ICT Infrastructure
ICT Infrastructure
Business Model Description
Invest in ICT infrastructure including network upgrades, broadband satellite and wireless fibre solutions, or in the fixed backbone fibre network through partnerships with the Eswatini Post and Telecommunications Corporation, to provide affordable internet to end-users.
Expected Impact
Increase access to information, support essential service delivery, and enhance market reach for businesses.
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
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Country & Regions
- Eswatini: Countrywide
- Eswatini: Manzini
- Eswatini: Hhohho
Sector Classification
Infrastructure
Development Need
Limited infrastructure is identified as a key contributor to poverty and a major obstacle to inclusive development. 35% of road infrastructure are in poor condition, housing, water and waste management are of poor quality, and physical infrastructure is poorly maintained, which curtails growth, prosperity, investment inflows, trade and employment (1, 7).
Policy priority
The National Development Plan (NDP) and Kingdom of Eswatini Strategic Roadmap 2019-2022 highlight efficient economic infrastructure network as a prioritized national outcome and emphasize investments in infrastructure for improved public and private sector activity to support socioeconomic development (1, 6).
Gender inequalities and marginalization issues
Existing infrastructure such as water, sanitation and hygiene, waste management, road infrastructure and ICT infrastructure in rural and low-income areas is significantly underdeveloped compared to urban and affluent areas and do not address the socio-economic development needs of the poor, with increasing pressure placed on infrastructure in rural areas and expanding low income urban settlements, resulting from urbanization (1, 2).
Investment opportunities introduction
Key investment opportunities for infrastructure in Eswatini include housing, ICT, transportation, water and sanitation, waste management, energy utilities as well as sector specific infrastructure for healthcare facilities, education centers and industries that stimulate economic growth (1, 3)
Key bottlenecks introduction
fiscal challenges faced by government resulting in limited public expenditure capacity on infrastructure as well as rapid urbanization and extreme climatic conditions place increasing pressure on existing infrastructure (1, 3).
Infrastructure
Development need
Eswatini has made progress in terms of infrastructure development with new dry- and airports, water and sanitation projects and network reinforcement, however, the gains from capital investment have been lost due to a mismatch between recurrent and capital expenditures and deteriorating infrastructure resulting from poor maintenance, climate change and urbanization (1, 4).
Policy priority
The Industrial Development Policy and the Post-covid 19 Economic Recovery Plan call for increased investments in infrastructure that will stimulate industrialization, trade and connectivity to meet the socioeconomic needs of the poor and marginalized through investments in factory shells, network extension, road and rail infrastructure, and housing (4, 5).
Gender inequalities and marginalization issues
Lack of appropriate and efficient infrastructure in rural and low-income areas such as efficient road network connecting rural areas to urban centers, ICT for affordable internet connectivity and water, sanitation and hygiene constrain the development potential of Eswatini's marginalized population groups (1, 7).
Investment opportunities introduction
Infrastructure development is the central pivot of improving both domestic and foreign direct investment. Developing roads and rail infrastructure, ICT infrastructure, water, sanitation and hygiene infrastructure and infrastructure conducive for industrialization would contribute to improving investment and trade environment (1, 6, 7).
Key bottlenecks introduction
Deteriorating conditions of existing infrastructure due to poor maintenance, lack of human resources to develop and maintain infrastructure and lack of affordability by rural inhabitants have constrained infrastructure development.
Engineering and Construction Services
Pipeline Opportunity
ICT Infrastructure
Invest in ICT infrastructure including network upgrades, broadband satellite and wireless fibre solutions, or in the fixed backbone fibre network through partnerships with the Eswatini Post and Telecommunications Corporation, to provide affordable internet to end-users.
Business Case
Market Size and Environment
USD 50 million - USD 100 million
1.2 mobile cellular subscriptions and 27,386 fixed broadband subscriptions
Eswatini had 1.2 million mobile cellular subscriptions and 27,386 fixed broadband subscriptions in 2020-2021 (14).
Mobile operator Eswatini Mobile has disclosed plans to invest E 600 million (USD 44.8 million) in its network over the course of the next 5 years (16).
Indicative Return
< 5%
A private internet service provider's initial investment was E 3 million (USD 200,000) and revenue was slightly above initial investment, producing a return on investment ratio below 5% (15).
Investment Timeframe
Medium Term (5–10 years)
A private internet service provider's initial investment produced returns after the first five years (15). Eswatini Mobile's planned network upgrades also span over a 5-year period (16).
