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Journal Title: Telecommunication Journal

Journal Issue: vol. 52, no. 2

Article Title: The missing link: report of the Independent Commission for World Wide Telecommunications Development

Page number(s): pp. 67-71 decided to set up an Independent Com­ mission for World Wide Telecommuni­ cations Development to recommend ways of stimulating the expansion of telecommunications across the world. The Commission, which consists of 17 members from different regions and with a variety of disciplines and expe­ rience, was established in May 1983. We The missing link met five times between October 1983 and November 1984. Report of the Independent Commission for World Wide Given the extensive literature on the Telecommunications Development subject we thought it best, rather than commission further research, to propose remedies. We have focussed our atten­ On 22 January 1985, Sir Donald Mait­ and Spanish editions and is available tion on public telephone systems. land, Chairman of the Independent from the Secretary-Gene.ral, Internatio­ Commission for World Wide Telecom­ nal Telecommunication Union, Place Our task was essentially political in cha­ munications Development formally des Nations, CH-1211 Geneve 20 (Swit­ racter. Of the 600 million telephones in submitted the Report of the Commis­ zerland). the world, three-quarters are concentra­ sion to Mr. R. E. Butler, Secretary-Gen­ ted in nine countries. The remainder are eral of the International Telecommunica­ Introduction distributed unevenly throughout the tion Union (ITU). rest of the world. While telecommunica­ When it met at Nairobi in 1982 the Pleni­ tion is taken for granted as a key factor in The Report, of which we publish a sum­ potentiary Conference of the Internatio­ mary below, exists in French, English economic, commercial, social and cultu­ nal Telecommunication Union (ITU) ral activity in industrialized countries and as an engine of growth, in most developing countries the telecommuni­ cations system is not adequate even to sustain essential services. In many areas The Commission's mandate there is no system at all. Neither in the name of common humanity nor on grounds of common interest is such a Resolution No. 20 disparity acceptable. of the Plenipotentiary Conference of the An expanded world telecommunica­ International Telecommunication Union tions network would benefit both devel­ (Nairobi, 1982) oping and industrialized countries. The process of improving and expanding net­ works in developing countries will Establishment of the Independent create a major market for telecommuni­ International Commission cations equipment. A more comprehen­ for World-Wide Telecommunications Development sive world system will increase interna­ tional traffic to the advantage of the op­ b) lead to progressive achievement of erators. Where information flows so 2.1 to examine the totality of existing self-reliance in the developing world does commerce. More world trade and and possible future relationships be­ and the narrowing of the gap be­ other contacts will increase understand­ tween countries in the field of telecom­ tween the developing and developed ing. An expanded telecommunications munications involving technical coope­ countries; network will make the world a better and ration and a transfer of resources in safer place. order to identify the most successful 2.3 to consider the most cost-effective methods of such transfer; ways in which the Union could stimulate Objective 2 2 to recommend a range of methods and support the range of activities that might be necessary to achieve a more We believe that by the early part of the i~cluding novel ones for stimu~ating next century, virtually the whole of man­ telecommunication development m the balanced expansion of telecommunica­ tion networks; kind should be brought within easy developing world _usi~g appropri~te and reach of a telephone and, in due course, proven technologies m ways whtch: the other services telecommunications a) serve the mutual interest of govern­ 2.4 to complete its work in about a can provide. That should be the over­ year's time; ments, operating companies, t~e riding objective. Achieving this will public and specialized user groups m require a range of actions by indus­ 2.5 to submit its report to the ITU the developing world and of the trialized and developing countries alike. public and private sectors in the Secretary-General. developed countries; and The role of telecommunications Telecommunications have often been neglected in favour of other sectors such

