x Abu Dhabi, UAESaturday 29 July 2017

Region needs $25bn internet investment, says World Bank

The Arab world will need at least US$25 billion of investments to develop its fixed and wireless internet, says the World Bank in a recent report.

The World Bank says that better broadband can improve economic growth in the Mena region, as well as attract foreign direct investment. Andrew Henderson / The National
The World Bank says that better broadband can improve economic growth in the Mena region, as well as attract foreign direct investment. Andrew Henderson / The National

The Arab world will need at least US$25 billion of investments to develop its fixed and wireless internet, according to a World Bank report.

The World Bank’s view is that better broadband can improve economic growth in the Mena region, as well as attract foreign direct investment.

“We estimate that countries that are able to increase broadband by 10 per cent, this translates to the acceleration of GDP growth by as much as 1.4 per cent,” said Carlo Maria Rossotto, World Bank ICT regional coordinator.

“Broadband can be an important tool to reverse this recent trend towards slower economic growth in Mena.”

He said the reliability broadband infrastructure factors into investors’ decisions on where to put their money.

Commenting about prices of broadband in the region, Mr Rossotto said: “The UAE is excellent.”

“Broadband is very affordable here. Broadband subscription in the UAE is less than 1 per cent of the disposable monthly income.”

However, he said that affordability of broadband in countries such as Algeria, Morocco, Tunisia, Yemen is “a core issue.”

In Tunisia, the poorest 40 per cent of the population would need to spend more than 40 per cent of their income to afford high-speed internet.

Further, he said, “In Morocco, it could take up to 30 per cent of a poor family’s income to afford broadband subscription”.

The World Bank says broadband is affordable when it costs less than 5 per cent of monthly income.

Commenting on the future of broadband in the UAE, Mohamed Nasser Al Ghanim, director general of the Telecommunications Regulatory Authority, said that the country is heading to high broadband penetration, reflecting strong growth in GDP.

He also said that 700-megahertz spectrum space will be freed up in 2015 for the use of fast internet services known as LTE, or Long Term Evolution.

“Currently TV broadcasts use this spectrum,” said Matthew Reed, principal analyst with Informa Telecoms & Media. “When TV broadcast all go digital the spectrum will become free for other uses like mobile broadband.”

He said the spectrum will facilitate the expansion of high-speed internet beyond main cities to achieve coverage in smaller towns and rural areas.

selgazzar@thenational.ae