Ticket Size
> USD 10 million
Market Risks & Scale Obstacles
Capital - CapEx Intensive
Business - Supply Chain Constraints
Market - High Level of Competition
Impact Case
Sustainable Development Need
Being landlocked, Eswatini depends on neighboring countries for international bandwidth and development of the ICT sector has been hampered by the limited fixed-line infrastructure and by a lack of competition in the access and backbone networks (17).
Even though the incumbent mobile network provider decreased its cost of data to E 99 per GB (14), research that compared 1 GB of data across countries in USD found that 1 GB of data in Eswatini, in 2019, was the most expensive in Africa at USD 21.39 (18), which hampers accessibility of information and economic opportunities in the country.
Much of Eswatini's mobile network infrastructure is outdated and needs maintenance and upgrading (20), resulting in inefficiencies and unreliable internet connections.
Gender & Marginalisation
Only 47% of Eswatini's population are internet users and the growth rate per year stands at 1%. Access to internet is most restricted amongst the poor with a digital gap resulting from high unemployment and poor market penetration (19).
Poor and marginalized households are unable to benefit from well-developed fibber optic networks and the digital economy due to high costs of access and limited ICT infrastructure (17, 19).
High ICT costs impedes financial inclusion of poor and vulnerable households as it increases the cost of financial services, such as payment systems as well as the use of technology for information services, such as geomapping or agricultural information, that reduces risk for credit providers (18).
Expected Development Outcome
Increased investments in ICT infrastructure reduces the country's digital gap by enhancing access to information (19) and reducing information asymmetry and information gaps between population groups (1, 14).
The ICT infrastructure contributes to improved human capital development due to better access to information and learning opportunities (7, 14).
Improvement in ICT infrastructure has a wide range of positive spillover effects across sectors, including healthcare, education, financials and agriculture, through increased access to digital solutions, including online learning, tele-medicine and online farmers platforms (20).
Gender & Marginalisation
ICT infrastructure leads to increased access and affordability of internet services, which allows poor households to benefit from digital economy opportunities, such as e-banking and e-health, as well as advances financial inclusion of these segments of the population (17, 18).
The advanced digital inclusion, as a result of ICT infrastructure, allows large portions of the Eswatini population to benefit from the innovation and potential brought about by digital technologies, such as improved data management for smallholder farmers and increasing access to education and healthcare services in remote areas (17).
Primary SDGs addressed
9.c.1 Proportion of population covered by a mobile network, by technology
Mobile market penetration is 94%; the GSM Association coverage map shows close to complete 2G or GSM coverage across most of the country and ITU indicators suggest coverage is fairly low for 3G at 54%. Technologies such as 4G have predominantly been developed along roads covering the business corridor through the middle of the country (18).
The Eswatini Communications Commission (ESCCOM) seeks to achieve universal access and service to quality, reliable and affordable communications services in Eswatini (14).
17.6.1 Fixed Internet broadband subscriptions per 100 inhabitants, by speed
17.8.1 Proportion of individuals using the Internet
Fixed internet broadband covers only 0.6% of the total population (18).
47% of Eswatini's population uses the internet (19).
Eswatini seeks to achieve the SADC Broadband Target by 2025, which entails that entry level broadband services should be made affordable in developing countries at less than 2% of monthly Gross National Income (GNI) per capita and closing the digital divide amongst communities (14).
The Eswatini Communications Commission (ESCCOM) seeks to achieve universal access and service to quality, reliable and affordable communications services in Eswatini (14).
4.4.1 Proportion of youth and adults with information and communications technology (ICT) skills, by type of skill
N/A
N/A
Secondary SDGs addressed
Directly impacted stakeholders
People
Gender inequality and/or marginalization
Corporates
Public sector
Indirectly impacted stakeholders
Planet
Corporates
Outcome Risks
If the ICT infrastructure does not lead to greater affordability for low-income households, the digital and information gap between the rich and poor segments of the population may be perpetuated (19).
If not regulated actively, the market dominance of entities such as MTN and Eswatini Post and Telecommunications Corporation (EPTC) may be exacerbated, resulting in oligopolistic market structure and marginalising other market players.
If not regulated actively, the market dominance of entities such as MTN and Eswatini Post and Telecommunications Corporation (EPTC) may be exacerbated, resulting in oligopolistic market structure and marginalising other market players.
