WTO DG Lamy Celebrates Benefits of Opening Trade in Telecoms

World Trade Organisation Director-General Pascal Lamy has hailed liberalisation of trade in telecoms services as a vital tool in economic growth and development on the occasion of the WTO Symposium on Telecommunications organized in Geneva to commemorate the 10th anniversary of agreement among WTO members to open basic telecommunications services.

"The impressive results we have seen in 10 years of opening telecommunications markets shows how crucial liberalising services trade can be for economies. It is a good reminder to all of the importance of accelerating the services negotiations that are so vital to the success of the Doha Development round," said Mr. Lamy.

"Since the results came into force ten years ago this month, global access to telecommunications has increased from below 15 percent in 1996 to above 60 percent in 2006, and revenues have risen from US$620 billion to US$1.4 trillion during the same period. Telecommunications are an essential prerequisite for a wide range of economic activities in any national economy, developing or developed, from agriculture, travel and tourism to mining and manufacturing. Opening telecommunications has been a win-win game," said Mr. Lamy.

The WTO cites the following as some of the significant developments over the last decade or so in global telecommunications services sector:

• Reforms often galvanized and locked into place by WTO commitments have led to substantial reductions in prices for international calls. For example, the cost of a three-minute call from Mauritius to London declined by over 60% between 2000 and 2006.
• Reforms have also increased global teledensity from below 15% in 1996 to above 60% in 2006. Mobile services, in particular, connected many more people. By the end of 2006, mobile phone subscribers had increased 20 fold, representing 70% of all telephone subscribers. In Africa, for example, mobile growth rates are now over 50% annually, among the highest in the world. For example, average mobile subscriptions increased 200% annually in Liberia and 250% in Niger between 2001-2006.
• Also, between 1996 and 2006, world telecom services revenues increased from US$620 billion to over US$1.4 trillion and internet use increased by 1500%. By 2006, Internet user penetration had risen well above the world average of about 8%, reaching 24% in Peru, 20% in Morocco and 17% in Vietnam, compared with their single digit rates only a few years ago (approx 7% for Peru and 1% for Morocco and Vietnam in 2001).
• Information and communication technologies (ICT) development generated by telecom reform accounts for a growing share of investment and trade. In Egypt, for example, mobile subscriptions increased by 45% per year and Internet users grew from 600 thousand to over six million from 2001- 2006 and the Egyptian ICT sector's success in attracting foreign investment and outsourcing contracts resulted in US$548 million in exports of communications, computer and information services in 2006.
• Small and medium-sized enterprises also benefit. Today, for example, a barber in South Africa can now deposit his customer receipts over a mobile phone by means of "M-banking", rather than spend several hours of his time walking to the nearest bank.

Posted to the site on 24th February 2008

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