TELECOMMUNICATION JOURNAL- VOL. 52-11/1985 67 as agriculture, water and roads. Tele­ include inadequate equipment and insufficient to meet its overheads. This communications should be regarded as a maintenance, or lack of trained staff. should be remedied. complement to other investments and an essential component in the develop­ In attempting to remedy this situation WE RECOMMEND that contributors to ment process which can raise producti­ operating entities in developing coun­ and beneficiaries of the UNDP reconsi­ vity and efficiency in other sectors and tries face various problems. They may der the importance they attach to the enhance the quality of life in the be unable to find the investment capital telecommunications sector, and provide developing world. to improve and expand the network. appropriate resources for its growth. WE With few exceptions there is no indige­ FURTHER RECOMMEND that all inter­ Telecommunications play an essential nous manufacture of telecommunica­ national organizations concerned with role in emergency and health services, tions equipment. Most of this has to be telecommunications give more favou­ commerce and other economic activi­ bought abroad out of the scarce reserves rable consideration than hitherto to ties, in public administration, and in of hard currency for which, in most assistance for the expansion of telecom­ reducing the need to travel. There is developing countries, there are compet­ munications world-wide and that regio­ moreover a clear link between invest­ ing demands. At the same time, national nal co-operation be accorded a higher ment in telecommunications and econo­ policies can deter inward investment. priority. mic growth. Most equipment is designed for use in The economic and social benefits an advanced countries with temperate cli­ The choice of technology efficient telecommunications system mates and may not suit conditions in The quickening pace of change in tech­ confers on a community or a nation can developing countries where, in any case, nology has widened the range of techni­ be clearly perceived. The system can there may not be enough staff trained to cal options and complicated the choices also be used as a channel for education, install, use and maintain it. Changes in developing countries have to make. The for disseminating information, encour­ manufacturers' products can create pro­ future offers improved quality and new aging self-reliance, strengthening the blems over spare parts for obsolescent capabilities at lower cost. We believe social fabric and sense of national iden­ equipment. that public telecommunications systems tity, and contributing to political stabi­ will over time become wholly digital. lity. The more remote areas of developing The change from analogue to digital will countries pose special difficulties take many years and it is for the operat­ Dramatic technological advances are because of the distances involved, the ing entities in each developing country taking place at a time when the role of terrain and sparse population. Profita­ to take their own decisions. Conditions telecommunications in the process of bility alone is an inappropriate criterion in remote and rural areas suggest that development is more important than for investment in these areas; indiret satellite or radio systems may offer cost­ ever-. In our view no development pro: benefits have to be taken into account. effective solutions. Not enough is being gramme of any country will be balanced, Since telecommunications operators' done to develop this potential. WE properly integrated, or effective unless it main business and source of profit are in RECOMMEND that manufacturers and accords telecommunications an appro­ urban areas, the incentive to invest there operators be encouraged to develop sys­ priate role. will be strong. If the service in these tems which will enable the needs of the areas is neither efficient nor comprehen­ more remote areas of developing coun­ sive, operators may see little point in tries to be met at lower cost. The situation today providing service to remote areas. Telecommunications link all countries. Selection of product can be as important But there is a wide disparity in the extent International co-operation as choice of technology. Buyers must and quality of service as between indus­ know what is available on the market. trialized and developing countries, and While numerous international and WE RECOMMEND that the ITU in con- within developing countries between regional organizations are involved one junction with manufacturers oft~lecom­ urban and remote areas. This reflects way or another in telecommunications, munications equipment and compo­ differences in economic capability, his­ the ITU carries the principal responsibi­ n_ents, consider compiling a comprehen­ torical experience and in the priority lity in this field. We were charged with stve catalogue of telecommunications given to investment in this sector. considering the most cost-effective way suppliers and systems currently in use. in which the ITU could stimulate and Many developing countries have created support the range of activities that might efficient telecommunications systems be needed to achieve a more balanced Internal organization and management extending into the more remote areas. expansion of telecommunications net­ of telecommunications But elsewhere the telephone service is works. Many proble~s o~er availability and far from universal. Three-quarters of the quahty of servtce m developing coun­ world's population live in countries with The role of the ITU could be more effec­ tries ~re ~ymptoms of inadequacies in 10 telephones or less for every 100 per­ tive if the relevant Resolutions of the ·organtzatJOn and management, rather sons; over half live in countries with less ITU Plenipotentiary Conference in Nai­ than shortage of investment finance than one telephone for every 100 persons. robi in 1982 were put into effect, account ~hile _some countri~s have mad~ being taken of the recommendations we Impressive progress m overcoming Uneven distribution of telephones is not make in this Report. these, in others shortcomings persist the only problem. In many developing Many countries cannot be expected t~ countries service may not be available The primary source of funds for the make the necessary improvements even to those close to a telephone ITU's technical co-operation activities is without help. exchange. The service may be out of the United Nations Development Pro­ order for long periods. The causes of gramme (UNDP). In recent years the It is for gove:n~ents to decide whether these and other shortcomings may ITU's income from this source has been telecommuntcatJOns are publicly or Pri-

