Inside Chile’s US$650mn LatAm-Asia Pacific cable project

Chile is advancing its US$650mn Humboldt international submarine cable project, with which it intends to become the digital hub between Latin America and the Asia-Pacific.

As part of this process, Chilean infrastructure fund Desarrollo País, majority-controlled by the state, has selected Singapore’s H2 Cable as strategic partner of the system.

According to Chile's telecoms regulator Subtel, both Desarollo and H2 have hired International Connectivity Services, belonging to Hawaiki Group, to “finalize the system design, kick-start the recruitment process and connect with potential key customers.”

Planned to extend 14,810 km, Humboldt is expected to provide end-to-end connectivity between Valparaíso (Chile) and Sydney (Australia), where it will interconnect with other systems reaching Asia.

It will also have branches for the possible connection of other countries and territories, such as Juan Fernández and Isla de Pascua, as well as New Zealand, according to Subtel.

Humboldt’ able route. Source: Subtel

In its preliminary design, the Humboldt cable was planned to connect Chile and China, later changed to Australia, due to US diplomatic pressures to counter China’s growing influence, according to experts.

“The Japanese then came in [through a memorandum of understanding] and one way or another, behind the scenes and as well up front, the cable will now only reach Australia. So the US can do things behind the scenes to maneuver and pressure,” Barbara Stallings, international affairs professor at Brown University, said during a Chinese financing webinar by the Wilson Center in September.

Moreover, H2 Cable also owns a namesake cable project connecting Australia and Hong Kong. Announced in 2019, the H2 system is planned to launch in 2022. The cable’s supply and installation was commissioned to US submarine systems developer SubCom. 

H2’s branches include connections to islands and regions China’s Huawei had agreed to install before Australia blocked its project there in 2018 on security grounds, as Reuters reported back then.

The H2 cable system is designed for a number of branching units that can be deployed to locations including Taiwan, Papua New Guinea, Solomon Island, Guam, Queensland, Hawaii and Los Angeles.

Image source: SubCom

With the contract with Chile’s Desarollo País, H2 would directly or indirectly operate a broader submarine internet network uniting Chile-Oceania-China and potentially the US. 

Hired by H2 Cable and Chile’s Desarollo País, International Connectivity Services is registered in New Zealand. 

It was incorporated in December 2014, but only sparse information is available about the company, which does not even have a website. 

Available information shows that Remi Galasso is one of its directors. Galasso is also CEO of Hawaiki Cable, International Connectivity’s parent.

But Subtel also refers to Galasso as director of the H2 Cable.

“We see this project [Humboldt] as an opportunity to establish a totally diverse new trans-Pacific link and, furthermore, to expand the communication capabilities of Chile and neighboring countries. We hope to work with Desarrollo País in the construction of this critical infrastructure project, which will improve the digital economies of Latin America and APAC,” a Subtel press release quoted Galasso as saying.

Hawaiki Cable is the owner of a 15,000km namesake cable linking Australia, New Zealand, American Samoa, Pacific Island, Hawaii, and Oregon on the US West Coast.

In October 2016, AWS purchased capacity in the Hawaiki system, making it AWS' first investment in an international submarine cable system, according to Submarine Networks. 

The Hawaiki cable went live in July 2018. SubCom was its supplier. 

Image Source: Hawaiki

On its website, Hawaiki said the cable connects 356mn consumers and is “the largest and fastest link between Australasia and the US.”

In July this year, Hawaiki Cable announced its sale to BW Digital Pte., an affiliate of BW Group, headquartered in Singapore.