The Ugandan government is implementing a 2 500km national data transmission backbone, in a bid to bring ICT infrastructure to the East African country.
The government has secured a $106 million concessional loan, with a 2% interest rate payable over 20 years, with a grace period of five years, from the Chinese government.
This loan comes as result of a state visit by Chinese prime minister Hu Jintao, who came to Uganda last year in May, while on his African tour.
This is according to Edward Baliddawa, chairman of the newly-formed Parliamentary ICT committee overseeing the fibre optic backbone implementation.
MTN, UTL concerned
The national roll-out, however, has been met with concern from existing telecommunication operators MTN Uganda and Uganda Telecom (UTL), which recently installed fibre optic backbones on a separate basis.
According to an article posted on a Ugandan ICT development networking Web site, I-Network, MTN and UTL believe the implementation will be a waste of millions of dollars as it will duplicate existing fibre networks.
Noel Meier, CEO of MTN Uganda, explains the government's move to establish a national fibre optic backbone is surprising, considering it has repeatedly pressed operators to make use of infrastructure sharing arrangements in the past.
MTN Uganda and UTL have a five-year duopoly to implement fibre optic infrastructure to 80% of the country.
Government responsibility
Baliddawa says while the Ugandan government commends MTN and UTL for taking the initiative to lay fibre in some parts of the country, it feels strongly that providing infrastructure in the country remains government's responsibility.
"Once the national backbone is in place, it will be a matter of hooking up to Eassy, through Kenya," says Baliddawa. "Uganda has keen interest in the establishment of the Eassy cable, which will offer an international gateway for our traffic.
"At the moment, all our international traffic is transmitted via VSATs, which is still an expensive way of transmission."
The backbone will be built and owned by government, but will be used by both public and private consumers, explains Baliddawa. Once completed, a special purpose vehicle will be created to lease out the lines in the backbone to whoever is interested.
"The rates will be monitored by the telecoms regulatory body, Uganda Communication Committee, to ensure reasonable fees."
There are three implementation phases: the first phase will cover Kampala Bombo and Entebbe Mukona, finishing by mid-June. The whole project is envisaged to be completed by the end of 2008.
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