68 TELECOMMUNICATION JOURNAL· VOL. 52-/111985 vately owned, and whether competition opportunities they offer to developing the scope for co-operation with develop­ should be admitted. But telecommuni­ countries. ing countries in local or regional manu­ cations should be run on business lines facture. as a separate, financially self-sustaining enterprise. It should be properly manag­ Research and development and local ed and planned with effective controls. manufacture A Centre for Telecommunications All stages of planning, procurement and Development installation of capital plant should be Research and development closely monitored. Where possible, pro­ The majority of developing countries As an immediate step to improve the curement should be competitive and depend at present on R & Din industria­ present arrangements for assisting devel­ major procurement decisions should be lized countries. Little of this is directed oping countries, WE RECOMMEND taken openly at senior level. Procure­ to the distinctive needs of the develop­ that a Centre for Telecommunications ment processes should be subject to ing world, for instance for more cost­ Development be established by the independent audit. WE RECOMMEND effective equipment to serve remote Administrative Council of the ITU that developing countries consider pool­ areas. during 1985. The Centre would comprise ing their purchases of appropriate equip­ a Development Policy Unit, which ment including terminals and compo­ R & D geared to developing country would collect and analyse data on poli­ nents. WE ALSO RECOMMEND that, needs will best be undertaken by estab­ cies and experiences from around the when purchasing equipment, develop­ lishments in the developing world. world; a Telecommunications Develop­ ing countries ensure that the contract Some larger countries already have such ment Service organized into teams of includes commitments on the supply of establishments, but most lack the neces­ specialists to offer high calibre advice to spare parts, training, commissioning, sary resources. developing countries on aspects of crea­ post-installation and maintenance. ting and operating an effective public Conditions and needs are often similar network, and an Operations Support throughout a region or subregion and it Training Group, which would provide assistance may be advantageous to create regional with specific projects. The work of the Lack of sufficient trained staff is a major or subregional R & D institutes. These Centre would complement the activities cause of the shortcomings of telecom­ should wherever possible be developed of the Technical Co-operation Depart­ munications in developing countries. out of an existing entitiy and concen­ ment (TCD) of the ITU. Managers, supervisors and staff must be trate on the specialized requirements of thoroughly trained. the countries they serve. They should These functions could cost some 10 mil­ adapt existing designs and use modules lion United States dollars annually. To Most developing countries depend on and components available on the world ensure that the Centre responds to the outside help with training. Much has market. needs and views of its financiers and been done in recent years by the ITU, by beneficiaries, an Advisory Board of 15 to WE RECOMMEND that the major regio­ other international agencies, by oper­ 20 members representing different ators and universities in industrialized nal and subregional political and econo­ mic organizations consider as soon as regions and interests would be set up. and some developing countries. Most This would determine its own rules of major manufacturers provide training in possible how best R& D institutes might be established. procedure, give policy direction to the the operation and maintenance of the Centre, assure its finances and adminis­ equipment they supply. But there is still ter its budget. a gap between telecommunications trai­ ning opportunities and needs in the Local manufacture Members of the Advisory Board would developing world. Manufacture of telecommunications be selected by the Secretary-General in equipment in developing countries consultation with interested parties, and WE RECOMMEND that telecommuni­ reduces foreign exchange problems and appointed by the Administrative Coun­ cations operators in developing coun­ dependence on the major international cil. The Secretary-General, who would tries review their training needs and firms. Equipment and spare parts which be ex o.fflcio Vice-Chairman of the Advi­ resources, and prepare systematic trai­ are needed but are no longer available sory Board, would ensure that the policy ning plans; that developing countries can continue to be produced. guidelines for the Centre laid down by use the resources available through the the Administrative Council were obser­ International Programme for the Devel­ Few developing countries have suffi­ ved, and co-ordinate the efforts of the opment of Communication (IPDC); cient resources or demand to support Centre and the TCD. On the recommen­ that industrialized countries organize manufacture of major high technology dation of the Advisory Board he would seminars to improve the qualifications equipment. Many can and do make appoint the Director and Deputy Direc­ of experts from developing countries; simpler equipment. This should be tor of the Centre. that the research and development (R & encouraged. D) institutes we propose below be devel­ In time the Centre and the TCD could oped as a source of higher technological, Collective manufacturing ventures by be merged. The Advisory Board and the supervisory and managerial training and groups of countries at regional or sub­ Administrative Council should examine as co-ordinating agencies for external regional level should be encouraged. this matter further. training opportunities; that the ITU sup­ plement the catalogue of training oppor­ WE RECOMMEND that developing WE INVITE the Secretary-General of tunities with information about training countries review the possibilities for the ITU to carry out the necessary con­ opportunities in the private sector, and local or regional manufacture. WE FUR­ sultations so that the Centre can be esta­ that operators and manufacturers consi­ THER RECOMMEND that manufactu­ blished as soon as possible in the course der how they can enhance the training rers in industrialized countries consider of 1985.

