1RCIPMW, AFFORDABLE BROADBAND CONNECTIVITY FOR MALAWI

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Overview of the presentation

• STATISTICAL BACKGROUND

• RATIONALE FOR THE PROJECT

• PROJECT OBJECTIVE AND DESCRIPTION

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STATISTICAL BACKGROUND

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STATISTICAL BACKGROUND STATISTICAL BACKGROUND

0.0

20.0

40.0

60.0

80.0

100.0

120.0

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

To

tal te

lep

ho

ne

s (

m)

Sub-Saharan Africa (IDA) Sub-Saharan Africa (total)

ICT revolution in Africa

The total number of telephones in Sub-Saharan Africa has increased by >14 times in 10 years

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Growth of the Telecom Sector in Malawi Growth of the Telecom Sector in Malawi

10%

40%

61%66%

79%86%

90% 92% 94%

4%

20%

30%36%

43%50%

55% 59% 62%

1%8%

12%17%

22%28%

33%38%

43%

0%

20%

40%

60%

80%

100%

1998 1999 2000 2001 2002 2003 2004 2005 2006

Pen

etra

tion

per

100

inha

bita

nts

Urban Total Rural

Malawi

6

Comparison of international call rates Comparison of international call rates

$0.00

$1.00

$2.00

$3.00

EAP ECA LAC MNA SAR SSA

3-M

inu

te C

all

to

th

e U

S (

US

$)

20062006

7

Comparison of Mobile Rates

0.00

0.05

0.10

0.15

0.20

0.25

0.30

Angola South Africa Nigeria Pakistan Bangladesh India

US

$ (

20

06

)

Effective revenue per calling minute (Mobile operators, 2006)

8

Comparison of broadband penetration

02468

1012141618

EAP ECA LAC MNA SAR SSABro

ad

ban

d S

ub

scri

bers

per

1,0

00

Peo

ple

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Economic implications of the digital divide Economic implications of the digital divide

World bank 2007

0

10

20

30

40

50

6

OECD SSA

4x longer

US$ per container

0

500

1,000

1,500

2,000

2,500

OECD SSA

At more than 2x the cost

•$300 Billion Industry … only 10% realized•India / Canada / Ireland have captured 75% of the realized market

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PROJECT RATIONALE

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From the digital divide to digital advantages

• Economic Growth

– Broadband can be an effective tool in enhancing economic

efficiency in Malawi and therefore growth of any sector in the

economy

– Broadband can spur new business models and therefore

growth of the ICT sector

– Broadband is a platform to launch advanced

development/commercial services

– ICTs link people across geographical boundaries: global

village

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PROJECT OBJECTIVE AND DESCRIPTION

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PROJECT OBJECTIVES

-To address the Missing Gap (coast connectivity)-To improve quality , affordability and availability of broadband

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RCIPMW project approach

• Open access and pro-competition format for all network elements

• Sector wide approach to facilitate commercial service uptake and

the participation of diverse role players

• PPP model of implementation for efficiency, private sector

resource mobilisation

• Private ownership and operation of network infrastructure

elements

• Redundancy/diversity of routes, cables and landing stations to

enhance competition

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RCIPMW project description

• RCIP is multi-lateral project to connect to IO submarine cables

• Funding sourced from the WB

• 2 year rollout plan

• Kenya, Burundi , Madagascar, Rwanda have benefited

• Malawi component awarded the sum of US$ 20 million

• Submarine cable expected to be operational by 2010

• PPP model to be used for both wet and dry portions

• GOM is a long term capacity pre-purchaser

• PC designated implementation unit

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Project components

1. ENABLING ENVIRONMENT

– Capacity Building and Advisory Support

– Regulatory Reform Support

– Environmental Management and Resettlement

– Monitoring and Evaluation & Communications

2. CONNECTIVITY

- Pro-competition Open Access

- Fibre Connectivity to the Coast

- Virtual Landing Point

- Targeted Beneficiaries

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Project Components Cont’d

3. PROJECT MANAGEMENT

- RCIPMW Establishment and Set up

- Project Steering Committee (MACRA, MICE, MoF, MoPDC,

NRA, MoLNRE, MoJ)

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Progress to dateProgress to date

• Stakeholder consultations during the preparatory stages - completed

• Covenant Requirements of the IDA – almost complete

• Authorisation Bill - passed by Parliament on 14th July 2009

• Recruitment and Appointment of Project Staff - PM, FMS, PPS

• Project Appraisal Document (PAD) – Country Annex Issued

• Environmental Social Management Framework – done

• Resettlement Policy Framework – done

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Work in progress and outstanding items Work in progress and outstanding items

• The Project Work Plan for period August 09 to an 11 - in progress

• The drafting of TORs governing consultants, technical advisers and

goods suppliers – in progress

• Recruitment of consultants and technical advisers - outstanding

• PPP broadband connectivity tender – outstanding

• VLP tender – outstanding

• Targeted institutions sub component – outstanding

• Legislation/regulatory framework review/reform (other parties

responsible) – outstanding

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Programme expectationsProgramme expectations

• Government launches tender to supply broadband regional

connectivity from Malawi to Dar-Es-Salaam

• Operators build Malawi-Tanzania high capacity hop

• Government signs long-term supply contract with winning bidder

• Bidder owns and operates network infrastructure under strict

conditions

• A VLP is established in Malawi granting all operators and ISPs

equal access

• There is an up to tenfold drop in broadband charges

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For more information, please contact :

The CEO The Privatisation CommissionP.O. Box 937Blantyre.

Tel: 01 823 655 Fax: 01 821 248 E-mail: info@pcmalawi.org

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Thank You for Your Attention