One June 28, 2018, MIGA agreed to issue $114.76 million in guarantees covering non-shareholder loans from Industrial and Commercial Bank of China (Asia) Limited for the Second HyalRoute Fiber Optic Cable Network Project in Myanmar. The guarantees are issued for up to five years against the risks of transfer restriction, expropriation, and war and civil disturbance.
This second fiber optic cable (FOC) project involves the construction of an additional 4,000 km fiber optic cable network in Myanmar by Myanmar Fiber Optic Communication Network Co., Ltd. In January 2017, MIGA-supported the first project, which constructed 4,500 km of FOC, completed in October 2017. The total investment for the project is estimated at $119 million, including $19 million in equity from Hyalroute Communication Group Ltd. and $100 million in debt financing from the international lender to be determined. The project is expected to start construction in June 2018.
The project is a category B under MIGA’s Policy on Environmental and Social Sustainability. Click here to view the Environmental and Social Review Summary.
The project’s major expected development impact is the improvement of the telecommunications infrastructure sector and promotion of economic growth in Myanmar. The construction of the fiber optic cable as part of the national network is expected to: increase access to telecom services in urban and rural areas; provide additional tax revenues for the government; and boost economic activity and employment opportunities, directly and indirectly, during the construction and operational phases. The project is in line with the Government of Myanmar’s Telecom Master Plan (2016-2020), which promotes fiber optic cable network development and foreign direct investment in the telecom sector.
MIGA’s proposed support for the investment is aligned with the agency’s priorities of supporting investments into countries eligible for financing from the International Development Association (IDA) and countries affected by conflict (FCS).