Economy, Asia - Pacific

With Chinese money, Solomon Islands to build Huawei towers

Government to build 161 Huawei telecommunication towers with $100M loan that will be repaid over 20-year period

Riyaz ul Khaliq  | 18.08.2022 - Update : 18.08.2022
With Chinese money, Solomon Islands to build Huawei towers

ISTANBUL

The Solomon Islands announced on Thursday that it signed an agreement with a Chinese bank to build broadband infrastructure in the country.

The Solomon Islands National Broadband Infrastructure Project (SINBIP) has signed an agreement with China Harbour Engineering Company Limited to build up to 161 Huawei towers, an official statement said.

It added that the SINBIP will be “fully funded with a 20 years term concessional loan of approximately CNY448.9 million (around $100million) from the Exim Bank of China at one per cent (1.0%) interest rate.”

The work is expected to commence early next year, subject to the signing of a formal Memorandum of Operation Agreement with Solomon Telekom Company Limited (STCL) and the final funding agreement between the Solomon Islands government and the EXIM Bank of China.

The statement said government received recommendations from two consultants, one from New Zealand, that the SINBIP is “both financially viable and compatible with existing telecommunication infrastructure in the country.”

“The SINBIP is one of the priority projects of the national government,” the statement emphasized.

Work on the SINBIP began in 2019 with a feasibility study on the project.

“The independent review of the SINBIP showed that the project would generate sufficient revenues for government to fully repay both the principal loan amount and interest costs within the loan period,” the statement claimed, calling the agreement “a historical financial partnership” with China.

The two countries established diplomatic relations in 2019.

The announcement of a new deal with China comes after Beijing and the Solomon Islands signed a security agreement in April, which drew criticism from New Zealand, Australia and their allies, including the US and Japan.

Also, China is renegotiating a regional security and trade deal with 10 Pacific nations, which fell short of signing in May.​​​​​​​​​​​​​​

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