AfDB Supports Satellite Communication in Africa-A Senior Loan of US$ 25 million to finance the New Dawn Satellite Project

12/03/2009
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Tunis, 11 March 2009 - The Board of Directors of the African Development Bank (AfDB) Group on Wednesday in Tunis approved a loan of US$ 25 million for the New Dawn Satellite Project.

The project comprises the design, construction, launch and operation of a pan-African communications satellite system into the 33° East orbital location, ideally positioned to serve the African continent. The satellite, which will comprise 30 physical transponders operating in the C and Ku frequency bands, will provide services in Africa for cellular backhaul, Internet backbone, corporate networking, TV relay and broadcasting. The launch and commencement of commercial operations are expected in early 2011.

The project sponsors are Intelsat, a world leader in fixed satellite operations, and South African investors, including Convergence Partners. The project was able to successfully raise the necessary funds, US$ 250 million, despite difficult market conditions thanks to close collaboration between Nedbank, the Industrial Development Corporation and the AfDB.

The project responds to strong demand for satellite supply capacity, driven by efforts by mobile operators to expand their networks to underserved areas, support businesses and remote communities, and boost socioeconomic development.

The project is in line with the AfDB’s Information and Communication Technology Strategy (ICT) which sets out regional and national infrastructure as its first priority. This includes international connectivity to the rest of the world, regional backhaul links that interconnect countries, national backbones that extend access beyond major cities, and last-mile connectivity to rural and underserved communities. Regional infrastructure is also the focus of NEPAD’s Medium-to-Long-term Strategic Framework, where the AfDB has been designated a lead agency.

Prior to the New Dawn Satellite project, the AfDB had approved investments in three private sector ICT projects. The first was Euro 13 million partial guarantee to MTN Cameroon to cover the loan extended by local commercial banks in Cameroon and Gabon. MTN contributed to the rapid growth in GSM usage by both businesses and the public at large. This was followed by a US$ 50 million senior loan to the RASCOM Telecommunications Satellite Project, which involves the construction and launch of an earth-orbiting satellite system to provide point-to-multi-point telecommunications services throughout Africa with strong focus on intra-African connectivity and rural communications. This was followed by a US$ 14.5 million loan to the East African Submarine Cable System (EASSy), which is an initiative to construct and operate a submarine fiber-optic cable along the east coast of Africa to connect 20 coastal and land-locked countries to one another and to the rest of the world.