Impact Risks
As ICT infrastructure requires continuous attention, and if it is not properly maintained and upgraded, it may cause failures in essential technology and services, which may limit the expected impact.
If the services and opportunities associated with ICT infrastructure are not affordable to low-income communities or do not reach marginalised areas where the needs are most pronounced, the expected impact may be limited.
If the industries expected to utilise the ICT infrastructure for enhanced reach do not pursue the new market opportunities, especially in health care and education, the impact may be limited.
Impact Classification
What
ICT infrastructure develops digital connectivity for increased access to information, as a means for essential service delivery, and to enhance market reach for businesses.
Risk
While the ICT infrastructure model is proven, maintenance and upgrading, affordability and reach, as well as uptake by secondary industries requires consideration.
Impact Thesis
Increase access to information, support essential service delivery, and enhance market reach for businesses.
Enabling Environment
Policy Environment
National Information Communication Infrastructure Policy, 2012-2016: Aims to guide effective and efficient implementation of the Information Communication and Technology (ICT) sector (22).
National Development Plan (NDP), 2019/20-2021/22: Efficient economic infrastructure networks is part of the National Outcome 6 of the NDP with ensured accessible, robust, reliable and affordable ICT included as a sectoral outcome (1).
Industrial Development Policy, 2015-2022: Includes strengthening industrial competitiveness through information, technology and communication as one of the principals of industrialization in the policy (5).
Financial Environment
Financial incentives: In its 2022 budget, the government has provided E 360.7 million (USD 23.9 million) to the Ministry of ICT to improve the availability and performance of ICT infrastructure (34).
Fiscal incentives: Financial incentives for all investors include tax allowances and deductions for new enterprises, including a 10-year exemption from withholding tax on dividends and a low corporate tax rate of 10% for approved investment projects, including ICT infrastructure (31).
Other incentives: Eswatini Mobile and MTN are investing USD 44.8 million and USD 1. 27 million respectively to modernize and expand their network coverage (4, 16).
Regulatory Environment
Electronic Communications and Transactions Bill, 2020: Aims to provide regulations of electronic transactions and electronic communications, facilitate the use of e-government services, protect customers and limit the liability of service providers (28).
Data Protection Bill, 2020: Provides for the collection and processing of personal data, the protection of personal data, disclosure of personal data for legitimate purposes, rights of access to and correction of personal data and incidental matters (29).
Computer Crime and Cybercrime Bill, 2020: Criminalizes offences involving computer electronic communications network related crimes, provides for the investigation and collection of evidence for computer and network related crimes and provides for the admission of electronic evidence in court (30).
Electric Communications Act, 2013: Sets out the mandate and operationalization of the Eswatini Communications Commission (ECC) (35).
Public Procurement Act, 2020: Regulates the procurement of goods, works and services by procuring entities, including for ICT infrastructure, to ensure transparency, accountability and promote diverse private sector participation in public procurements (33).
Marketplace Participants
Private Sector
MTN, Eswatini Mobile, The Paratus Group, Real Image, Jenny Eswatini, Touch ID, Swazi Sat, Afri Metro, NetComm.
Government
Ministry of ICT, Eswatini Communications Commission (ECC), Eswatini Post and Telecommunications Corporation (EPTC), Eswatini Telecom, Royal Science and Technology Park (RSTP).
Multilaterals
Finmark Trust, United Nations Development Programme (UNDP), United Nations Capital Development Fund (UNCDF).
