The World Bank Report No: ISR12288 Implementation Status & Results Africa Central African Backbone - APL2 (P117652) Public Disclosure Copy Operation Name: Central African Backbone - APL2 (P117652) Project Stage: Implementation Seq.No: 5 Status: ARCHIVED Archive Date: 19-Jan-2014 Country: Africa Approval FY: 2011 Product Line: IBRD/IDA Region: AFRICA Lending Instrument: Adaptable Program Loan Implementing Agency(ies): Key Dates Board Approval Date 20-Jan-2011 Original Closing Date Planned Mid Term Review Date 28-Feb-2013 Last Archived ISR Date 23-May-2013 Effectiveness Date 06-Jul-2011 Revised Closing Date 31-Dec-2014 Actual Mid Term Review Date 14-Jun-2013 Project Development Objectives Project Development Objective (from Project Appraisal Document) The development objective of the proposed project is consistent with the PDO for the CAB Program: To contribute to increase geographical reach and usage of regional broadband network services and reduce their prices in the territory of São Tomé and Príncipe. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost Component 1 - Enabling environment 1.10 Component 2 - Connectivity 13.30 Component 3 - Project Management 0.50 Overall Ratings Previous Rating Current Rating Public Disclosure Copy Progress towards achievement of PDO Satisfactory Highly Satisfactory Overall Implementation Progress (IP) Satisfactory Satisfactory Overall Risk Rating Moderate Moderate Implementation Status Overview As of December 2013 CAB2 STP project has disbursed 96% out of the total amount of $14.9 million of project funds. All payments to the ACE consortium now completed and the submarine cable is in operation and was commercially launched in February 2013. The use of capacity has gone from 50Mbs before the cable to 300Mbs in June 2013 and to 456Mbs n December - ie, the use has so far gone up 9 times when compared to the situation before the cable and it can still go up 10 more times before an upgrade is needed in cable capacity. Average prices are already coming down (the operator is offering 4-8 times more capacity for the same price) and CST has launched lower end ADSL and mobile services in October 2013, which allow lower income consumers to pay 10-30 times less for a lower quality service (more limited speed and traffic) - this is likely also driven by the Page 1 of 5 The World Bank Report No: ISR12288 entrance of the second operator expected later in 2014. The government has successfully awarded a second telecommunications global license in May 2013 to UNITEL International Holdings, and the legal deadline for the start of operations is May 2014. While initially the second operator indicated it may become operational by 2013 year end, it has now delayed the expected date to first semester of 2014. As Public Disclosure Copy part of the package for the second license the government has sold the whole 24.5% government participation in STP-Cabo, having fully divested from the cable - Government keeps however one single share - a golden share, that gives it the right to veto any chances to the companies main operating principles, such as a possible change of the open access principles. Through the project Government has also developed an options study to look at the best manner of upgrading the existing connection with Príncipe island. In the short term the two operators are going to setup their own microwave links with higher capacity - this should happen by June 2014. In the medium term Government is pursuing opportunities to develop the submarine connection to Principe by piggy-backing on: (i) the return of the ACE boat to install Segment 4, and/or (ii) by coordinating with the authorities of Equatorial Guinea, who plan to build submarine connection from Malabo to Annabon - the project could be reconfigured at marginal cost to include Malabo-Príncipe-(São Tomé)-Annabon. A financial contribution would be needed, and this could possibly be obtained by aggregating investment from the two operators, other investors like HBD and oil companies operating in the country's territory, and Government, for example through the Universal Service Fund (USF) - no Bank funds are currently being envisaged for this. The mid-term review (MTR) for the project took place in June 2013. It was the opportunity to decide what would be the priority investments, to be structured on a PPP basis, going forward: both using project funds but also by using part of the funds received with the sale of the second license, and which Government had committed to reinvest in the sector and possibly any funds currently existing under the USF. Currently the projects that have been selected include: (i) connecting secondary schools to the internet (with CAB2 funds) and (ii) implementing 2-3 telecenters, (iii) distributing internet-enabled tablets, with pre-loaded school textbooks, to secondary