TELECOMMUNICATION JOURNAL- VOL. 52-1111985 69 Financing the development of telecom­ In order to increase the flow of resources WE RECOMMEND that governments of munications immediately, WE RECOMMEND that industrialized countries review their countries and international agencies financing instruments and institutions If developing countries are to give grea­ with development assistance program­ to ensure that they can meet the financ­ ter priority to telecommunications and mes give higher priority to telecommu­ ing requirements of extending telecom­ to improve and expand their public tele­ nications. munications networks in developing communications networks, we estimate countries. that total investment of 12 billion United WE ALSO RECOMMEND that they States dollars a year will be needed. ensure that specific provision is made WE RECOMMEND FURTHER that for appropriate telecommunications· Member States of the ITU, in collabora­ The dimensions of the financing pro­ facilities in development assistance pro­ tion with international finance agencies, blem would be reduced if the recom­ jects. study the possibility of a revolving fund mendations already made in this Report WE RECOMMEND FURTHER that and of telecommunications investment were implemented. An effective tele­ those who provide international satellite trusts as methods of raising funds for communications system which meets systems study urgently the feasibility of investment in telecommunications, demand not only is inherently profitable establishing funds to finance earth seg­ with a view to putting these ideas into but also generates wealth. Technologi­ ment and terrestrial facilities in develop­ effect by the next Plenipotentiary Con­ cal advance continues to widen choice ing countries. ference at the latest. The Secretary­ and drive down the cost of equipment. General of the ITU is invited to report to Developing countries who represent a To increase awareness of the essential the Plenipotentiary Conference on pro­ fast-growing and potentially the largest role telecommunications play in devel­ gress made with these studies. equipment market are well placed to opment, WE APPEAL to the govern­ obtain the benefits of modern telecom­ ments participating in the next econo­ WE RECOMMEND that the Secretary­ munications from manufacturers in mic summit to give encouragement to General of the ITU, in the light of pro­ industrialized countries on competitive practical measures to improve and gress on our other recommendations, prices and terms. expand telecommunications. study the idea of an organization to co­ As a means of reducing trade risks in the ordinate the development of telecom­ ACCORDINGLY WE RECOMMEND telecommunications sector and the cost munications world-wide (WORLDTEL) that developing countries review their of insuring against these, WE RECOM­ and submit his conclusions to the Pleni­ development plans to ensure that suffi­ MEND that industrialized countries potentiary Conference. cient priority is given to investment in extend export/import financing and telecommunications. WE RECOMMEND that the Secretary­ insurance cover to suppliers of telecom­ General of the ITU monitor the imple­ WE FURTHER RECOMMEND that munications equipment. WE ALSO mentation of all the preceeding recom­ developing countries make appropriate RECOMMEND that the International mendations, report on progress to the provision for telecommunications in all Bank for Reconstruction and Devel­ Administrative Council and, where projects for economic or social advance opment (IBRD) consider including necessary, act to stimulate further pro­ and include in their submissions a telecommunications in its proposal for gress. check-list showing that such provision is multilateral guarantees against non­ being made. commercial risks. Where projects are financed in part by IBRD loans WE The expansion of telecommunications RECOMMEND that finance agencies Conclusions world-wide should take place in stages . consider cross-default arrangements as a We look to governments of industrializ­ over a period of some twenty years. form of insurance. ed and developing countries alike to Rather than generalize the problem, Operating entities in industrialized recognize their common interest in each country, or region at least, has to be countries which provide international improving and expanding telecommuni­ seen as an individual case. Some coun­ telecommunication services have an cations networks world-wide. We appeal tries have long been regarded as special interest in improving the ability of their for a joint effort to this end. In particular cases. Some may be able to finance counterparts in developing countries to higher priority than hitherto should be expansion from their own resources. handle international traffic effectively. given to investment in telecommunica­ However, there are others so disadvanta­ WE RECOMMEND that Member States tions. Existing networks in developing ged geographically or economically that of the ITU consider setting aside a small countries should be made more efficient they will not find it easy to develop and proportion of revenues from calls be­ and increasingly self-reliant. The bene­ sustain a telecommunications system to tween developing countries and indus­ fits of the new technologies should be meet demand, except in the longer term. trialized countries to be devoted to tele­ fully exploited. Financing arrangements In the main, developing countries share communications in developing coun­ should take account of the foreign many problems-scarcity of foreign cur­ tries or contributed for example to a exchange problems of developing coun­ rency, low credit ratings, comparative fund to finance pre-investment costs. tries. The role of the ITU should be neglect of the more remote areas and more effective. lack of trained personnel. We have examined other methods of financing that would take time to put The recommendations we have made While it is reasonable to suppose that a into effect. For example, a surcharge reflect this analysis of the problem. high proportion of investment in tele­ might be raised on domestic or interna­ There is no single remedy. A range of communications in many developing tional taffic or on expenditure on invest­ actions over a wide front is required. countries can be financed by commer­ ment. This and other ideas require fur­ Progress will be made. only in stages. But cial means, provided the right condi­ ther analysis and we hope that industria­ if the effort is sustained the situation tions can be created, the disadvantaged lized and developing countries and world-wide will be transformed in 20 countries and more remote areas will international agencies will contribute to years and the objective we have set require finance on concessionary terms. the debate. achieved.

