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Asian Development Bank Gives $50M Financing To Kacific
The Asian Development Bank (ADB) signed a $50 million financing package on 2 December 2019 with Kacific Broadband Satellites International Limited (Kacific) to provide satellite-based, low cost, high-speed, wholesale broadband internet connections to countries in Asia and the Pacific, especially in remote areas of small island nations in the Pacific, and larger island nations like Indonesia and the Philippines.
ADB’s assistance will be used by Kacific for the Asia-Pacific Remote Broadband Internet Satellite Project. The project will support the construction, launch, and operation of a shared geostationary earth orbit (GEO), high-throughput satellite (HTS), featuring Ka-band technology. The project will provide wider access to broadband internet connections in remote areas where there is limited or no internet coverage available to date. Kacific1 will be launched by SpaceX in December 2019 and will be operational in early 2020.
There are currently over 2 billion people in Asia and the Pacific who do not have access to broadband internet connections for reasons which include a lack of existing infrastructure, geographical challenges, and the high cost of such services.
“Better access to reliable, high-speed internet can help improve people’s education and provide access to better information, attract investments, reduce rural–urban development gaps, enhance trade and connectivity, as well as stimulate local economies. It will also help to improve communication especially during emergencies and times of disasters when terrestrial networks might be damaged.” said ADB’s Vice President for Private Sector Operations and Public-Private Partnerships, Mr. Diwakar Gupta.
“ADB’s role was key in getting this transaction closed” said Kacific Founder and CEO, Mr. Christian Patouraux. “ADB’s involvement in the project has helped secure the necessary financing for this highly developmental project. The benefits of connectivity are life-changing; from increased tourism, access to information, financial services, to healthcare and education for many remote communities in the region.”
The financing comprises a loan from ADB and a parallel loan provided by the Leading Asia’s Private Infrastructure Fund (LEAP), which is administered by ADB. LEAP is one of ADB’s cofinancing vehicles dedicated to private sector infrastructure in Asia and the Pacific. Japan International Cooperation Agency (JICA) supports the fund, launched in August 2016, through a $1.5 billion equity commitment. Combined with ADB’s own capital and that of commercial partners, the fund is expected to provide financing of at least $6 billion and enables ADB to boost support for quality and sustainable infrastructure.
GuarantCo, a member of the Private Infrastructure Development Group, will provide a guarantee to a private financer to cofinance the project. This will be the first-ever cofinancing of an infrastructure project by ADB and GuarantCo in the region.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. In 2018, it made commitments of new loans and grants amounting to $21.6 billion. Established in 1966, it is owned by 68 members—49 from the region.
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