Target Locations
Eswatini: Countrywide
Eswatini: Manzini
Eswatini: Hhohho
References
- (1) Ministry of Economic Planning and Development. 2019. National Development Plan (NDP) 2019/20-2021/22. http://www.gov.sz/images/CabinetMinisters/NDP-2019-20-to-2021-22-final.pdf
- (2) Ministry of Economic Planning and Development. 2019. Voluntary National Review. https://sustainabledevelopment.un.org/content/documents/24651Eswatini_VNR_Final_Report.pdf
- (3) Ministry of Tourism and Environmental Affairs & Ministry of Economic Planning and Development. 2021. Kingdom of Eswatini’s Revised Nationally Determined Contributions (Offline)
- (4) Government of Estwatini. 2020. Post COVID-19 Kingdom of Eswatini Economic Recovery Plan. http://www.gov.sz/images/CORONA/FINAL-POST-COVID-19-ECONOMIC-RECOVERY-PLAN-ESWATINI-14082020_compressed.pdf
- (5) Ministry of Commerce Industry and Trade. 2015-2022. Industrial Development Policy. https://www.gov.sz/images/MOCIT/Industrial-Development-Policy-2015---2022-Swaziland-FINAL-AND-ADOPTED.pdf
- (6) Government of Eswatini. 2019. Kingdom of Eswatini Strategic Roadmap 2019-2022. http://www.gov.sz/images/CabinetMinisters/STRATEGIC-ROADMAP-2018-2023---MAY-2019.pdf
- (7) Ministry of Economic Planning and Development. 2017. The Strategy for Sustainable Development and Inclusive Growth (SSDIG), Offline
- (8) Ministry of Economic Planning and Development. 2017. The Strategy for Sustainable Development and Inclusive Growth (SSDIG), Offline
- (8) Paratus. 2022. Paratus activates direct Terrestrial Fiber Link from Teraco to Maputo. https://paratus.africa/mz/paratus-activates-direct-terrestrial-fiber-link-from-teraco-to-maputo/
- (9) Jenny Swaziland. 2022. Company website. https://jenny.co.sz/about
- (10) SwaziSat. 2022. Company Website. https://swazisat.com
- (11) AfriMetro. 2022. Company Website. https://www.afrimetro.com/home#
- (12) Eswatini Mobile. 2022. Company website. https://eswatinimobile.co.sz
- (13) MTN Eswatini. 2022. Company Website. https://www.mtn.co.sz
- (14) Eswatini Communications Commission. 2021. Annual Report- 2021. https://www.esccom.org.sz/publications/reports/docs/2021_AR.pdf
- (15) UNDP stakeholder consultation with Internet Service Provider in Eswatini. February 2022
- (16) Operator Watch Blog. 2021. People of Eswatini want their Internet Connectivity back. https://www.operatorwatch.com/2021/07/people-of-eswatini-wants-their-internet.html
- (17) Budde Comm. 2022. Eswatini (Swaziland) Telecoms Market Report. https://www.budde.com.au/Research/Eswatini-Swaziland-Telecoms-Mobile-and-Broadband-Statistics-and-Analyses
- (18) Finmark Trust. 2020. Eswatini Financial Inclusion Refresh. https://www.uncdf.org/article/6570/eswatini-financial-inclusion-refresh
- (19) ESEPARC. 2020. Digital Inclusion key to Eswatini’s Digital Economy. https://www.separc.co.sz/2021/04/10/digital-inclusion-key-to-eswatinis-digital-economy/
- (20) UNDP Stakeholder Consultation with Eswatini Communications Commission. February, 2022
- (21) UNDP Eswatini. 2020. Building a resilient education system with digital solutions in Eswatini. https://www.sz.undp.org/content/eswatini/en/home/blog/building-a-resilient-education-system-in-eswatini.html
- (22) Ministry of ICT. 2012. National Communications and Information Infrastructure Policy. https://www.ellipsis.co.za/wp-content/uploads/2016/07/Swaziland.pdf
- (28) Ministry of ICT. 2020. THE ELECTRONIC COMMUNICATIONS AND TRANSACTIONS BILL. https://www.gov.sz/images/ICT/The-Electronic-Communications-and-Transaction-Bill2020.pdf
- (29) Ministry of ICT. 2020. The Data Protection Bill. https://www.gov.sz/images/ICT/The-Data-Protection-Bill-2020.pdf
- (30) Ministry of ICT. 2020. The Computer Crime and Cybercrime Bill. https://www.gov.sz/images/ICT/The-Computer-Crime--and-CyberCrime-Bill-2020.pdf
- (31) US Department of State. 2021 Investment Climate Statements: Eswatini. https://www.state.gov/reports/2021-investment-climate-statements/eswatini/
- (32) ESCCOM. 2107. ICT Sector Baseline Report. https://www.esccom.org.sz/publications/notices/docs/ICT-BASELINE-REPORT-21-JUNE-2017-final.pdf
- (33) Eswatini Public Procurement Regulatory Agency. Public Procurement Regulations 2020. https://sppra.co.sz/sppra/documents/regulations/Pages%20from%20Eswatini%20Government%20Gazette%20-%2018th%20Dec%202020.pdf
- (34) Ministry of Finance. February 2022. Budget Speech 2022. https://www.gov.sz/images/CabinetMinisters/Budget-Speech-2022---FINAL.pdf
- (35) Eswatini Communications Commission. Regulations. https://www.esccom.org.sz/regulations/