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West Bank and Gaza Strip, Wataniya Telecoms

GuarantCo supports financing to deliver affordable mobile telecommunications to the people of the isolated Palestinian Territories

With very poor service provision, mobile phone penetration in Gaza and the West Bank in 2008 was a mere 29%. But two Palestinian banks have since been able to provide the critical loans for the successful launch of Wataniya Palestine Telecom (WPT), a new mobile telecommunications operator in the Palestinian Territories.


The dynamic economic and social benefits of mobile phone technology in developing countries are increasingly well documented.  The restrictions on movement for Palestinians make good mobile communications here even more vital for development than elsewhere. But in 2008, with only one provider operating in the West Bank and Gaza Strip, service was poor and competition in the market was overdue.

Wataniya Palestine Telecom (WPT) was introduced to PIDG company GuarantCo by Standard Bank Plc., with a view to financing WPT, and creating a second mobile licensee in the Palestinian Territories. WPT launched services in 2009 and has had a successful roll-out. By improving service quality and reducing tariffs, WPT has reduced the cost of doing business in the Palestinian Territories.


The total project cost is estimated at US$140m, the largest ever private sector investment in the Palestinian Territories, and a high-profile project, spreading a positive investment message. WPT is 57% owned by National Mobile Telecommunications Company (NMTC) through a subsidiary called Wataniya International, and 43% by the Palestine Investment Fund (PIF), a Palestinian company supporting projects promoting a favourable investment climate in the Palestinian Territories. GuarantCo provided a  guarantee of $10m to partially cover the $5m loan from Commercial Bank of Palestine (CBP) and $20m loan from Bank of Palestine (BOP). Other lenders and guarantors to the project include: Standard Bank, Al-Quds Bank, Ericsson, IFC,  and the Swedish Export Credit Agency.


Wataniya Palestine Telecom was keen to involve as much financial support from the Palestinian banking sector as possible, but – while the Bank of Palestine and the Commercial Bank of Palestine both have substantial US dollar deposits – local banking regulations put a limit on the amount they could lend without a guarantee.  WPT was able to access US$25m in financing from these two local banks – but only after GuarantCo provided its US$10m partial risk guarantee.


  • The scale of this private sector investment signals an improved investment climate in the Palestinian Territories and will catalyse support for other infrastructure projects.
  • Private sector investment committed: US$140m
  • Almost one million people in the West Bank are expected to be connected to Wataniya by the end of the seven-year debt term in 2016. By the middle of 2012, nearly 600,000 of these customers had already been connected.
  • In addition to the US$140m project investment, the total license fee expected to be paid is US$385m. US$140m of this has been paid up-front; the remainder of the licence fee will be paid when specific subscriber numbers are met.
  • As WPT has steadily grown its customer base, there is greater investor confidence in the Palestinian telecommunication market – confidence which led to the company’s initial public offering in 2010 being oversubscribed. Wataniya is required to list 30% of its shares on the Palestinian Stock Exchange, stimulating economic activity in the region.
  • There has been a direct demonstration effect: after successfully rolling out services in the West Bank using the facilities provided by GuarantCo  et al, Wataniya is now rolling out services in Gaza. GuarantCo’s involvement has helped transition the local banks into a position where they are now able to provide financing by themselves and GuarantCo’s facility was released 3 years ahead of its final tenor, in October 2012.
  • Increased competition has led to better quality services and lower tariffs for consumers, which in turn, will reduce the cost of doing business in all sectors.
  • The economic benefits of mobile phones go well beyond access to information. Mobiles spawn a wealth of micro-enterprises providing employment, such as selling airtime on the streets and refurbishing handsets.
  • Wataniya will help the Palestinian diaspora - around nine million people - to connect with family and friends in the West Bank at cheaper rates and with improved levels of service.