70 TELECOMMUNICATION JOURNAL- VOL. 52- 111/985 Members of the Independent Commission for World Wide Telecommunications Development

PROFESSOR DR. SUKHAMOY CHAKRAVARTY DR. MANUEL PEREZ GUERRERO Chairman, Advisory Council to the Prime Minister Minister of State for International and Economic Affairs Planning Commission Venezuela India MR. JEAN PING MR. WILLIAM M. ELLINGHAUS Director of the President's Office of the Gabonese Republic Former President, American Telephone and Telegraph Gabon Company (AT&T) United States MR. ALIOUNE StNE Ambassador of Senegal in Switzerland and Permanent MR. ABouL RAHMAN K. AL-GHUNAIM (Vice-Chairman) Representative of Senegal to the United Nations Office in Under-Secretary, Ministry of Communications Geneva Kuwait Senegal

DR. KoJI KosAYASHI PROFESSOR DR. ALEXANDRU SPATARU Chairman of the Board and Chief Executive Officer Head of the Applied Electronics Department NEC Corporation Bucharest Politechnical Institute Japan Romania

DR. VoLKMAR K6HLER MR. AcHMAD T AHIR (Vice-Chairman) Parliamentary Secretary of State of the Federal Minister for Minister of Tourism, Posts and Telecommunication Economic Co-operation Indonesia Federal Republic of Germany PROFESSOR DR. LEONID E. VARAKIN MR. MOHAND LAENSER Rector Minister of Posts and Telecommunications All-Union Telecommunication Institute by Correspon­ Morocco dence Ministry of Posts and Telecommunications MR. LoUis-JosEPH LIBOIS USSR Chairman, Caisse nationale des telecommunications (CNT) MR. ARMANDO VARGAS ARAYA (Vice-Chairman) France Minister of Information and Communications Costa Rica SIR DONALD MAITLAND, GCMG, OBE (Chairman) United Kingdom DR. F AISAL ZAIDAN MR. J. S. MALECELA, MP (Vice-Chairman) Deputy Minister of Telephones Minister for Communications, Transport and Works Ministry of Posts, Telegraphs and Telephones Tanzania Saudi Arabia

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