- Email: [email protected]
Demonstrating a commitment to the developing world
Confererlce reporrs
expand into many other activities, a description which reminded me of ‘Worlds in Collision’. Mr Ian Angus, President, Angus TeleManagement of Toronto, gave a talk on how small businesses, particularly in the Toronto area, were using telecommunications services strategically. Mr Bill Slysz, President of North Atlantic Computing Limited, then described various applications of telecommunications and personal computers to rural areas in the Maritime provinces. The conference concluded with a talk by Mr Christopher Scott, President of TIEM Canada. who called for more small business policies to aid in the restructuring and growth of regional information economies. A significant segment of this session on business focused on telecommunications, banking and financial services. Speakers included Mr Richard Crooker, Vice-President, Transaction Services at American Express Canada Inc, Mr John Roberts, General Manager, Canadian Payments Association. and Mr Pierre Paquette, Vice-President of consumer services at Banque Nationale du Canada. The luncheon speech was given by Mr Jim Grant, Senior VicePresident, Royal Bank of Canada, who described the strategic nature of telecommunications to the future of international banking and financial services. The consensus of this session was that telecommunications was making it possible to do so many more things strategically and in an increasing variety of ways and that more and more business activities and their competitive position will be determined by the ways in which they design and use their telecommunications resources. The conference was an unqualified success, and exceeded the high expectations and objectives set out for it. A summary of conclusions emerging from the conference is as follows:
0
0
90
telecommunications is one of several pillars of the evolving information economy and is critical to the evolution of this new economy; telecommunications is playing an increasingly important role in urban, regional and international economic development;
a
0
0
the time has come to integrate telecommunications into the urban, regional and international economic development planning and policy making processes; telecommunications is rapidly becoming a major factor in determining the competitive position of small- and medium-sized and multinational corporations. particularly in the service industries; the tremendous complexity of the issues will prohibit quick solutions to the enormous challenges
0
facing all levels of government and the business community; an agreement on international trade in services will not be achieved without major changes in political attitudes and institutional changes; this may take a decade or more.
Department
Maurice Estabrooks of Communications Ottawa, Ontario Canada
Demonstrating a commitment to the developing world Telecommunications for Development York, 28 October 1986 A forum on ‘Telecommunications for development: exploring new strategies’, sponsored by INTELSAT, was held in New York City on 28 October 1986. Attendees included representatives of bilateral and multilateral aid agencies, UNDP, UNESCO, and the ITU, financial institutions, consulting organizations, telecommunications firms, developing country governments and academics. The keynote address, by INTELSAT Director-General Richard Colino, was entitled ‘Bridging the gap strategies for achieving global telecommunications development’. He cited 10 ideas for telecommunications development. Five of these ideas involved financing techniques, including a financing plan to assist developing countries to join INTELSAT (discussed in greater detail below), countertrade, piggybacking on commercial interests to extend rural services. regional sharing of costs, and subscriber capitalization. His second group of ideas concerned effective use of capital, including selection of appropriate improved training and technology, management, a holistic approach to financing of software as well as hardware, timesharing of capacity for telephony and broadcasting, and aggrega-
Forum, sponsored
by INTELSAT,
New
tion of demand to reduce prices and stimulate development of appropriate technology. Many of these themes were elaborated in subsequent presentations, several of which focused on financing techniques. Robin Hoen, Executive Vice President of Equator Bank, a merchant bank which operates exclusively in Africa, described its approach to providing the capital for non-member African countries to join INTELSAT. Briefly, Equator will advance the approximately $SSO 000 a country needs for the smallest permissible share in INTELSAT (OS%), in return for a guaranteed payback from the revenue stream generated by the country’s usage of INTELSAT. It was suggested that this approach might be used to finance other telecommunications investments in developing countries. Steven de Got, Senior Vice President of ContiTrade Services, outlined several approaches to countertrade. His company can facilitate business between telecommunications suppliers and developing countries which need to trade in commodities (eg copper, soybeans or coffee) rather than directly in foreign exchange. The countertrader will assess the value of
