BRIDGETOWN, Barbados-Five countries in the Eastern Caribbean have passed legislation on telecommunications liberalization and set up a regulatory body to oversee competition in the new year.
But while this is being regarded as a late holiday gift by prospective entrants, the incumbent monopoly provider of fixed-line and mobile telephone service, Cable & Wireless, is hinting that such a move, prior to concluding negotiations on its exclusive licenses, might well result in litigation.
The five countries of Dominica, Grenada, St. Lucia, St. Kitts and Nevis, and St. Vincent and the Grenadines formally launched the Eastern Caribbean Telecommunications Authority (Ectel) in St. Lucia in October. This body is charged with regulating potentially divisive issues, such as interconnection, universal service and rate rebalancing.
The five governments appointed a negotiating team headed by St. Lucia’s Communications and Works Minister Calixte George to arrive at an agreed framework with the incumbent carrier, based on which talks would have been completed with the individual island nations to introduce competition.
Cable & Wireless Executive Vice President for the Windward Islands Trevor Clarke told Global Wireless the negotiations began in February 1999, but since November of that year, the Eastern Caribbean negotiating team has not met with the Cable & Wireless team, which he heads, despite approaches at his end.
Clarke said that while some progress has been made, key issues are outstanding.
With the Organization of Eastern Caribbean States (OECS) governments, which includes the countries involved in Ectel along with Antigua and Barbuda and Montserrat, moving to offer licenses and start the liberalization process as early as March or April 2001, Clarke suggested one side had taken a position “that appears to be heading for a legal collision.”
He continued: “The fundamental point here is that Cable & Wireless does not have any license with the OECS. Cable & Wireless has licenses with individual governments, and therefore, we expected and still expect that arrangements for relinquishing those exclusive licenses would fall to negotiations between Cable & Wireless and the individual governments.”
Mobile competitors are expected to be among the early entrants once the market is thrown open. Regulators would be expected to offer at a minimum one competing mobile license to the incumbent. There would also be substantial opportunities for fixed wireless providers, given the region’s unmet demand for basic telephone services, particularly in rural communities.
All the Windward Islands depend heavily on their ailing banana industries, which are floundering under the weight of low international prices and increased competition from cheaper produce in Latin America. Hence, economic diversification into information services, which require competitive telecommunications rates to attract foreign investment, is regarded as urgent.
Cariaccess Communications, a Vincentian-owned wireless and Internet service provider, wants to offer Internet and long-distance services in the Eastern Caribbean and is awaiting formal invitations from the governments.
Anthony Gunn, managing director of Cariaccess Communications, which has operations in North America and Canada, said his company was prepared to set up its own satellite-linked telecommunications system for long-distance traffic, even if Cable & Wireless was not prepared to agree on interconnection in the short term. In addition to offering Internet service, it is also prepared to establish satellite-linked kiosks where individuals could go to make overseas calls.
“Competition in telecommunications will create local innovation in the industry and lead to a wider variety of services at a better price for the consumer,” Gunn told Global Wireless.
Legal battles, going as far as Britain’s Privy Council, have characterized moves toward competition in Dominica. There is no interconnection between Cable & Wireless and the local Dominican cable operator, Marpin Telecoms and Broadcasting, which is offering competitive services. The OECS governments and Cable & Wireless have accepted that negotiations should be the way forward.
Barbados and Cable & Wireless are reported to be negotiating an orderly move to competition, while the United National Congress (UNC), which is expected to form the next government in Trinidad and Tobago, was pushing for competition prior to general elections last December.
