Cable links in jeopardy over government conditions

11 Sep 2007

South Africa’s Communications Minister, Ivy Matsepe-Casaburri, has confirmed that no undersea cables will be allowed to land in the country unless they are majority owned by local investors. The condition may jeopardise the future landings of two planned undersea cable projects, Seacom and EASSy (East Africa Submarine System). The first of these, which will link Europe and Africa, is part-owned by South Africa’s second national operator, Neotel, but it does not have a majority stake in the project. EASSy’s investors include three South African firms – Telkom, Neotel and MTN – but together they own 27%; again, not enough to give full control.

Matsepe-Casaburri has still to clarify whether ‘local investors’ means just South African firms or any African-owned company. Local newspaper Business Day reports that the Minister believes that another planned undersea link, the NEPAD system, which will connect South Africa with Europe and Asia, will be sufficient to meet the country’s bandwidth needs. The owners of Seacom say South Africa’s stance may put the entire future of the project in doubt. African countries are looking to improve international bandwidth to bring more affordable broadband internet services to consumers.