The International Finance Corp. (IFC), the private-sector lending arm of the World Bank Group, has extended a loan that aims to help improve mobile connectivity in the Philippines.
The loan is part of the $70-million financing package arranged by IFC for Communication and Renewable Energy Infrastructure (CREI) Phils. Inc.
The financing package, which aims to bridge the digital divide through shared mobile infrastructure, includes a $25.5-million loan from IFC and a parallel facility of $44.5 million.
“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’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 collocations, 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 to 73 million in 2020, from 23 million in 2010. However, the country ranks 95th out of 142 countries for mobile internet download speed.
IFC said 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.
“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,” Kadri Hakim, CEO of CREI, said.
“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 Philippine 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 savings. IFC will also assist the company align its environmental and social practices with IFC’s performance standards.