AXIAN TELECOM EXPANSION

The project relates to the investments in the promoters' mobile broadband networks in Tanzania and Madagascar. In Tanzania, the existing hardware of the radio access networks will be replaced by hardware based on a new innovative technology that will substantially improve the networks' energy efficiency. As a result, about 3000 additional sites in the country will get 4G coverage. In Madagascar, 4G will be activated on approximately 1300 sites. In both countries, the promoter will also start to deploy 5G, adding this new technology to a limited number of sites, mainly ln urban areas. Additionally, the project will also include core network upgrade and expansion in Madagascar, investments in microwave links to support the radio access network growth and 3G coverage and capacity expansion in both countries.

The aim is to increase mobile broadband coverage and capacity in Tanzania and Madagascar. The increased 4G and 5G coverage will support the transition to a digital economy in both countries, resulting in significant positive economic and social impacts.

The project relates to the design, roll-out and operation of mobile telecommunications network throughout Madagascar and Tanzania including the initial rollout of 5G.

The transformation to a digital economy is at the centre of both Tanzania's and Madagascar's economic and social development strategy.

The digital agenda in Madagascar is supported by the programme "Digital for all", which recognises Information and Communication Technologies (ICT) as an important enabler of economic development and promotes the implementation of ICT projects. Facilitating the growth of the mobile sector also aligns with the Government's broader economic and social objectives for the Malagasy economy

In Tanzania, the newly Five-Year Development Plan for the period 2021-25, "Realising Competitiveness and Industrialisation for Human Development", sets out specific objectives related to the ICT sector as enabler of economic growth. The country's Ministry of ICT (MCIT), established in December 2021, acknowledges the potential of ICT for the socio-economic empowerment and recognises that the extension of connectivity is facing challenges, which are mainly linked to the insufficient funding.

The project is fully aligned with the objectives of the Neighbourhood, Development and International Cooperation Instrument (NDICI) ? 'Global Europe' for the current MFF period (2021-2027) and addresses the specific market failure leading to under-investment in broadband network infrastructures in lower profitability areas, mainly due to low average revenue per user levels, combined, in the case of hard-to-reach areas, with high unit costs for the infrastructure.

The project is not expected to have significant negative environmental and social impacts. On the other hand, the roll-out of the infrastructure will support the country's transition to a digital economy, resulting in significant positive social impacts through increased 4G and 5G coverage (fourth and fifth generation of mobile phone technology). The promoters and their main supplier for the project are well-established companies with high capacity, which ensures high quality services. The investments related to radio access network modernisation in Tanzania, which objective is to improve the networks' energy efficiency contributes to climate change mitigation.

The sizeable hard currency loan provided by the European Investment Bank with a relatively long maturity and grace period will enable the promoters to secure the equipment internationally in order to implement the Project in line with best practices.

The promoter will be required to implement and operate the relevant investments in compliance with applicable national environmental law and similar EU requirements. To that end, the EIB will assess the promoter's capacity, approach and procedures to implement the different projects in line with the EIB's environmental and social standards.

The promoter shall ensure that the project implementation will be done in accordance with the EIB's Guide to Procurement.

Under EFSD+ Guarantee