TELECOMMUNICATIONS
POLICY March
1987
Conference rrporrs
the commodity and find a market for it, guaranteeing the necessary payment in hard currency to the equipment supplier. E. Melrose. Director of Technology for the International Bureau for Informat&, described its projects using INTELNET micro-Earth stations for data communications. as an example of how needs of private and public users may be coordinated to encourage investment in low-cost systems for rural services. K. Apetey, Chief of the Industries Department of the African Development Bank, summarized the ADB’s history of telecommunications investments. The ADB is currently contributing to the pre-feasibility study for an African regional satellite which is being coordinated by the International Telecommunication Union. Richard Stern of the World Bank summarized the Bank’s recent activities in telecommunications funding, and was optimistic about the possibilities of the Bank’s participation in syndicated financing packages involving a variety of sources of capital. On a less optimistic note, Jean-Claude Delorme, Chairman of the Board of the ITU’s Centre for Telecommunications Development, reported that an executive director and deputy director had now been hired. However, he said, total commitments for financial contributions to date total $1.2 million, whereas an estimated $5 million per year would be needed. Other speakers covered a range of topics. Charles Jonscher of CSP International summarized results of a recent case study in Costa Rica on the contribution of investment in rural telecommunications to economic development. Professor Bella Mody of Michigan State University presented a paper on ‘How Third World countries make satellite adoption decisions’, using the example of India to point out the variety of institutional and political factors which may influence the decision to adopt satellite technology and the utilization of the system. Other papers addressed telecommunications investment in India, the Caribbean and the South Pacific. The luncheon address on ‘The role of the United Nations Development
TELECOMMUNICATIONS
Programme in telecommunications investment’ was delivered by UNDP Administrator William H. Draper III. previously a Silicon Valley venture capitalist. Perhaps Mr Draper’s professional experience can aid in the search for new approaches to financing of Third World telecommunications. For the approximately 200 invited attendees, the conference packed a great deal of information and several innovative financing ideas into one day. The proceedings, to be published by INTELSAT, will be a valuable contribution to the post-Maitland
Commission efforts to increase telecommunications investment in developing countries. One was left to speculate, however, on why INTELSAT chose to sponsor a conference on this theme at this particular time. Could it be that a demonstrable commitment to the developing world will be an asset in the continuing debate over the introduction of competition in international satellite services?
Heather E. Hudson University of Texas Austin, TX, USA
‘The missing link’ in Africa Africa Telecom 86: Bridging the Missing Link, organized by the Kenya Posts and Telecommunications Corporation and the International Telecommunication Union, Nairobi, Kenya, 16-23 September 1986
Africa Telecom was organized by the ITU and the Kenya Posts and TeieCorporation, and communications held in Nairobi in September 1986. It consisted of a four-day conference and a concurrent exhibition for eight days with emphasis on the needs of Africa. This was one of a series of regional events to follow up on the Maitland Commission study of the telecomneeds of developing munications countries and its report entitled The Missing LitIk The conference attracted 350 attendees from 56 countries. The exhibition was also well supported by suppliers from around the world. The host country, Kenya, had much the largest delegation (S6), as would be expected, followed by the USA and Japan (over 30 each) and then the larger European countries (l&--20 each). The conference sessions were divided into General Policy and Economic Issues where the contributions from developing and developed countries were relatively evenly balanced (17 and 22 respectively), and Technical Seminars which covered rural, ISDN and broadcasting mobile. aspects. These were mostly from developed countries (21 against 3). Prac-
POLICY March 1987
tical examples of these technical subjects were demonstrated in the exhibition. The format was to have five or six presentations in a session, which strained the concentration of the audience and provided limited scope for feedback. It was thus difficult to judge during the sessions how helpful the event was for the attendees and how fully they covered the continentalwide interests of Africa.
