provide desperately needed cheap bandwidth unless they are majority owned by African investors.
Communications Minister Ivy Matsepe-Casaburri said the Nepad cable would be 60% African owned, meeting the criteria she was drawing up for companies wanting to land cables in SA. “Africa must take responsibility for its own development so we don’t depend on foreigners,” she said.
African governments clearly had to lead their own undersea cable initiative as private telecoms operators were only interested in profits and did not care about the developmental benefits of providing cheap voice and data services, Matsepe-Casaburri said.
“SA’s experience speaks for itself, and that’s one of the reasons you can’t have a privately led consortium.” Telkom was a key stakeholder in the existing Sat-3 undersea cable, and the cost of bandwidth was artificially high because it was a “private club”, she said. “We couldn’t bring the price down because that club decided the costs.”
Private companies backing the Nepad cables had to accept the pricing principles set out by the governments, she said.
“We are not saying you can’t make a profit, but you can’t make a profit that doesn’t allow countries to grow because the costs are so exorbitant.”
Chassia said there had been discussions with companies funding the private cables to see if they would support the Nepad cable instead, or in addition to those projects. Telkom, Neotel and MTN together own 27% of the Eassy cable. But it is not clear whether any will withdraw from the private projects and support the Nepad project, especially since the private cables are further advanced and free from the risk of government interference.
So far, only 12 governments have signed a commitment to the Nepad cable, though others are expected to add their support as the project progresses.
Rwanda’s minister for energy and communications, Albert Butari, said the cable might cut the cost of bandwidth to a tenth of the current price. The cost of communications in Africa now was so high that most people were not benefiting from technology, he said.
Loading ...