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Orange Bissau S.A.

$25.9 million
Project Brief

MIGA has issued guarantees totaling $25.9 million to Société Nationale des Télécommunications du Sénégal S.A. (Sonatel), covering its $13.6 million equity investment and $12.2 million shareholder loan in Orange Bissau S.A. The ten-year coverage provides protection against the risks of transfer restriction, expropriation, war and civil disturbance, and breach of contract.

The project involves the installation, operation and maintenance of a 900/1800 GSM cellular network in the country, as well as public pay phones and internet services—critical to Guinea-Bissau’s economic development. It will be the second major cellular service provider in Guinea-Bissau to operate on a 100 percent digital GSM technology.  This will improve quality, efficiency, and provide for a reliable mobile telephone technology. Subscribers are expected to benefit from reduced costs due to increased competition and the diverse product offerings.

The multiplier effects of the sector on the economy are expected to be significant. The project will support the growth of several industries, including urban transportation (taxi drivers), advertising companies, print shops, information technology and software companies, construction firms, and various other retail and service companies. Government revenues from the project will derive from taxes and fees, in addition to the $18.75 million license fee.

This project is aligned with the World Bank Group’s support to improving the country’s investment climate. Overall growth and economic diversification in Guinea-Bissau have been hampered by a weak investment climate, including weaknesses in the telecommunications sector that this project expects to address.

MIGA’s participation in this project supports several agency priorities including South-South investment, investment in Africa, and investment in the infrastructure sector.

This is the second project in Guinea-Bissau to receive the agency’s support since the country’s membership in MIGA in 2006.  The first project involved the privatization of a hotel in capital city Bissau.