||Chapter 2 Gulf of Aqaba|
Currently, the majority of Jordans international traffic is carried via satellite circuits and due to insufficient capacity, service levels remain low. Access to an international submarine system in the Red Sea will provide Jordan reliable high capacity telecommunications access and Israel with diverse routing potential. It will also enable Jordan to become a regional communications hub, providing transit traffic capabilities to its neighbors.
This project involves establishing a branch link to an existing international submarine cable network at Aqaba and a land cable connection between Eilat and Aqaba. It was one of the optic fiber projects evaluated in a recent study.
There are three undersea routes that currently transit or will transit via the Red Sea in the future:
- FLAG is a 10 gbps system from Japan to the U.K. with intermediate landing points in Spain, Italy, Egypt, Saudi Arabia, U.A.E., India, Malaysia, Thailand, China, the Philippines and South Korea. FLAG has interconnections with most major submarine cable systems, and has made arrangements for connectivity with North America at both ends (TAT toEngland and TPC to Japan), to form a global loop.
- SEA-ME-WE #2 (Southeast Asia-Middle East-Western Europe) has been operational since 1994. It connects France to Singapore via Algeria, Tunisia, Italy, Turkey, Cyprus, Egypt, Saudi Arabia, Djibout, India, Sri Lanka and Indonesia. There is no room on this system for Jordan.
- SEA-ME-WE #3 is a 20 gbps system that will have 39 landing points from North Germany to South Korea and Australia.
Booz-Allen & Hamilton consider the FLAG system to be the best near term option for a direct Jordanian/Israeli undersea cable connection. The Jordanian authorities have already negotiated a FLAG landing point at Aqaba. The proposed project was found financially feasible. The project supports the other proposed fiber cable projects proposed for the JRV but can also stand alone independent of them (see Section on JRV).
Substantial revenues would be made possible by the Aqaba FLAG landing, particularly with regards to regional hub functions. North-south fiber infrastructure is either in place or being installed to support the submarine branch in both Jordan and Israel.
The economic feasibility of this project is based on the assumption that revenues will be derived almost entirely from international traffic terminating in Israel and Jordan. The estimated Internal Rate of Return for the project comes to 87%. The payback period is 21 months and Net Present Value at a 15% cost of capital comes to $89.3 million.
6.2. Local Area Telecommunications Network in the Taba-Eilat-Aqaba Macro Area
This project is part of the TEAM Area integrated development program for the North Gulf of Aqaba. The primary goals of this project is to enhance both local and international communication infrastructure towards increasing the competitiveness of the TEAM-Area as a logistic and tourism center. It is identified as a private sector project.
This project has three components:
- Integration of local telephone services in Eilat, Aqaba and Taba: international call within the subregion would be treated as local calls, telephone services would be multi-lingual and area-wide phone books and directory assistance can be devised;
- Provision of digital leased lines throughout the TEAM region;
- Construction of a trinational teleport to improve voice and data communications.
Feasibility studies will be required for these three projects.