NEPAD fibre project announces its shareholdings – but where will it get its own money?

Telecoms

First it was called EASSY before they departed. Then it was the NEPAD ICT Broadband Infrastructure Network for Eastern and Southern Africa, now it’s the Baharicom cable. Three years ago it was difficult to persuade anyone to build fibre cables to Africa, now the place is awash with them. But who exactly is doing what remains confusing, writes Russell Southwood.

NEPAD last week announced the intended shareholdings in the cable it intends to build in partnership with Baharicom. African telcos are taking up 45%, international investors 25% and NEPAD itself 30 %. It is not clear where the money for NEPAD’s 30% shareholding will come from. The donor finance institutions are already committed to EASSy but NEPAD seems confident it can attract the money. Perhaps the South African Government has made promises?

The budget for the new cable has been set at US$2 billion and will follow more or less the same route as the Seacom cable down the eastern seaboard. It will finally end up being named Uhurunet. It has an increased capacity to all destinations of 3.84 Terrabits per sec, of which 1.2 terrabits per sec will be available to the Nepad SPV, compared with the original 640 gigabits.

It is likely to get approval to land in South Africa as the South African Minister for Communications Ivy Matsepe-Casaburri seems to be walking backwards from her earlier ill-judged announcement that no cable could land unless it was majority owned by South African investors. Seacom has already cleared that hurdle.

South African telecom operators Telkom, Neotel and MTN together own some 27 per cent of the proposed 50,000 km Uhurunet cable. What is unclear is how these commitments line up alongside other commitments made by these companies. Telkom and MTN are both investors in the EASSy cable and Neotel has been identified as one of the South African investors in Seacom.

Also some operators have already begun discussing the idea of building their own cables. And as NEPAD policy adviser Dr Edmund Katiti observed: "Such initiatives would duplicate and render the Nepad Network redundant."

The Nepad e-Africa Commission had also urged member countries to expedite the ratification of the 2006 Kigali Protocol by last Thursday. Only 12 countries have signed so far