Johannesburg - African countries hope to launch a submarine cable to slash the cost of phone calls and internet access by early 2008 and will defy private sector investors looking for big profits by regulating tariffs.
Communication ministers from 15 countries in southern and eastern Africa said on Tuesday they had agreed to speed up
long-delayed plans for the Eastern Africa Submarine Cable System (EASSy), which will link the east of the continent to the rest of the world.
Bickering over cost
The project - which could cut internet costs from $15 000 per megabyte to as little as $500 over five years - has stalled
due to bickering between South Africa and Kenya over funding, and arguments about how much access to the cable would cost.
"Most of us needed this cable as fast as yesterday," Kenyan assistant information and communications minister David Were told reporters.
High telecom costs are impeding investment in the world's poorest continent, particularly in countries like Kenya, which are keen to nurture call centre outsourcing industries.
Ministers agreed telecom operators would manage the project but that access tariffs would be regulated to ensure shareholders did not make excessive profits - a clause that could deter investors.
"Shareholders will recover their costs and get a return on their investment but tariffs will be regulated to keep costs low," said Henry Chasia, executive deputy chairperson of the Nepad e-Africa commission.
The Nepad e-Africa commission is the communications arm of Africa's homegrown recovery initiative - the New Partnership for Africa's Development (Nepad).
South Africa's fixed-line phone company Telkom told Reuters on Monday it would not invest in EASSy unless it was
Telkom has fought plans to force investors in a similar SAT-3 cable in western Africa to cut inflated tariffs and threatened not to invest in EASSy.
Frustrated by delays
The planned 9 900km fibre optic cable will run from Durban in South Africa to Port Sudan in Sudan with six landing points on the way.
Frustrated by delays to the project, Kenya had threatened to break away from the Nepad plan and build its own cable. But
Were told Reuters that plan had been put on hold to give time for the new agreement to work.
"If it takes longer than we are planning - which we don't expect - and if we realise mid next year that we are behind, then I think we are justified in going ahead alone," he said.
Chasia said the cable would cost around $280m, but that would rise to $300m including an extension to the Indian Ocean island
He said the World Bank had agreed to provide around $170m in debt if certain conditions were met and that private sector funding mainly from Africa would meet the shortfall.
The cable was expected to be operational in the first quarter of 2008, and terrestrial links to landlocked countries would be
finished by the end of 2008, Chasia said.