Preamble

The telecommunications industry is in the midst of a revolution that is dramatically changing the way in which services are provided and the expectations of consumers. Technology is reducing costs and enabling new capabilities. Market liberalization, with the introduction of competition, will accelerate the pace at which customers are able to reap the benefits of these capabilities.

The Pacific Basin, with its great market potential and large opportunities, is becoming a critical venue for this drama to unfold. Surging economic development, expanded trade, unparalleled business investment and leading edge technology are all behind a growing demand for telecommunications products and services that is taxing the limits of the existing infrastructure.

Position

It is important to recognize that all PBEC members have a vested interest in encouraging competitiveness and growth in this region. As providers and consumers of telecommunications services, members of PBEC believe that a robust, vibrant, competitive environment will bring new investment and jobs, spur economic growth and position the region favorably in global markets. Users will have access to new and innovative services, with competitive choices and lower rates. Market liberalization is in the best interest of PBEC members, particularly those in developing economies where telephone penetration is low and the business community is disadvantaged by outdated, expensive, and inefficient information and telecommunications services.

PBEC believes that liberalization of Pacific Basin telecommunications markets will enable the region to participate actively in the telecommunications revolution and capitalize on the benefits of an increasingly global economy.

Market liberalization will increase the demand for telecommunications services, which will in many cases require significant network expansion and upgrades, along with administrative reforms. To enable the industry to accommodate the increased demand, a substantial amount of capital investment in new infrastructure will be required. A critical element to be factored into all infrastructure investment decisions will be the existence of a nurturing, independent and transparent regulatory regime. The region will benefit significantly if foreign capital and resources are allowed to participate in the process.

PBEC opposes restrictions on foreign investment in the industry.

In addition, consumers should not be expected to continue subsidizing inefficient operators through maintenance of above-cost accounting rates.

PBEC also urges reform in the international telecommunications settlements process so that the price of calling can be reduced.

A landmark new trade regime for provision of basic telecommunications services has been established under the auspices of the WTO General Agreement on Trade in Services (GATS). In addition to addressing the introduction of competition into the basic services market, a key aspect of the agreement is the Reference Paper. This paper sets out the key regulatory requirements to ensure the fair administration of competitive markets, including safeguards against non-competitive behavior on the part of major suppliers of services, rights of new market entrants to non-discriminatory interconnection, competitively-neutral universal service obligations, establishment of independent regulators, and non-discriminatory procedures for the allocation and use of scarce resources. Implementation of these provisions will help to assure that the marketplace is structured to nurture and promote competition in this important industry.

PBEC encourages all countries in the region to open their markets fully, and for WTO members with existing offers to support the GATS agreement by implementing their commitments in a timely manner while simultaneously enacting all of the regulatory principles outlined in the Reference Paper.

Endorsed by the PBEC Steering Committee 05/24/98
Adopted by the PBEC Board of Directors 05/24/98