schools students and teachers (funded through Government funds). A consultancy to work with government and the regulator (AGER) on legal and regulatory amendments needed to reflect the new sector reality (submarine cable and competition) is well underway. This consultancy also includes the development of regulatory and economic tools (cost models, etc) for issues like interconnection, as well as training in all of these aspects. The main milestones coming up over the next 6 months are (i) the conclusion of the legal and regulatory assistance to AGER (with approval/adoption of the new texts and tools); (ii) the launch of the tenders for connecting schools, purchasing/distributing tablets and implementing telecenters; and (iii) the approval an adoption of the ICT strategy. Locations Country First Administrative Division Location Planned Actual S.Tome,Principe Sao Tome Sao Tome ✔ Results Public Disclosure Copy Project Development Objective Indicators Indicator Name Core Unit of Measure Baseline Current End Target Access to Internet Services (number of Number Value 0.70 0.70 1.80 subscribers per 100 people) Date 01-Dec-2010 30-Jun-2013 31-Dec-2014 Comments Page 2 of 5 The World Bank Report No: ISR12288 Access to Telephone Services (fixed mainlines Number Value 67.00 81.00 78.00 plus cellular phones per 100 people) Date 01-Dec-2010 30-Jun-2013 31-Dec-2014 Comments Public Disclosure Copy International internet bandwidth Number Value 51.00 1898.00 500.00 Date 31-Dec-2007 30-Jun-2013 31-Dec-2014 Comments Unit of Measure: Bits per Unit of Measure: Bits per Unit of Measure: Bits per second per person second per person second per person Note that the value that had previously been indicated for Dec 2012 was wrong (shouldhave been '309'). Direct project beneficiaries Number Value 113900.00 134024.00 134300.00 Date 01-Dec-2010 30-Jun-2013 31-Dec-2014 Comments Female beneficiaries Percentage Value 50.50 50.50 50.50 Sub Type Supplemental Access to telephone services (cellular phones Number Value 63.00 76.00 77.00 per 100 people) Date 01-Dec-2010 30-Jun-2013 31-Dec-2014 Comments Average monthly price of wholesale Text Value US$9,000 US$2,500 US$4,500 international E1 capacity link from capital city to Date 01-Dec-2010 30-Jun-2013 31-Dec-2014 Europe Comments US$/month/2Mbps US$/month/2Mbps Intermediate Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Number of operators and service providers with Percentage Value 0.00 100.00 100.00 Public Disclosure Copy access to the Regional infrastructure deployed Date 01-Dec-2010 30-Jun-2013 31-Dec-2014 (ACE cable) Comments no cable. The submarine cable has Cable has landed and is gone into operation in Feb operational 2013. Retail Price of Internet Services (per Mbit/s per Amount(USD) Value 852.00 104.00 340.00 Month, in US$) Date 01-Dec-2010 30-Jun-2013 31-Dec-2014 Comments per Mbps monthly (USD) per Mbps monthly (USD) per Mbps monthly (USD) (640 euros/month) (80€/month) Page 3 of 5 The World Bank Report No: ISR12288 Increased access to ICT services: Percentage Percentage Value 56.00 70.00 100.00 of localities with broadband Internet access Date 01-Dec-2010 30-Jun-2013 31-Dec-2014 (256Kbps) Comments same value Public Disclosure Copy Mobile cellular price of a 3 minute local call Amount(USD) Value 0.42 0.40 0.20 (peak) Date 01-Dec-2010 30-Jun-2013 31-Dec-2014 Comments tender for the second operator has been launched and a license is about to be awarded, so next indicators should reflect that. Additional number of operators in the market Number Value 0.00 0.00 2.00 Date 01-Dec-2010 30-Jun-2014 31-Dec-2014 Comments The license has been awarded and the operator is due to be in operation in May 2014 Impact on Telecom sector of World Bank Number Value 0.00 5.00 4.00 Technical Assistance (composite score: 1- low Date 01-Dec-2010 31-Dec-2013 31-Dec-2014 impact to 5-high impact) Comments The cable has landed and is structured under open access. The second license has been awarded and just the prospect of competition is bringing results. Gov't has divestited from the cable. Data on Financial Performance (as of 01-Oct-2013) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date Public Disclosure Copy P117652 IDA-H6420 Effective 12-Jan-2011 24-Jan-2011 06-Jul-2011 31-Dec-2014 31-Dec-2014 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P117652 IDA-H6420 Effective XDR 9.80 9.80 0.00 9.44 0.36 96.00 Disbursement Graph Page 4 of 5 The World Bank Report No: ISR12288 Public Disclosure Copy Key Decisions Regarding Implementation The government will confirm its final choices on the projects to be financed with proceeds from sale of the second license by (i) making the funds available, (ii) eventually complementing them with USF funds. Restructuring History Level two Approved on 04-Feb-2012 Related Projects There are no related projects. Public Disclosure Copy Page 5 of 5