Presents the authors view of what the requirements for ICT network investments in the ECOWAS region are.

1. Requirements and challenges in developing
networks and infrastructure in rural areas in West
Africa
By:
Kolubahzizi T. Howard
Director of Strategy
Liberia Telecommunications
Authority
11-12 June 2013
Radison Blu, Dakar, Senegal

2. Outline
• Introduction
• Present status of the ECOWAS Telecom Sector
• Requirements for Infrastructure Investments
• Challenges for Infrastructure Investments
• Conclusion

3. INTRODUCTION

4. Introduction
• ICTs have been very successful in Africa over the past
decade driven by sector reform, resulting in improved
availability, quality and reduced cost of connectivity.
• Policy changes have triggered reforms and the way
telecom investments have been financed, making
telecommunications unique among infrastructure sectors
in Africa (Williams et al, 2011).
• 557.2 million (62.1%) Africans lived within the reach of a
GSM network as of 2006
• 340.7 million (37.9%) of inhabitants did not have access
to voice communications.
• 314.6 million (94%.0 %) of urban populations had access
compared with only 242.6 million (43.1 %) of rural
populations (Mayer et al, 2009).

5. Introduction
• From 1998 - 2008 $5 billion yearly on average has been
invested in Sub-Sahara Africa (1 %of total GDP). Most of
the investment comes from the private sector targeting
mobile infrastructure development.
• 60 % of this investment has gone to Nigeria and South
Africa. Countries promoting competition in the sector
and encouraged new operators to enter the market have
received higher levels of investments than countries with
limited competition.
• Despite the progress made in the mobile sector, other
sectors of the telecommunications market have not
developed as rapidly.
• The reform agenda on the continent is not complete and
there remain barriers to entry in sectors (Mayer et
al, 2009).

6. Introduction
Telecommunications Subscribers, Sub-Saharan Africa, 1998–2008

7. PRESENT STATUS OF THE ECOWAS
TELECOM SECTOR

8. Present status of the ECOWAS Telecom Sector
World Bank and ITU figures indicate the following:
• Between 1998 and 2008 the number of mobile users grew
more than 247 million, increasing mobile penetration rate
from less than 1% to almost 33%.
• For ECOWAS, during the same period, subscriptions grew
from 23,530 to 35,670,924.
• Nigeria and South Africa combined account for 43% of the
total number of mobile subscribers in Sub-Sahara Africa.
• At the same time the number of fixed lines increased from 1.4
subscribers per 100 in 2000 to 1.5 in 2007 and dropped back
to 1.4 in 2008, amounting to 16 million fixed-line subscribers.
Infrastructure Status

11. Present status of the ECOWAS Telecom Sector
Regulatory Status
• All ECOWAS countries have introduced new laws
and regulations covering telecommunications, with
the majority establishing National Regulatory
Authorities (NRAs) to implement rules governing
the sector and protect consumer’s interests.
• Effective regulations supportive of sustainable
investment requires regulatory independence in the
decision making process which must be non-
discriminatory, transparent, objective and free of
political influence.

12. Present status of the ECOWAS Telecom Sector
• 78% of the regulatory heads in Sub-Sahara Africa
are appointed by either: Heads of State, the
Legislature or a Council of Ministers. In some
countries sector ministers retain power to appoint
NRA heads, leading to increased political influence
over regulatory decisions (Williams et al, 2011).
• Private investment is contingent on a conducive
regulatory environment.
• While liberalization has spurred the ICT revolution
in Sub-Sahara Africa, the state of liberalization
across the region is incomplete.
• The process of liberalizing fixed-line markets has
not progressed much.

13. • Licensing regimes across the region are
gradually evolving from technology specific
licenses to service specific licenses.
• However, licensing restrictions in some
countries on terrestrial backbone networks,
international gateways and submarine cables
limit the size of operators’ networks, while
obstacles in obtaining rights of way and
outright monopolies continue to hinder
private investments (Williams et al, 2011).
Present status of the ECOWAS Telecom Sector

14. REQUIREMENTS FOR
INFRASTRUCTURE INVESTMENTS

15. Requirements for Infrastructure Investments
• Universal coverage of voice telecommunications - when
more than 98 % of the population lives within range of a
mobile telephone signal.
• Universal broadband coverage - when a land connection
for a public broadband facility (such as an Internet café)
is available within close proximity of more than 98 % of
the population.
• To ensure universal voice connectivity in Africa and
maintain the infrastructure requires annual investments
of 0.2% of the combined GDP of the 51 countries studied.
This translates to $2.1 billion annually or $18.7 billion
from 2007 through 2015 (Mayer et al, 2009).

