News Interactive
From Correspondents in Kabul
September 5, 2003,4057,7173331%255E15306,00.html

Afghanistan seeks telecom investors

AFGHANISTAN needs $US300 million ($467 million) private investment over three years to transform its fledgling telecoms sector into a countrywide network, according to telecom minister Mohammad Massoum Stanakzai said.

Mr Stanakzai said the private sector had already shown strong interest in the country's telecoms industry, which was virtually pulverised into non-existence during decades of conflict.

"Even in the first year, private sector investment is 50 per cent more than the public sector investment. It means that we have made some strong steps to attract the foreign investment in this country," he said.

"The private sector investment by the end of this year will reach up to $US94 million.

"And for the coming two to three years we are predicting up to $US300 million private investment" in telecoms.

Private sector involvement was critical to tap into international experience for the rapid development of telecoms, World Bank country manager William Byrd said.

"During the last 25 years or so, when Afghanistan was at war, the world has undergone a telecommunications revolution and this gives both an opportunity to Afghanistan to catch up very quickly with all the developments but also a big burden of work to do," he said.

With limited fixed line and mobile coverage, Afghanistan has a lot of catching up to do.

The country has just 26,800 digital fixed lines serving the capital Kabul and the main cities of Herat and Kandahar in a country with a population of around 24 million - two million of those people in Kabul alone.

Mr Stanakzai said the government planned to expand the digital network, with the first bidding for a project covering 87,000 lines for 12 of the country's 32 provinces concluded last week.

"We are still hoping that by the end of this year we will get more support to expand the digital telephone system throughout the provinces in Afghanistan," he said.

France's Alcatel is also conducting a feasibility study on a national fibre-optic network which could be built alongside reconstruction of the country's roads, he said.

Kabul has also just concluded negotiations with the World Bank on a three-year project which would include a government satellite Internet network to cover the whole country.

"The aim is to provide connectivity and also access to information to all Afghans," he said of the ambitious plans for a country where only six percent of the population even has access to electricity.

"By the end of 2004 we are targeting that all the districts in Afghanistan should be connected to the centre and also to outside Afghanistan."

Afghanistan's telecommunications sector has already opened up to private and international investment.

Since July, Afghanistan's first commercial mobile operator, Afghan Wireless Communications (AWCC), has faced competition from Roshan, operated by Telecom Development Company of Afghanistan (TDCA).

TDCA has said it plans to invest $US120 million over the next decade in expanding Roshan across Afghanistan, with 55 million earmarked for its first phase to connect Kabul and five major cities by next year.

TDCA is owned by an international consortium in which the Aga Khan Fund for Economic Development holds 51 per cent, Monaco Telecom International 35 per cent and US-based MCT 9.0 per cent. Alcatel holds 5.0 per cent and also provides financing for equipment.

Mr Stanakzai said work was also underway on restructuring the communications ministry and setting up a regulatory body which would eventually be independent.

The first draft of a telecommunications law had been prepared and would shortly be forwarded for cabinet approval, he said.

Agence France-Presse