The International Finance Corporation (IFC) has invested in tech investment firm Convergence Partners’ Digital Infrastructure Fund to help strengthen broadband infrastructure and improve access to digital services for individuals and businesses in more than 12 countries in sub-Saharan Africa.
According to the IFC, based in Washington DC and part of World Bank Group, the Covid-19 pandemic has exposed the digital divide in Africa, with only 6% of rural households having access to the internet, compared with 28% of urban households.
The equity investment of US$25m in the Digital Infrastructure Fund is intended to promote improved digital connectivity and access to digital services by investing in independent operators and service providers in sub-Saharan Africa.
IFC’s investment in Convergence Partners’ previous fund – known as the Convergence Partners Communication Infrastructure Fund – will support critical digital infrastructure companies and projects including broadband networks, fibre cable systems, mobile towers, digital service provider platforms and data centres, adding new connectivity and data centre capacity in many countries in Africa where such infrastructure is currently limited.
Andile Ngcaba, chairman of Convergence Partners, said: “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 fibre networks, independent hyperscale data centres, 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.”
Makhtar Diop, IFC’s MD, added: “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 US$100bn digital infrastructure financing gap to reach universal connectivity by 2030.”
Internet access in Africa currently relies largely on mobile networks. Mobile broadband penetration stands at only about 34%, however, and fixed broadband at less than 5% across most of sub-Saharan Africa, excluding South Africa.