16. In assessing the public funding gap for universal
coverage the total investment is divided into
two major categories:
• The efficient market gap: areas where full
coverage is commercially viable and likely to
be funded by private investment under
efficient and competitive markets; and,
• The coverage gap: areas lacking the potential
for full commercial coverage.
Requirements for Infrastructure Investments

17. The coverage gap is then divided into two
economic zones:
• The sustainable coverage gap: areas with
enough commercial viability to support
operating costs, but not capital costs, of ICT
infrastructure; and,
• The universal coverage gap: areas lacking
sufficient market viability to cover either
capital or operating costs.
Requirements for Infrastructure Investments

19. • It is expected that voice infrastructure will
cover more than 92% of Africa’s population by
2015 through private investments, dependent
upon the promotion of effective competition
and mobile private sector resources (Mayer et
al, 2009)
• NRAs must therefore ensure effective and
competitive regional and national markets in
telecommunications and services.
Requirements for Infrastructure Investments

26. CHALLENGES FOR INFRASTRUCTURE
INVESTMENTS

27. Challenges for Infrastructure investments
Major challenges to increasing infrastructure investments in
West Africa include the following:
1. Completing the sector reform agenda by revising
existing laws to establish full competition to drive
network expansion into the rural areas and boost the
development of more advanced segments of the
market;
2. Ensuring that NRAs are institutionally and financially
independent of both government and the sector and
that their legal powers to implement regulatory
decisions are strengthened;
3. Revising licensing frameworks to accommodate new
market entrants in all market segments and promoting
rapid technological change and competition. This
requires reasonable license prices and licensing
conditions;

28. 4. Shifting government’s responsibilities away from the
ownership and management of network operators to
the development of enabling legal and regulatory
environments for the growth of the sector;
5. Using government finances to develop competition,
ensuring cost based wholesale pricing and reserve
capacity for potential new entrants;
6. Provisioning low-cost international access
infrastructure by preventing monopoly control over
bottleneck facilities such as terrestrial backbone
networks, international gateways and cable landing
stations;
7. Promoting high-bandwidth backbone infrastructure
development through removing licensing restrictions
and the introduction of new private sector operators;
Challenges for Infrastructure investments

29. 8. Stimulating innovative use of wireless technologies by
restructuring spectrum allocation and management to
increase competition;
9. Improving spectrum management through increased
investments in systems and resources to increase the
amount of spectrum available for broadband;
10. Promoting universal access to ensure extensive
ICT/telecommunications availability through
innovative approaches that provide direct incentives
to operators to provide service in rural areas;
11. Identifying new partnerships and new sources of
funding and maximizing the potential of existing
infrastructure funding mechanisms; and,
Challenges for Infrastructure investments

30. 12. The continued capacity building by NRAs to sustain
their professional and institutional capacity to meet
the challenges of the rapidly evolving
telecommunications regulatory environment.
Challenges for Infrastructure investments

31. Relationship between Effective Regulation and Investment in
Telecommunications
Source: Impact of Effective Regulation on Investment, European Competitive
Telecommunications Association (ECTA) ICT Regulations Toolkit Section 2.1

32. CONCLUSION

33. • The region has made significant gains in
ICT/telecommunications sector development, but
more needs to be done to increase
network/infrastructure investments.
• The sector reform agenda must be completed to
create the required enabling competitive
environment that attracts sustainable private
investments.
• NRAs must regulate effectively. Without effective
regulations private sector investments are stifled.
• Governments must provide the funding to meet
the universal coverage gap to provide access to
all inhabitants.
Conclusion

34. REMEMBER!
Let’s develop an information society within the ECOWAS
region - promote both private sector investments and
public funding of ICT network infrastructure for our rural
inhabitants.

35. THANK YOU FOR YOUR ATTENTION