Digital connectivity is increasingly becoming a priority requirement both globally and in Indonesia. Although the number of Indonesian internet access has reached 202,6 million, distribution itself is not evenly distributed throughout Indonesia.
As part of HSBC's commitment to support infrastructure development and the national digital economy, HSBC has embraced an international bank syndicate, export credit agency and multilateral development bank to support the financing of the Satellite Republic of Indonesia project (BECAUSE), the first national multifunctional satellite organized through the Public Private Partnership scheme (PPP).
SATRIA was initiated by the Indonesian Ministry of Communication and Information Technology to provide broadband internet services (broadband) including free WiFi access, in more than 150.000 point of public services including schools, hospital, and government offices in remote areas of Indonesia.
The SATRIA project is a commendable initiative from the Government of Indonesia to reduce the digital divide and meet online needs quickly due to the COVID-19 pandemic.
This project is included in the Government of Indonesia's National Strategic Project and is one of the keys to developing broadband connectivity nationally, considering Indonesia's geographical condition which consists of thousands of islands and there are still many people who do not have internet access.
Through a very competitive tender process, The Pacific Satellite Archipelago Consortium (PSN) has been appointed to build, own, and operates a broadband satellite in the SATRIA project.
"In today's digital era, strengthening and expanding digital connectivity will greatly increase access to quality education and health services, while reducing the level of economic and infrastructure disparities, which is part of Indonesia's Sustainable Development Goals. With the SATRIA project, We hope PSN can help thousands of schools and public service facilities, also opening equal internet access for millions of people from Sabang to Merauke,” explained Adi Rahman Adiwoso, President Director, PT Pasifik Satelit Nusantara.
Through the Directorate of Global Banking, HSBC leverages its global network to provide integrated banking solutions to support the success of the SATRIA project, including advisories, arranging, hedging, trade finance, and account services & agency.
As the only Financial Advisor and Sole Social Structuring Bank for the SATRIA project, HSBC leads the structuring of multi-tranche financing consisting of BPIfrance guaranteed loans financed by HSBC, Santander and Korea Development Bank, as well as unsecured commercial credit financed by the Asian Infrastructure Investment Bank and the Korea Development Bank.
Last year, data from Kominfo shows there are still approx 12.500 villages in Indonesia that do not yet have adequate internet access. The Ministry of Education also recorded approx 12.000 schools in Indonesia do not yet have internet access.
Francois de Maricourt, President Director of PT Bank HSBC Indonesia explained, “The demand for data integration will continue to increase during the pandemic and in the future.
Therefore, through the support of a global network and HSBC expertise in financing structuring, we are committed to helping open access for schools, public facilities and communities in disadvantaged areas to be connected and grow, especially through SATRIA, which we believe will play an important role in strengthening Indonesia's digital connectivity, and encourage more sustainable economic growth in Indonesia.
The SATRIA project is the first private project in Indonesia to be financed by the Asian Infrastructure Investment Bank. other than that, SATRIA is also the first satellite in the world to be financed by the Asian Infrastructure Investment Bank and the Korea Development Bank. This financing transaction succeeded in obtaining the title as a social loan to finance the SATRIA project in the new PSN Social Financing Framework.
Sustainalytics provides a second party opinion (Second-Party Opinion) about the PSN Social Financing Framework, and is a credible opinion and has a broad impact, and aligned with the four main components in the Social Bonds Principles 2020 dan Social Loan Principles 2021.
The SATRIA satellite will be launched on 2023. This project will complement various previous government initiatives including the Palapa Ring which is included in the Government of Indonesia's National Strategic Project (Indonesian Regulation no. 58 year 2017).
HSBC has also previously provided significant bank guarantee facilities in the construction of Indonesia's 4G fiber optic network which is included in the Palapa Ring project..
Since then, super fast internet presented through the Palapa Ring project has succeeded in connecting the Indonesian archipelago through a network of sea and land cables throughout 35.000 km.
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