James BOND

Director, Energy Mining Telecommunications, The World Bank

Your Excellency Mr. Minister,

Mr. Executive Secretary,

Mr. Director,

Excellencies, Ladies and Gentlemen, friends

¨ You can imagine the great pleasure it gives me, on behalf of the World Bank Group, that we were able to come together with other partner organizations to look at global connectivity in Africa: the UNECA, which has spearheaded the Africa Information Society Initiative, the Telecommunications Development Bureau of ITU which has been a strong supporter of African connectivity over the years, and with our colleagues from the African Development Bank.

¨ The people who are here today include ministers, telecommunications regulators, private promoters of satellite and cable projects, African telecommunications operators, user groups, NGO's and donors and international organizations.

¨ We are delighted to have been able to support this event: through the Bank's Economic Development Institute (EDI) - and in the form of inputs from Bank Group staff. I must mention too, that this event was also made possible by a grant from infoDev. Indeed, the conference is the result of a long march which started a couple of years ago, as discussions between infoDev, ECA and ITU, with the private sponsors of a number of connectivity projects for Africa. In this regard, you will be hearing more about infoDev in the context of the year 2000 problem.

¨ It's simple: Africa is on the move, and telecommunications is leading the way. The Bank is assisting its clients on major telecoms reforms in 25 countries in Africa - more than half the entire continent. This movement relates to policy reforms, regulatory capacity building, and privatizations, which have led to such spectacular results in the last two years. Today the astounding statistic is that 3 out of every 4 lines in Africa are private.

¨ The reason why so many countries have undertaken these reforms is because policy makers have seen the powers of communication. For countries, being "plugged-in" is essential to economic competitiveness, and connectivity is one of the most potent ways to reduce isolation and exclusion of the poor.

¨ On the economic competitiveness front, no country can afford to be without efficient, reliable, cheap communications. The challenge for Africa is to set in place the broadband pipes which will provide the links to the rest of the world as cost-effectively as possible -- it's not enough to have an international dial tone, it needs to be cheap, it needs to be high-quality, and it needs to work every time.

¨ As concerns communications for the rural and urban poor, there is a large overlap between the 75% of the world's population who have no access to telephones in any form, and the 3 billion people who live on less that $2 a day. New, cost-effective technologies like wireless local loop and community information centers can bring information, contact, and new opportunities for employment to the poor. Here the challenge for Africa is to raise the connectivity rate from today's level of 5 lines per thousand inhabitants to, say, 5,10, perhaps 15 per hundred. China was able to do it; China today has a penetration of 8 lines per hundred, up from African levels just a few years ago and quadrupling every decade.

¨ The technologies exist: and frankly, they're not very expensive. From later this year, it will be possible to make a call from every point on the African continent, to anywhere in the world, with a handheld terminal. Initially it won't be cheap, but the technology problem has been solved. The barrier to universal access has moved away from infrastructure and technology, to economics, regulation, and market structure. The challenge for the African continent, for us all here today, is how to provide both cost-effective global connectivity, and access for the poor. And the challenge is how to harness the enormous creativity and the financial clout of the private sector, to roll out broad bandwidth global connectivity that does not leave the poor out of the loop.

¨ We will mostly be focusing on the global aspect of the challenge over the next three days, rather than access for the poor. But we must remember that the two are inextricably linked, and are part of the same endeavor. Having great links to the rest of the world will be useless if no-one has a line to be able to call out from the continent; and we must remember that the cash flow to pay for the new links will come from people in communities that today don't yet have a connection.

¨ The new technological and economic solutions in African telecommunications will be firmly rooted in the creative energies of the continent itself. You will remember that in February of this year, 11 African Heads of State met in Kampala, under the patronage of President Museveni. This meeting focused on African reform, and on political leadership in Africa by the Africans themselves. The President of the World Bank Group, Mr. Wolfensohn, called on these African leaders to set the agenda for reform, and he committed the Bank Group to support them. This theme of African leadership was echoed by Deputy President Thabo Mbeki and Minister Jay Naidoo -- who we have the honour of having amongst us today -- in Johannesburg earlier this month,at the ITU Africa Telecommunications Conference. This heralds an "African Renaissance", and telecommunications is leading the way.

¨ Clearly, we see thee enormous development potential of telecommunications:

R it provides a spur to growth,

R exceedingly attractive for private investment,

R it will lead to vastly improved delivery of services,

R it will reduce isolation and exclusion of the poor, and

R it will help Africa to participate and compete in the global economy.

¨ We have been approached by many of the promoters of these global projects, some for advice, some for funding. In addition, our client countries are asking for help in how to structure their sectors to accommodate the potential benefits, and make the choices which are required. Let me just say a brief word about our role in all of this.

¨ First, the Bank Group does not seek to select winners. The choice of which projects will move ahead belongs to Africa, not the World Bank. It is a very positive, and recent, development that Africa has such choices available to it. In the past, people had a woefully short list of options to choose from: access was difficult, tariffs re high, competition was not allowed. But this has all changed.

¨ Next, we see the choices of which technology will be used will be made largely by investors and operators. The public interest will be safeguarded by government --through the terms and conditions of the authorizations to provide service, and

broadly -- through independent and efficient regulation of the sector.

¨ So, what will the focus of the Bank be? Our focus will be to work with our client countries to:

- create the conditions which will allow this technology to be deployed

- ensure that it is done in a way which supports the wider development priorities in countries in countries(poverty alleviation in particular)-

- develop the capacity to allow each country to analyze and choose between the options proposed to it

- ensure that the smaller, more remote countries are also part of the system

- make sure that the interests of the most disadvantaged communities are taken into account

- work to better understand and deal with the concerns of governments and stake holders in undertaking the reforms needed to make use of the technology.

Now, I am sure you've all come here wondering if the World Bank will be financing the Africa connectivity projects we'll be discussing over the next three days. The definitive answer is maybe -- but only if we're absolutely needed.

• Long-distance communications are inherently very profitable, and these global connectivity projects should be no different. We expect that most of any financial requirements can come from private sources

• If the Bank Group is to be involved, our participation will come in the first instance from IFC and MIGA.

• Financing from ABRD and IDA might then be envisaged, under the following circumstances:

- we would need to see a clear development impact

- the project would need to be selected through an appropriately competitive process, and privately financed and operated as far as possible

- the project would need to be an agreed development priority between the relevant client government and the Bank

- and of course, it would need to fit our IBRD/IDA financial instruments.

But I commit to you that we will be around to help make it happen. But we won't be part of the financing unless we're absolutely needed.

But enough discussion of the World Bank Group. We are all here today to look at the options for Africa to be plugged in and part of the global electronic community.

Ladies & Gentlemen,

Cheap bandwidth, broad access, the two sides of the same development coin. I look forward to the next three days of discussion, and I Thank you for coming here today.