The International Finance Corporation (IFC) announced that it is providing $70 million to fund a shared mobile infrastructure project in the Philippines.
In a press release, the organization said it is collaborating with Renewable Energy Infrastructure (CREI) Phils Inc. to help address the digital gap in the country through tower-sharing.
The $70 million financing package consists of a $25.5 million loan from IFC and the provision of a facility worth $44.5 million.
IFC's investment will allow CREI Phils, a newly formed tower company in the Philippines, to fund the construction of over 600 w towers by next year. For the first time in the country’s history, these towers will be shared on an open-access basis. Aside from creating a competitive market for tower colocations, the loan will help increase mobile network capacity, allowing operators to expand high-speed mobile networks (4G and 5G) across the country, offering better services at more affordable rates.
According to the 2020 Global Digital Overview, the number of internet users in the Philippines has more than tripled from 23 million (2010) to 73 million (2020). Yet, the quality of mobile connectivity is inadequate given its pervasive network congestion. The country ranks 95th out of 142 countries for mobile internet download speed. Further, the number of mobile subscribers per tower – a measure of network congestion – is more than double the regional average. According to market estimates, to fill the gap, the Philippines would need a significant number of new towers built in the next seven to eight years to support the government's network capacity requirements.
"We are thrilled to be working alongside IFC in supporting the government of the Philippines' development of its mobile infrastructure sector,” stated Kadri Hakim, CEO of CREI. "Despite the challenging market conditions triggered by the pandemic, IFC's long-term funding will allow us to meet our ambitions of expanding our digital infrastructure portfolio in the Philippines. Our management team's extensive knowhow gained through 15 years of telecoms operations across South-East Asia and Africa combined with IFC's deep knowledge of the country's telecoms regulatory regime and its experience as an investor in tower companies, will enable us to effectively develop and grow our operations in the country."
The company's entry into the Philippines telecoms market brings robust expertise in the design, construction and operation of towers, as well as the provision of efficient energy solutions that help displace and reduce the use of diesel fuel on towers connected to the grid. In line with the nation's climate goals, this project will lead to significant greenhouse-gas (GHG) savings. IFC will also assist the company align its environmental and social practices with IFC's performance standards.
"Digital connectivity is more important than ever for businesses and people to thrive," said Jean-Marc Arbogast, IFC Country Manager for the Philippines. "By supporting the entry of a new company, IFC's investment will contribute to a strong independent tower market in the Philippines, increasing competition, creating jobs, spurring economic growth and help cut emissions."