RASCOM: AfDB Strengthens Africa’s Telecommunications Sector
Tunis, 24 July 2007 - The Board of Directors of the African Development Bank (ADB) on Tuesday in Tunis approved a US $ 50-million senior loan under its private sector window in support of a Regional African Satellite Communications Organization Members (RASCOM) Telecommunications Project.
The RASCOM project involves the construction and launch of an earth-orbiting satellite system to provide point to multi-point telecommunications services throughout Africa. The project will: (i) provide a full range of telecommunications services to end-users; (ii) provide complete coverage of Africa (urban and rural), including remote locations; (iii) provide international telephone calls and internet connections at low cost; (iv) create direct links among all African countries; (v) allow interurban communications within each country; (vi) permit radio, television, and multimedia broadcast reception in each country as well as the exchange of TV and radio programs between African countries; and (vii) support limited intercontinental connectivity.
Development impacts that are likely to accrue from this project include, but not limited to (i) Rural Communities: RASCOM will provide telephony services (TES) to various remote rural areas throughout Africa which previously had no direct interconnectivity; this translates into a substantial economic value added. Rural end-users will benefit from an estimated consumer surplus of US$ 1.2 billion in present value terms, equivalent to an average of about US$ 210 million per annum; (ii) Interconnectivity: RASCOM will permit lower-cost pan-African interconnectivity for African telecom operators, compared to charges levied by existing service providers; (iii) Bandwidth Lease Services: BLS service subscribers, such as TV broadcasters, internet service providers (ISPs) and big corporations, are expected to benefit from an estimated consumer surplus.
This project demonstrates a very strong rural focus as a socio-economic impact. Even though the RASCOM project is geared to cover the entire continent, the most noticeable impact will be witnessed in rural areas. The full impact will be achieved once the Ground Traffic Segment (GTS) investments are implemented by Telecoms in Regional Member Countries (RMCs). Farmers will have better access to market information, weather forecasts as well as new technologies. This will increase production, boost livelihoods and contribute to combating rural poverty. With internet connectivity and TV services, people in rural areas, particularly women and children, will have access to new sources of information and education. This will help to break the barriers of social and geographical isolation experienced in many rural areas. The project will help bridge the digital divide. The e-Schools Initiative sponsored by e-Africa commission through NEPAD will promote distance learning and will provide a linked ICT platform to all primary and secondary schools (urban and rural).
The RASCOM project is strongly aligned with the Bank Group’s core development policies and strategies as well as the Bank’s NEPAD objectives. RASCOM provides a model for public-private partnerships and will help create an enabling environment for private sector development in Africa.
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