Africa’s ICT sector and China

Chinese investments in Africa’s ICT infrastructure passed US$1bn for the first time in 2015. This was primarily due to the activities of one of the world’s largest telecommunications equipment manufacturers, Huawei. The company’s influence on connectivity in Africa is already substantial, and looks set to grow. 

Several finance arrangements involving Huawei were announced in 2015:

Eximbank of China agreed a preferential loan agreement worth US$338m to finance the second stage of the National Telecommunications Broadband Network project in Cameroon, where Huawei is already very active. The fibre optic network aims to substantially improve access to highspeed internet as well as services such as high-definition television and telephone. Huawei will carry out the construction work;

Huawei is the project contractor for Phase Two of the National Optic Fibre Backbone Infrastructure Extension Project (NOFBI) in Kenya, for which China is providing US$107m towards implementation. The project will provide 1,600km of fibre linking all 47 counties and an additional 500km dedicated to military use. Phase Two adds to the existing 4,300km of cable completed in 2009, which connects 58 towns in 35 counties.

In Zimbabwe, TelOne signed a US$98m loan facility with Eximbank of China to help finance its network modernisation programme. Huawei is the project contractor. In Togo, 500 administrative buildings will be connected by a US$22m fibre optic network built by Huawei and funded by China Eximbank. The bank has also provided a US$99m preferential loan for the establishment of a fibre optic backbone in Niger and another preferential loan for Benin’s telecommunications sector, part of which will be used to develop the country’s broadband network.

Huawei employs around 10,000 people across Africa, with an emphasis on local staff trained on the continent and in China. It has training centres in South Africa, Egypt, Tunisia and Angola focused on technology development.

One of the most significant announcements of 2015 in terms of Africa’s ICT infrastructure was the Cameroon-Brazil Cable System (CBCS), now called the South Atlantic Inter Link, a planned submarine communications cable in the South Atlantic Ocean linking Kribi in Cameroon with Fortaleza in Brazil. International traffic from Africa to America is currently routed via Western Europe and the CBCS will provide a direct route between the two continents. Construction costs alone are estimated at US$130m, and there are reports that Eximbank of China may put up US$81m while Cameroon’s state-owned Camtel, China’s Unicom and Spain’s Telefónica may also support the project.

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