Chile and CAF to lead feasibility study for the first digital gateway between South America and Asia
This is the first step for an undersea cable that will connect the two continents and allow the development of a digital integration system in the region.
Today, the Transport and Telecommunications Ministry (MTT) and CAF - Latin America's development bank - entered into a Technical Cooperation Agreement for US$3 million (CLP$2.1 billion) to finance the feasibility studies for the Undersea Cable Integration Project called the "Asia-South America Digital Gateway".
The study will provide the technical, legal, financial and economic specifications for the construction of an undersea cable between the two continents, thereby enabling digital integration system for the region.
The project aims to digitally connect South America with the Asian continent through the deployment of a submarine fiber optic cable. Its potential route covers a distance of approximately 24,000 kilometers and its initial design includes at least two pairs of fiber optics lines, with a transmission capacity that meets current standards for such systems (10-20 Tbps).
Chile’s Transport and Telecommunications Minister Gloria Hutt emphasized that the study "will provide information on the layout options for the project, positioning Chile as the gateway for data entry to the entire region, and as an attractive location for datacenters connected to this fiber. This is one of the ways we are pushing forward our telecommunications agenda, known as the 'Digital Matrix', fulfilling President Sebastián Piñera's mandate to increase Chile’s connectivity, both throughout our national territory and with the rest of the world. We expect to see the first results of this study during the second half of 2019 and, during 2020, we intend to create the holding consortium to subsequently begin construction of the cable.
CAF's Executive President, Luis Carranza Ugarte, said, " more connectivity, together with greater network capacity and reliability, will stimulate digitalization in production processes, improving their efficiency. This is a key factor for the sustainable development of Chile and Latin America, so we are very pleased to promote integration infrastructure projects, especially with Asia, which is a strategic market for the region.”
Mr. Carranza pointed out that in supporting this project, CAF is renewing its commitment to digital regional integration, which has also been seen by its financial backing of large-scale telecommunications infrastructure projects for the deployment of fixed and mobile broadband access networks, as well as its financing of studies for the installation of a data exchange center in Panama, among other initiatives.
The Telecommunications Undersecretary, Pamela Gidi, said that "the Government has the political and economic will to transform Chile into an important digital hub for the region, which is why we are promoting this submarine connection initiative with Asia. This is complemented by the deployment of fiber optics landlines at the various border crossings throughout Chile, and internally, with the National Optical Fiber (Fibra Óptica Nacional, FON) and Southern Optical Fiber (Fibra Óptica Austral, FOA) projects, effectively doubling existing capacity.”
The Undersecretary added that, regardless of the results of the feasibility study to be published for tender next week, the Government will take the necessary measures so that part of the route passes through Easter Island, improving digital connectivity on the island, connecting its inhabitants, and allowing digital processes to be introduced to their productive activities, such as tourism.
After signing this agreement, the Transport and Telecommunications Ministry - through the Telecommunications Undersecretariat (SUBTEL) - will begin the tender process for the demand and feasibility study and its subsequent award. This initiative, led by Chile, has received the support of Argentina, Brazil and Ecuador, countries that, together with others in the region, will benefit from significant trickle-down effects by linking up with Asia-Pacific at a lower cost.
The first digital highway between South America and Asia will improve network reliability and human capital development, increase competition, facilitate conditions for the location of data centers, and meet future demand for services stemming from the fourth industrial revolution and big data, among others.
The tender's terms and conditions for companies interested in bidding for the work to carry out this study will become available next week.