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  • Print publication year: 2003
  • Online publication date: September 2009

8 - International trade in telecoms services

Summary

Until the mid-1980s, telecoms services and international trade and investment were viewed as separate realms of policy activity. Domestic policy and regulations were developed by governments within the parameters of national telecoms carriers to provide a technologically narrow range of services under monopolistic arrangements. International concerns were confined to matters of interconnection, standards, and rate setting, and were handled cooperatively through the international consultative committees of the International Telecommunication Union or through bilateral agreements among providers of international services Ergas and Paterson (1991).

However, as telecoms services have become increasingly internationalized, a host of regulatory impediments to international trade and investment in such services have come to light. Many of the barriers affecting telecoms services are similar to those affecting other services, in that laws and regulations impede the ability of producers and consumers to interact across borders through cross-border trade or foreign direct investment Hill (1977; Sampson and Snape 1985). Other barriers, specific to telecoms, involve the effective regulation of the dominant carrier Noll (1994; Scanlan 1994; Hoekman, Low, and Mavroidis, 1996).

The process of applying international trade disciplines to these impediments has commenced with the General Agreement on Trade in Services (GATS). This process has been facilitated by domestic deregulation in many telecoms markets around the world. In East Asia the deregulation and liberalization of the telecoms industry has been extensive in recent years, with most economies now accepting that increased competition is a prerequisite for the industry's development and growth.

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