Port au Prince, Haiti, April 30, 2010
—IFC, a member of the World Bank Group, announced that Haiti’s government and central bank (Banque de la République d’Haiti -BRH) have signed an agreement with Vietnam’s largest mobile telephone operator Viettel for $99 million, Haiti’s largest foreign direct investment after the earthquake.
The investment will expand telecommunications services amid Haiti’s reconstruction efforts, including building the country’s first fiber optic cable network.
Under a public-private partnership structured by IFC, Viettel will initially invest $59 million, and an additional $40 million over four years, to upgrade services offered by fixed line operator Télécommunications d’Haiti S.A. (TELECO), creating a new company in which Viettel will hold a 60 percent stake and BRH, TELECO and their affiliates will control the remaining 40 percent.
IFC served as the advisor to the Haitian government in structuring the international bidding process for the partnership since June 2007. It is expected to make a significant contribution to the country’s recovery by rebuilding much-needed infrastructure and increasing Haitian’s access to fixed, mobile telephone services, as well as high-speed Internet.
Lars Thunell, IFC Executive Vice President and CEO, noted: ““The agreement reflects the extraordinary commitment of the Government of Haiti and Viettel to ensuring a safer and more sustainable future for the Haitian people. Economic growth is easier to achieve when people have the basic tools they need to communicate and connect with the world."
Viettel’s investment comes at a critical time. Even prior to the devastating earthquake on January 12, Haiti’s fixed-line penetration was only 1.8 percent—the lowest in Latin America and the Caribbean. Mobile density was emerging at around 35 percent while Internet penetration remained below 1 percent. The earthquake caused significant damage to existing telecom operators’ networks, including those of TELECO and other local providers.
“Enhancing telecommunications infrastructure at this time is an essential component of Haiti’s reconstruction efforts,” said Charles Castel, Governor of BRH. “We welcome Viettel’s commitment which shows confidence in Haiti and sends a signal to other potential private investors who want to support the country’s recovery and development.”
IFC worked closely with Haiti’s Council for the Modernization of State-Owned Enterprises, which acted as the project’s implementation agency on behalf of BRH and ensured the highest standards of transparency and fairness. IFC also coordinated with the World Bank, which was conducting a reform project to improve the regulatory environment for telecom companies in Haiti.
IFC’s infrastructure advisory services in the TELECO project received donor support from DevCo, a multidonor facility affiliated with the Private Infrastructure Development Group. DevCo is funded by the United Kingdom’s Department for International Development, the Dutch Ministry of Foreign Affairs, the Swedish International Development Agency, and the Austrian Development Agency. Additional support for IFC’s advisory work was provided by the United States Treasury Department.
IFC’s strategy in Haiti focuses on catalyzing private sector development through direct lending and advisory services and leveraging donor support. Since 2000, IFC has committed $65.6 million to Haiti’s private sector. IFC’s strategy also seeks to promote job creation, increase access to basic services, and develop human capital. IFC has expanded its investment operations and advisory services in Haiti and opened a local office in 2008.
About IFC
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing capital for private enterprise, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $14.5 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis. For more information, visit
www.ifc.org
.
