THE cost of the Coral Sea submarine cable will be met by both the Australian Government (two-third) and the National Provident Fund (SINPF) (one-third).
Prime Minister Manasseh Sogavare highlighted this during the recent launch of the commencement of cable laying ceremony in Honiara.
Sogavare said the funding will cover both the international and domestic networks including Taro in Choiseul, Munda in Western and Auki in Malaita.
He said the one-third contribution by SINPF means its members are also joint owners of the cable network project.
However, he said much appreciation is for the government and people of Australia for the bigger potion of funding and for assisting in putting in place mechanism to counter and minimise the risk that will come with the cable.
SINPF Board Vice Chairman Dr Aron Oritaemae said the fund is very excited of its investment in the cable project.
“The SINPF is very pleased and excited about its investment in the cable company, the Solomon Islands Submarine Cable Company (SISCC) Limited, to support the efforts of our government and the Australian Government,” he said.
He added SINPF recognises the importance of the infrastructure to the growth of the country and so in May 2017, the board made a decision to invest in this company because it was convinced at that the long-term projected investment return for its members.
“The board is fully aware of the positive ramifications that this investment will bring and the social and the economic benefits.
“The board has looked at other regional countries and is aware of the development that is happening in this country due to their capacity in terms of this infrastructure,” he added.
Dr Oritaemae said the Board is also aware of the new jobs that will be created and there will be increased economic activities that are good for the fund in both informal and formal sectors.
He said the SINPF total exposure to the Coral Sea cable network project is just under $270 million, comprising a direct equity investment of $116 million for its 49% shareholding in the SISCC company and indirectly through the purchase of $150 million long term development bonds.
“The government applied for the seeds of the bonds issue to finance its shareholding through the investment operation of Solomon Islands of 51%.
“I am pleased to state that our financial returns from these exposure ranges from 6.6% per annum to a projected long term rate of return of 18.9% within our investment return objective, our mission and our vision for the members,” he added.
Oritaemae said SINPF members of around 137,000 are very happy to support further the project by having the cable to land at the particular premises also owned by them and are proud to be part of the national transformation investment project.
By IAN M.KAUKUI