CABO VERDE REGIONAL DIGITAL CONNECTIVITY

Promoteur – Intermédiaire Financier

CABO VERDE TELECOM SA

Lieu

• Cap Vert

Description

The project relates to the promoter's investment plan to support Cape Verde's strategic objective to become a digital hub in the West Africa region. In line with this objective, the promoter will invest in a new connection to a latest generation submarine cable system connecting Europe and the West coast of Africa. In addition, the promoter will also invest in the replacement of the passive fibre optic submarine cable interconnecting the country's islands, which is reaching its end of life, as well as in the modernisation of the information systems, both software and hardware, to improve functionality and efficiency.

Additionality and Impact

The projects to be financed through the Framework Loan relate to the construction of a branch between a new submarine cable set to link Europe to South Africa, and Cape Verde's national network; an urgent modernisation of Cape Verde's national transmission network, the promoter's information systems and the upgrade of other areas of the promoter's digital infrastructures. The digital transformation of the country is at the centre of Cape Verde's economic and social development strategy.

The Framework Loan 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 population density and low average revenue per user levels, combined, in the case of hard-to-reach areas, with high unit costs for the infrastructure.

The project will support the EU's Global Gateway which aims at narrowing the global investment gap worldwide and secure links in the digital sector to strengthen health, education, and research systems across the world. Moreover, Cabo Verde's ambitions and the project are aligned with the EU's Digital Agenda and regional digital integration objectives under the Global Gateway to boost smart and secure digital systems across the world in the 2021-2027 period.

The underlying projects are not expected to have significant negative environmental and social impacts, after mitigation measures are implemented. 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.

The Framework Loan will mainly contribute to SDG 8 Decent Work and Economic Growth, SDG9 Industry, Innovation and Infrastructure and SDG10 Reduced Inequalities.

The financial contribution from the EIB in this project is deemed important. The favourable interest rate and flexible terms offered by the Bank including flexibility with disbursements, the substantially long availability and grace period: these elements are all vital for the implementation of projects of this nature and in countries like Cape Verde.

Objectifs

As part of the EU's Global Gateway strategy, EIB Global is supporting this project, which is expected to upgrade and enhance the existing digital infrastructure enabling environment in Cape Verde, to support the Government of Cape Verde in their ambitious digitalisation strategy and objective to become a regional digital hub. As a result, the project is expected to have a number of important socio-economic benefits for Cape Verde and the wider West Africa region. The project is expected to improve the availability and quality of digital connectivity for the local private sector, including SMEs. By supporting Cape Verde in consolidating its position as a regional digital hub of excellence, the project will stimulate innovation and indirectly contribute to the creation of highly skilled jobs in Cape Verde and potentially the wider West Africa region. In particular, Cape Verde's connection to Google's Equiano submarine cable would consolidate the country's cable access, and enable Cape Verde to act as a safe and secure global and regional transit platform and digital traffic. Cape Verde could thus become a digital converging point between Africa, Europe and South America, providing backup systems for the region, benefiting from Cape Verde's transparent and stable regulatory framework.

Commentaires

NDICI Investment Window 4

Secteur(s)

• Télécom - Information et communication

Under Global Europe NDICI guarantee

Under EFSD+ Guarantee

Montant BEI envisagé (montant approximatif)

EUR 37 million

Coût total (montant approximatif)

EUR 80 million

Aspects environnementaux

The project relates to the deployment of new submarine cables, as well as investments in information systems modernisation, which are expected to be located in existing premises. As per the assessment performed within the EU, where and if applicable, the requirements of the Environmental Impact Assessment Directive (EIA) 2011/92/EU as amended by EIA Directive 2014/52/EU, Birds Directive 2009/147/EC and Habitats Directive 92/43/EEC or the equivalent national regulation will be verified during appraisal.

Passation des marchés

The Bank will require the promoter to ensure that implementation of the project will be done in accordance with the Bank's Guide to Procurement.

Statut

Signé - 2/09/2024