Manila, Philippines, August 3, 2022—More people and businesses in the Philippines will have affordable and better mobile connectivity through a US$70 million financing package arranged by IFC for Communication and Renewable Energy Infrastructure (CREI) Phils Inc., aiming to bridge the digital divide through shared mobile infrastructure. The US$70 million financing package consists of a US$25.5 million loan from IFC and a parallel facility of US$44.5 million.
IFC's investment will allow CREI Phils, a new tower company in the Philippines, to fund the construction of over 600 new towers by next year. For the first time in the country, these towers will be shared under 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 and offer better services at 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, said 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."
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org .
About CREI Group
Communication & Renewable Energy Infrastructure ("CREI") is an established asset management company of a portfolio of telecom and renewable power assets across Africa and South-East Asia. CREI is part of a global telecom infrastructure group, TwoThirtyThree Group (the "Group"), that also builds, supplies, manufactures and provides maintenance services for telecom towers and power infrastructure assets. The Group was founded in 2007 and is currently present in 23 countries across Africa and Asia, managing a portfolio of 23,000 sites and has built more than 7,000 sites. CREI's main activities entail providing sustainable energy and reliable connectivity to Mobile Network Operators ("MNOs") and rural communities across developing countries. With the expertise and synergies created through its Group, CREI covers an integrated approach and is identified as a one-stop shop for operators and investors. CREI manages a portfolio of Telecom ESCO, TowerCo and Network as a Service (NaaS) assets with the aim to help MNOs decrease their carbon footprint while efficiently increasing their network reach.