Addressing the needs of Africa’s growing consumer class: Wananchi
|Site Location: East Africa
Challenge: Rising household incomes and the growing urban middle class have heightened the demand for consumer goods and services such as internet, telephone and TV. But these basic services are prohibitively expensive in much of Africa because of limited infrastructure.
Solution: OPIC loaned $72 million to Wananchi Group (Holdings) Ltd and its subsidiaries to improve data, voice, and video services available in Eastern Africa by installing a hybrid fiber coaxial (HFC) cable, and developing a direct-to-home TV service.
Impact: The services being provided through this project are expected to reach almost 500,000 homes in Kenya, Tanzania and Uganda within three years. The project is also expected to generate $30 million in additional tax revenue and 1,000 managerial and professional positions over the first five years.
Project meets growing demand for telecom infrastructure
Kenya, Tanzania and Uganda have been among the fastest growing economies in Africa and in the world over the past few years experiencing rapid urbanization, growing household incomes, and an increase in consumer spending. During the next ten years, discretionary incomes are expected to grow by another fifty percent increasing the demand for new telecommunications infrastructure and services available at an affordable price.
The direct-to-home TV service that Wananchi is developing offers nine local channels, including one educational channel for children. In addition to the core markets of Kenya, Tanzania and Uganda, the new services will reach some populations in neighboring countries including Malawi, Rwanda, Zambia, South Sudan, Somalia and Burundi.
In addition to the local job creation in Africa, the project is expected to support approximately 225 U.S. jobs over the first five years of operation.
This project was profiled in 2013