Africa’s Comtel on track for 2006

Comtel, a proposed private regional telecommunications company, is on track to begin offering services in 2006, now that national telecommunications operators (NTOs) in 21 African countries have agreed in principal to harmonize regional tariffs and network interconnectivity, according to company officials.

In a due diligence report finished last week, the Common Market for Eastern and Southern Africa (COMESA), the driving force behind Comtel, said the NTOs have agreed to take the necessary steps to co-ordinate pricing and network infrastructure for the new telecom company. Harmonized tariffs and network interoperability has been seen as a major challenge to the formation of COMTEL.

COMESA is an organization based in Lusaka, Zambia, chartered accelerate Africa’s economic growth through increased trade.

The organization has received funding from the African Development Bank (ADB), responsible for financing development projects in Africa, to start the company, said COMESA Secretary General Erastus Mwencha.

COMTEL is the outcome of a study on telecom network interconnectivity and tariff harmonization undertaken by COMESA in 1998, after the organizations’ officials realized that tariffs in the region were high because of the poor state of communications infrastructure in Africa.

“The formation of this company is a practical solution, among other possible solutions, to ailing telecommunications in Africa,” according to Mwencha. “COMTEL is going to interconnect with NTOs in all the 21 countries. This means that communication will be at reduced tariffs regardless of the country you are (in), but as long as you are in any of the 21 countries.”

Comtel’s network, Mwencha says, will facilitate transmission of voice, data of various bandwidth, Internet and television programs.

Although the network is based on Asynchronous Transfer Model (ATM) technology, COMTEL will select appropriate network elements on a country-by-country basis, according to Mwencha. The network will be built on existing infrastructure where available, he said, but new transmission routes will employ a mix of fiber-optic cable, digital microwave and satellite systems. Some of pieces of the network have yet to be constructed in some countries.

“COMTEL will be connected to four satellite stations in four different countries,” Mwencha said. “Undersea fiber optical cables will also be laid down that will connect Africa to Europe. So any country in Africa is free to join COMTEL and lessen the communication problems,” he said. The satellite stations will be in the Democratic Republic of Congo, Comoros, Madagascar and Seychelles.

To prepare to offer service, COMTEL has signed on shareholders and a board of directors. Shareholders include NTOs from the 21 countries (among them, Zambia, Zimbabwe, Egypt, Madagascar and Mauritius) and a strategic equity partner, Anderberg International Inc.

The NTOs will hold 25 per cent of the company, Anderberg will have 30 percent, and private investors will have 45 per cent.

Provisional funding of about US$215 has been secured to finance network construction. However, the NTOs still need to finance their equity stakes in the company, and only 10 of them have actually signed the shareholders agreement.

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