International Finance Corporation (IFC), a member of the World Bank Group, announced its $25 million investment in Convergence Partners' Digital Infrastructure Fund to help strengthen broadband infrastructure and improve online access to digital services in the sub-Saharan Africa region.
The COVID-19 pandemic exposed the digital divide in Africa while the adoption of digital technologies and the demand for digital infrastructure were evident globally. Thus, IFC's equity investment aims to improve digital connectivity and access to digital services by investing in independent operators and service providers in Africa.
Investments made through the Digital Infrastructure Fund will support critical digital infrastructure companies and projects including broadband networks, fiber cable systems, mobile towers, digital service provider platforms, and data centers. Many countries in Africa where such infrastructure is currently limited can benefit from adding new connectivity and data center capacity.
"We are very pleased to extend our relationship further with IFC, who were also investors in our last fund and co-investors with us in underlying portfolio companies. We share a joint ambition to invest in those businesses on the African continent that are contributing meaningfully towards addressing the digital inclusion gap that exists. Africa is ready for high throughput pervasive fiber networks, independent hyperscale data centers, edge, AI, 5G, and IoT. Connectivity is at the foundation of 4IR. Our new Digital Infrastructure Fund is the platform for building Digital Africa for future generations," said Andile Ngcaba, chairman of Convergence Partners.
According to the International Telecommunications Union (ITU), Africa also experiences a large urban and rural connectivity divide, with less than half (28%) of urban households having Internet access and only six percent in rural areas. Moreover, mobile broadband penetration stands at only about 34 percent with fixed broadband at less than five percent, excluding South Africa.
"Increased broadband connectivity supports economic growth, job creation, and quality of life. Together, we can help connect more homes and businesses in Africa by supporting funds such as the Convergence Partners Digital Infrastructure Fund to bridge the $100 billion digital infrastructure financing gap to reach universal connectivity by 2030," said Makhtar Diop, IFC's managing director.