Japanese Banks Sign Agreements for Funding South Atlantic Cable System


South Atlantic Cable System (SACS) had passed another milestone when the Development Bank of Angola (DBA) signed loan agreements with Japanese firms this week. SACS, the submarine fiber optic cable that connects South America with the African continent is Angola’s hope for international bandwidth. The Japan Bank for International Co-operation (JBIC) and other banks will provide the necessary funds to construct the submarine fiber optic cable system across the Atlantic ocean. Japanese firm NEC will construct the cable system.

Angola hopes to become an internet hub in the continent by getting international connectivity through various submarine fiber optic cable systems. Many submarine fiber optic cables connecting Europe to South Africa and Asian countries have landing stations in Angola. By connecting Angola to Brazil with SACS, Angola has the potential to turn into an internet hub in the future. The Development Bank of Angola (BDA) has signed $109.7 million loan agreements with Japanese firms.

The agreement is backed by a guarantee from the Angolan government. The two-stage loan program that will fund the cable system involves the presence of Japan Bank for International Co-operation (JBIC), Sumitomo Mitsui Banking Corporation (SMBC), Nippon Export and Investment Insurance (NEXI) to finance the first stage of the cable deployment. The second stage of the loan program includes agreements between BDA and Angola Cables. Angola Cables is the owner of the SACS. Angola Cables is a Public-Private Partnership, the shareholders of which include Isabel dos Santos’ Unitel Telecom Company and Angola Telecom.

JBIC will release $65.8 million and SMBC will lend $43.9 million, while NEXI provides insurance to SMBC for the loan. The total project cost is estimated at US$300 million to link Luanda in Angola with the city of Fortaleza in Brazil. SACS is the first submarine fiber optic cable system that will connect the African continent to South America. In order to meet growing demand from broadband, mobile, broadcasting, and enterprise traffic crossing the South Atlantic, SACS will feature the latest high-quality 4-fiber-pair cable and optical transmission technologies with an initial design capacity of 40Terabits per second (100Gb/s x 100 wavelengths x 4 fiber-pairs).

The submarine fiber optic cable system will land at Sangano cable landing station in Angola, near the capital city of Luanda, and in a data center in Fortaleza, Brazil, which, will be built for the cable systems that are under construction by Angola Cables. Angola Cables recently announced the construction of another cable system, COTA (Cable Of The Americas) connecting Santos and Fortaleza in Brazil to Miami in the USA. By constructing different undersea cable systems, Angola Cables hopes to connect Angola and Africa directly to Brazil and the USA through SACS and COTA. The interconnectivity of continents will make Angola an important hub for telecommunication customers worldwide.

Angola has one of the highest telecommunication costs on the continent. The Angolan authorities see the potential to help lower telecommunication prices in Angola. Angola Cables is a member of the West Africa Cable System (WACS), which owns submarine optical cable linking South Africa and the United Kingdom, routing via different landing points in Africa and Europe.

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