24 Nov 2008

Hopes fade for Marshalls telecommunications upgrade

10:33 am on 24 November 2008

Hopes of gaining a telecommunications upgrade for the Marshall Islands are fading following last minute changes to the financial terms of a multi-million dollar submarine fiber optic cable.

David Strauss, a board member of the National Telecommunications Authority, told the Marshall Islands Chamber of Commerce that the cable doesn't look to be as much of a done deal as one month ago.

The Authority has been negotiating with the U.S. Army and its contractors over the past three years to secure extension of a branch of the fiber cable to Majuro and Ebeye.

The Army is spending 100 million US dollars to bring the high-tech fiber optic cable from Guam to Kwajalein to increase the communications capability at the Reagan Test Site.

Mr Strauss said the agreement for the country earlier called for a 15 million US dollar investment for a 25-year use period.

But when officials from the operating company, Hannon Armstrong, joined the talks, this month, they changed the terms to $18 million for 10 years.

The Marshall Islands Foreign Minister, Tony deBrum, says he will ask the U.S. government to intervene and assist.