Sober A few of the most noteworthy presentations were by Mr Ouko (Minister for Economic Planning and Development for Kenya) and by Mr Okello (Deputy Coordinator, Africa Transport and Communications Decade, Economic Commission for Africa) and Mr Tedros (ITUIPANAFTEL Coordinator, Ethiopia). who eloquently expressed some of the realities of the current African situation. In a speech on ‘Criteria of government decisions in developing countries covering telecommunication investment’, Mr Ouko pointed out that one-quarter of Kenya’s population was under the age of six, and half the
91
expand into many other activities, a description which reminded me of ‘Worlds in Collision’. Mr Ian Angus, President, Angus TeleManagement of Toronto, gave a talk on how small businesses, particularly in the Toronto area, were using telecommunications services strategically. Mr Bill Slysz, President of North Atlantic Computing Limited, then described various applications of telecommunications and personal computers to rural areas in the Maritime provinces. The conference concluded with a talk by Mr Christopher Scott, President of TIEM Canada. who called for more small business policies to aid in the restructuring and growth of regional information economies. A significant segment of this session on business focused on telecommunications, banking and financial services. Speakers included Mr Richard Crooker, Vice-President, Transaction Services at American Express Canada Inc, Mr John Roberts, General Manager, Canadian Payments Association. and Mr Pierre Paquette, Vice-President of consumer services at Banque Nationale du Canada. The luncheon speech was given by Mr Jim Grant, Senior VicePresident, Royal Bank of Canada, who described the strategic nature of telecommunications to the future of international banking and financial services. The consensus of this session was that telecommunications was making it possible to do so many more things strategically and in an increasing variety of ways and that more and more business activities and their competitive position will be determined by the ways in which they design and use their telecommunications resources. The conference was an unqualified success, and exceeded the high expectations and objectives set out for it. A summary of conclusions emerging from the conference is as follows:
0
0
90
telecommunications is one of several pillars of the evolving information economy and is critical to the evolution of this new economy; telecommunications is playing an increasingly important role in urban, regional and international economic development;
a
0
0
the time has come to integrate telecommunications into the urban, regional and international economic development planning and policy making processes; telecommunications is rapidly becoming a major factor in determining the competitive position of small- and medium-sized and multinational corporations. particularly in the service industries; the tremendous complexity of the issues will prohibit quick solutions to the enormous challenges
0
facing all levels of government and the business community; an agreement on international trade in services will not be achieved without major changes in political attitudes and institutional changes; this may take a decade or more.
Department
Maurice Estabrooks of Communications Ottawa, Ontario Canada
Demonstrating a commitment to the developing world Telecommunications for Development York, 28 October 1986 A forum on ‘Telecommunications for development: exploring new strategies’, sponsored by INTELSAT, was held in New York City on 28 October 1986. Attendees included representatives of bilateral and multilateral aid agencies, UNDP, UNESCO, and the ITU, financial institutions, consulting organizations, telecommunications firms, developing country governments and academics. The keynote address, by INTELSAT Director-General Richard Colino, was entitled ‘Bridging the gap strategies for achieving global telecommunications development’. He cited 10 ideas for telecommunications development. Five of these ideas involved financing techniques, including a financing plan to assist developing countries to join INTELSAT (discussed in greater detail below), countertrade, piggybacking on commercial interests to extend rural services. regional sharing of costs, and subscriber capitalization. His second group of ideas concerned effective use of capital, including selection of appropriate improved training and technology, management, a holistic approach to financing of software as well as hardware, timesharing of capacity for telephony and broadcasting, and aggrega-
Forum, sponsored
by INTELSAT,
New
tion of demand to reduce prices and stimulate development of appropriate technology. Many of these themes were elaborated in subsequent presentations, several of which focused on financing techniques. Robin Hoen, Executive Vice President of Equator Bank, a merchant bank which operates exclusively in Africa, described its approach to providing the capital for non-member African countries to join INTELSAT. Briefly, Equator will advance the approximately $SSO 000 a country needs for the smallest permissible share in INTELSAT (OS%), in return for a guaranteed payback from the revenue stream generated by the country’s usage of INTELSAT. It was suggested that this approach might be used to finance other telecommunications investments in developing countries. Steven de Got, Senior Vice President of ContiTrade Services, outlined several approaches to countertrade. His company can facilitate business between telecommunications suppliers and developing countries which need to trade in commodities (eg copper, soybeans or coffee) rather than directly in foreign exchange. The countertrader will assess the value of
