Korea Telecom Corporation (KT) and the government of Rwanda signed a shareholders agreement with, to establish a Systems Integration & IT Services joint venture (JV) Company to build and operate services in Rwanda and across the neighbouring region, based on advanced ICT infrastructure.
The JV established for an initial 10 year term was co-signed on September 18, 2013 between Mr HJ Kim, President of Global & Enterprise Group on behalf of KT Corporation and Ms Clare Akamanzi, CEO of Rwanda Development Board (RDB) on behalf of the Rwandan government.
Mr HJ Kim stressed that “This is a huge opportunity for both the Government of Rwanda and KT Corporation. The joint venture will contribute to developing the ICT industry, stimulating job creation, and promoting socio-economic development in Rwanda.
“As for KT, this opportunity will help the company build a global ICT reference, and expand the Rwanda model to other African countries,” said Kim.
As principal shareholders, KT will bring expertise and a baseline cash injection of around $8 million and additional project-by-project cash injection as required. The Government’s equity investment will be in the form of assets.
The company is intended to create significant computing power based on advanced computing and “cloud” services infrastructure enabling Rwanda to achieve a leap- frogging effect in the same way that the country is using 4G LTE to skip the 3G stage of broadband network evolution. The company’s market will be region-wide, allowing it to export services and know-how.
Rwanda’s central objective for this company is to systematically implement and operate mechanisms to achieve large-scale transfer of know-how from KT and to develop a broad base of ICT skills consistent with the goals of Rwanda’s EDPRS-II 2013-2018 program.
The company’s work force is expected to grow rapidly in its first 6 years reaching around 700 highly skilled employees in 10 years.
The company is also expected to stimulate the emergence and growth of a wide range of small medium-size enterprises (SMEs) either subcontracting to the company or creating innovative applications to deploy as online services within the company’s services infrastructure.
Minister of Youth & ICT Jean Philbert Nsengimana said that “This joint venture to establish the Systems Integration & IT Services Company comes at the time when some targets of the EDPRS2 focusing on infrastructure are being given more importance to enable Rwanda to achieve the targets set to transform Rwanda into a modern, knowledge-based economy and a middle income citizen earners as there will be more jobs created and social life transformation.”
“This rapid deployment of high-speed broadband capability in Rwanda will accelerate development of the country’s ICT sector, create jobs, as well as help facilitate social and economic progress,” said Nsengimana.
Based on recent reports published by the International Telecommunications Union (ITU), 95 per cent broadband penetration will translate into a 10 to 13 per cent boost in GDP growth for Rwanda.
KT, Korea’s largest telecommunications provider and Rwanda will also seek opportunities to extend the business model of this JV to neighbouring countries.
The Government of Rwanda continues to implement a rapid succession of creative initiatives towards its policy goal to transform Rwanda into a knowledge-based society, using ICT as a key enabler.
Among the initiatives 3,000 km of the national fibre optic infrastructure was completed in 2010; the “One Laptop per Child” program; the e-Soko program which enables farmers to purchase subsidized handsets for use with the real time agri-products information system; and government efficiency programs including e-Government, e-Health and e-Education