OECD: Foreign Investment Cap Should Be Eliminated

The Organization for Economic Cooperation and Development (OECD) has called on the Mexican government to eliminate the foreign investment cap in Mexican companies to help boost the flow of capital into the telecoms sector, local press reported.

According to local daily La Jornada, OECD analyst Taylor Reynolds considers laws that limit a foreign company's ownership to only a minority stake in Mexican companies as a major obstacle for growth of any industry. In the case of telecoms it leads to monopolies and high telephone rates.

Ironically, Carlos Slim, who owns Mexico's two dominant telecoms operators - fixed line Telmex and mobile operator Telcel - echoed Reynolds' comments in mid-March after meeting with US President George W Bush.

Reynolds, who spoke at a conference hosted by Mexican cable TV industry association Canitec, said that local fixed line rates are especially high.

The US government's Office of the United States Trade Representative has also criticized high interconnection fees in a report issued this month."

Posted to the site on 23rd April 2007