TELECOMMUNICATIONS
POLICY March
1987
Conference rrporrs
the commodity and find a market for it, guaranteeing the necessary payment in hard currency to the equipment supplier. E. Melrose. Director of Technology for the International Bureau for Informat&, described its projects using INTELNET micro-Earth stations for data communications. as an example of how needs of private and public users may be coordinated to encourage investment in low-cost systems for rural services. K. Apetey, Chief of the Industries Department of the African Development Bank, summarized the ADB’s history of telecommunications investments. The ADB is currently contributing to the pre-feasibility study for an African regional satellite which is being coordinated by the International Telecommunication Union. Richard Stern of the World Bank summarized the Bank’s recent activities in telecommunications funding, and was optimistic about the possibilities of the Bank’s participation in syndicated financing packages involving a variety of sources of capital. On a less optimistic note, Jean-Claude Delorme, Chairman of the Board of the ITU’s Centre for Telecommunications Development, reported that an executive director and deputy director had now been hired. However, he said, total commitments for financial contributions to date total $1.2 million, whereas an estimated $5 million per year would be needed. Other speakers covered a range of topics. Charles Jonscher of CSP International summarized results of a recent case study in Costa Rica on the contribution of investment in rural telecommunications to economic development. Professor Bella Mody of Michigan State University presented a paper on ‘How Third World countries make satellite adoption decisions’, using the example of India to point out the variety of institutional and political factors which may influence the decision to adopt satellite technology and the utilization of the system. Other papers addressed telecommunications investment in India, the Caribbean and the South Pacific. The luncheon address on ‘The role of the United Nations Development
TELECOMMUNICATIONS
Programme in telecommunications investment’ was delivered by UNDP Administrator William H. Draper III. previously a Silicon Valley venture capitalist. Perhaps Mr Draper’s professional experience can aid in the search for new approaches to financing of Third World telecommunications. For the approximately 200 invited attendees, the conference packed a great deal of information and several innovative financing ideas into one day. The proceedings, to be published by INTELSAT, will be a valuable contribution to the post-Maitland
Commission efforts to increase telecommunications investment in developing countries. One was left to speculate, however, on why INTELSAT chose to sponsor a conference on this theme at this particular time. Could it be that a demonstrable commitment to the developing world will be an asset in the continuing debate over the introduction of competition in international satellite services?
Heather E. Hudson University of Texas Austin, TX, USA
‘The missing link’ in Africa Africa Telecom 86: Bridging the Missing Link, organized by the Kenya Posts and Telecommunications Corporation and the International Telecommunication Union, Nairobi, Kenya, 16-23 September 1986
Africa Telecom was organized by the ITU and the Kenya Posts and TeieCorporation, and communications held in Nairobi in September 1986. It consisted of a four-day conference and a concurrent exhibition for eight days with emphasis on the needs of Africa. This was one of a series of regional events to follow up on the Maitland Commission study of the telecomneeds of developing munications countries and its report entitled The Missing LitIk The conference attracted 350 attendees from 56 countries. The exhibition was also well supported by suppliers from around the world. The host country, Kenya, had much the largest delegation (S6), as would be expected, followed by the USA and Japan (over 30 each) and then the larger European countries (l&--20 each). The conference sessions were divided into General Policy and Economic Issues where the contributions from developing and developed countries were relatively evenly balanced (17 and 22 respectively), and Technical Seminars which covered rural, ISDN and broadcasting mobile. aspects. These were mostly from developed countries (21 against 3). Prac-
POLICY March 1987
tical examples of these technical subjects were demonstrated in the exhibition. The format was to have five or six presentations in a session, which strained the concentration of the audience and provided limited scope for feedback. It was thus difficult to judge during the sessions how helpful the event was for the attendees and how fully they covered the continentalwide interests of Africa.
Sober A few of the most noteworthy presentations were by Mr Ouko (Minister for Economic Planning and Development for Kenya) and by Mr Okello (Deputy Coordinator, Africa Transport and Communications Decade, Economic Commission for Africa) and Mr Tedros (ITUIPANAFTEL Coordinator, Ethiopia). who eloquently expressed some of the realities of the current African situation. In a speech on ‘Criteria of government decisions in developing countries covering telecommunication investment’, Mr Ouko pointed out that one-quarter of Kenya’s population was under the age of six, and half the
91