Orange Guinea and Guinea Bissau

Project Description 

This summary covers EUR 433.7 million equity investments from Sonatel SA of Senegal to Orange Guinea and Orange Guinea-Bissau (the “Project Companies”), including EUR 200 million future investments in Guinea. Sonatel SA has applied for MIGA guarantees to cover its equity investments for a guarantee period of up to six years in Guinea against the risks of Expropriation, War and Civil Disturbance and Transfer Restrictions & Currency Inconvertibility (“Sub-Project Guinea Conakry”); and against the risks of Expropriation and War and Civil Disturbance in Guinea-Bissau for a period of up to four years (“Sub-Project Guinea-Bissau”), together “The Projects”.

The Projects will support the Sonatel Group in Guinea and Guinea-Bissau in the expansion of its network, equipment upgrade and renovation, introduction of new services, such as 4G/5G, and support for the expansion of mobile money and other digital financial products. As in most countries in the region, Guinea and Guinea-Bissau aim at increasing broadband internet access and availability of digital services, affordability and availability, as well as adoption of voice and messaging services. While Guinea and Guinea-Bissau’s telecom markets have made progress in these areas,  much remains to be done to increase access to broadband and digital services. 

MIGA’s proposed Gross Amounts of Guarantees will be up to EUR 254 million in Guinea and up to EUR 23.8 million in Guinea-Bissau. The revenues for these investments and future retained earnings will come from the Project Companies’ cash flows generated from their telecom operations in these countries. 

MIGA’s risk exposure under the guarantees are proposed to be shared with the IDA Private Sector Window (PSW). The PSW involvement will be via a shared first loss facility that will assist in spreading the risk and result in a reduced cost of the guarantees for the project enterprise. The project meets the minimum concessionality principle and the amount of subsidy is estimated to be less than 2.92% of the total project cost over the envisaged 6 year guarantee period.

Environmental Categorization 

The Project is a category B under MIGA’s Policy on Environmental and Social Sustainability. Click here to view Guinea Bissau and Guniea  Environmental and Social Review Summary. 

Development Impact 

The Projects will support the Sonatel Group in Guinea and Guinea-Bissau in the expansion of its network, thereby increasing consumer access to mobile broadband and supporting financial inclusion through mobile money. As gender-flagged, the Projects will increase the share of women in senior management, among other benefits for women. MIGA’s guarantees are essential for the Group’s business model to mitigate risks associated with their equity investments and to enable/accelerate its ambitious capital investment program.  

Sub Projects Orange Guinea Conakry are consistent with the Country Partnership Framework (CPF) for Guinea FY2018-FY23, which focuses on three pillars: (i) fiscal and natural resource management; (ii) human development; and (iii) agricultural productivity and economic growth. The Sub Project is consistent with the third pillar by fostering an improved business environment through the use of mobile technology, by supporting the development of digital financial technology and financial inclusion; and by promoting access to jobs, especially for young people. The Sub Projects are also consistent with the decentralization of service delivery, including health and education services, especially in rural areas, and improved engagement of citizens.  MIGA’s role as a provider of political risk insurance guarantees through leveraging the MGF is specifically mentioned in the CPF, as is its role in Maximizing Finance for Development.  

Sub Project Orange Guinea-Bissau is consistent with the CPF for Guinea-Bissau FY2018-FY21, extended by the Performance and Learning Review 2021 to FY23. The CPF’s focus areas are: (i) increased access to quality basic services; and (ii) expanded economic opportunities and enhanced resilience. The CPF highlights the issues of accessibility and affordability with respect to internet and mobile phones in Guinea-Bissau, where access is mostly limited to the capital. The Sub Project is consistent with the second focus area by contributing to an improved business environment that supports economic opportunities and economic diversification. Improved access to mobile internet is specifically mentioned under the second focus area.