DEG finances mobile communications infrastructure in Myanmar

• 19,8m US-dollars for Irrawaddy Green Towers Ltd.
• Mobile access for around 14 million people
• 1,300 new jobs

DEG - Deutsche Investitions- und Entwicklungsgesellschaft mbH, provides a long-term loan to the amount of 19.8m US-dollars to Irrawaddy Green Towers Ltd. (IGT) for installing and operating mobile telecommunication towers. The total investment, arranged by the Dutch development finance institution FMO, amounts to 122m US-dollars. Other European development finance institutions such as CDC Group (Great Britain), PROPARCO (France), OeEB (Austria) and BIO (Belgium) are further investors.

In 2014 only 14 % of the approx. 51 million inhabitants of Myanmar had access to mobile telecommunication services. This share has increased to 40 % and is expected to rise to 75 % in 2016. The development of the necessary infrastructure for a countrywide mobile network is supported by private operators such as IGT. The company, which was founded in 2014, intends to invest a total amount of 230m US-dollars.

In Myanmar, IGT will build a mobile telecommunication tower network consisting of 2,000 towers, thus providing coverage to approximately 14 million people. Since its foundation, IGT has created 320 direct jobs. Another 1,000 indirect jobs will be created in relation to the erection and operation of the towers. The company offers a comprehensive range of training and qualification programmes for its staff and, in doing so, provides an important contribution to the transfer of technical and economic know-how.

Mainly in rural areas the expansion of mobile networks can provide a significant stimulus for economic development, i.e. by improving access to mobile financial services and service offers. It is also intended to improve the framework conditions for foreign investments.

Financing and providing advice to companies that invest in future markets such as Myanmar is part of DEG’s core business. Long-term financing is often not available in these countries. The financing for IGT is the first commitment of DEG in Myanmar. Using funds from the Federal Ministry for Economic Cooperation and Development’s (BMZ) develoPPP.de programme, DEG had already financed programmes to train workers in the textile industry in the country.

As a pioneering investor in countries with weak infrastructure, DEG has been accompanying many investments in the telecommunications sector: In 2001, it for example, it made an investment in Africa’s first network provider Celtel. DEG’s current mobile communications portfolio amounts to EUR 234m and includes 11 investments mainly in Africa, but also in Africa and Eastern Europe.