Trade in information and communication services: Uganda Case Study by Michael Minges

Trade in Information & Communication Services: Opportunities for East & Southern Africa

Uganda Case Study

A World Bank project carried out by Telecommunications Management Group, Inc.

October 3, 2007

Trade in Information and Communication Services: Uganda Case Study

Contents

Background ICT Competitiveness ICT and Trade ICT and WTO

Trade in Information and Communication Services: Uganda Case Study

Background A World Bank project to analyze opportunities for ICT-related trade for six East and Southern African nations: Ethiopia Kenya Rwanda Sudan Tanzania Uganda

Trade in Information and Communication Services: Uganda Case Study

ICT-related trade

 Around 300 million minutes of incoming international calls (UCC, 2007)

 US$ 5.7 million of Computer & Information services exports

ICT trade (e.g., international phone calls, surfing overseas web sites, e-mail)

(Bank of Uganda 2003/04)

ICT-enabled trade (e.g., call centers, data processing, etc., for overseas clients)

 US$ 17 million in communication services exports

(Bank of Uganda, 2003/04)

 11 % of Ugandan firms using website to interact with Buyers/ Suppliers/ Customers (World Bank 2006)

ICT-facilitated trade (e.g., exporter using website for product sales)

Trade in Information and Communication Services: Uganda Case Study

ICT-ENABLED SERVICES – WHY IS IT IMPORTANT? Government

Enhances economy, investment, and employment

Academia

Provides new curriculum and academic programs and new job opportunities to graduates

Industry

Fosters development of new domestic and foreign companies and enhances opportunities for existing industries

Citizens

Provides new job opportunities for citizens with multiple levels of experience (e.g., secondary schooling and more advanced training)

Trade in Information and Communication Services: Uganda Case Study

ICT COMPETITIVENESS ICT-competitiveness refers to a country’s capability to exploit information and communication technology in order to effectively participate in the global information economy

Business Environment

ICT Infrastructure

ICT Competitiveness

Human Resources

ICT Laws

Trade in Information and Communication Services: Uganda Case Study

…but little wait

Low penetration…

Delays in obtaining a fixed line (days)

2003

2004

2005

Ethiopia (2002)

Kenya (2003)

Rwanda (2006) $8

$13

$15

Kenya

$13

Uganda

2002

155

Tanzania

44%

Rwanda

93%

SSA

82%

Ethiopia

2001

Monthly basket, US$, 2007

Sudan

Faults cleared by next day

40%

…but expensive

Good quality… 70%

SSA

Sudan

23 Tanzania (2006)

1.7

Uganda (2006)

1.8

SSA

Uganda

1.0

Ethiopia

0.5

0.9

Kenya

0.3

0.4 Tanzania

Main lines (per 100 people), 2006

Rwanda

Source: TMG, Inc. adapted from UCC, UTL & “Doing Business”.

Fixed line metrics

Trade in Information and Communication Services: Uganda Case Study

International voice 1-minute peak rate call to USA, US$, 2007

VoIP

$0.60 $0.49 $0.45 $0.44

Sudan

Rwanda

Uganda

Kenya

$0.22

$0.28

Tanzania

$1.08

Ethiopia

Uganda’s international voice tariffs within average range of Study Countries Importance of VoIP for call centers

Trade in Information and Communication Services: Uganda Case Study

Mobile metrics …good coverage

Relatively competitive…

3,768

Tanzania

96 Uganda

4,130

Sudan

92 Kenya

5,236

Uganda

82 Rwanda

6,089

Kenya

Mobile subscribers (per 100 people), 2006 3.0

8.4

10.5 12.5 14.1

Ethiopia

Rwanda

Uganda

Sudan

21.4 Kenya

1.2

Tanzania

SSA*

$5 Sudan

Tanzania

Uganda

60 Sudan

9,059

Rwanda Kenya

…relatively low access

Monthly basket, US$, 2007 $10 $12 $11 $9 Rwanda

Ethiopia

10,000

Ethiopia

Average price…

Tanzania

Mobile coverage (% population), 2006

HHI, 2006

Trade in Information and Communication Services: Uganda Case Study

Internet metrics …average bandwidth

Reasonably competitive…

Bits per person, 2006 22

Kenya

…average access 3.7

3.8

8.2

Uganda

Sudan

Kenya

1.0

2.2 Rwanda

0.4

Tanzania

Internet users (per 100 people), 2006

Ethiopia

Sudan

Rwanda

Kenya

Tanzania

Uganda

Ethiopia

ADSL prices, 256 kbps, US$, 2007 $354 $300 $256 $101 $48

10 Sudan

Tanzania

Expensive…

9 Uganda

6 Rwanda

1 Ethiopia

2.1

Kenya

Tanzania

Uganda

Sudan

Rwanda

Ethiopia

People per ISP, millions, 2006 75 2.3 2.3 4.5 3.6

Trade in Information and Communication Services: Uganda Case Study

Proposed East African undersea fiber optic cable systems Name

Cost (US$ million)

EASSy

235

Kenya, Tanzania, Sudan, others Supply contract signed 3/07

TEAMS

100

Kenya, UAE

Governments of Kenya and UAE.

SEACOM

300

Kenya, Madagascar, Mozambique, South Africa, Tanzania

Herakles Telecom is leading the project

Kenya, Madagascar, Mauritius, Mozambique, South Africa, Tanzania

Spearheaded by Reliance.

FLAG NGN System 2

1,500

Landing points

Note

(Reliance’s investment for connecting four regions around the world)

Trade in Information and Communication Services: Uganda Case Study

Computer market-Services Computer services revenue As % of GDP, 2005 0.55% 0.44%

Kenya

Tanzania

0.36%

Uganda

0.33%

Ethiopia

According to one source, there were around 150 registered firms in the sector in 2002. Computer software and services revenue were estimated at US$ 37 million in 2005, 0.36% of GDP. A survey found that 17 Ugandan ICT firms were providing ICT export-oriented services such as call centers, software development, training, website design, data processing and consultancy.

Source: Adapted from BMI-T, 2006.

Trade in Information and Communication Services: Uganda Case Study

Computer market-Hardware Some 28,000 computers were sold in Uganda in 2005 and by the end of 2005, penetration of computers was estimated at 0.61 per 100 inhabitants, just below the average of 0.65 in the Study Countries. No local manufacturing of computers; however, computer assembly has grown in Uganda due to the elimination of tariffs on parts and reportedly some are even exported to other East African nations.

Imports of office machines & automatic data processing machines, US$ millions

$50

$21

2001

$38

$37

2003

2004

$25

2002

Source: UBOS.

2005

Trade in Information and Communication Services: Uganda Case Study

ICT sector contribution to GDP Telecom revenue as % of GDP, 2005

4.2% 4.8% 4.1% 4.3%

Source: BoU.

3.4%

3.4% 2.7%

2.5% 1.6%

2004

2005

Kenya

2003

Sudan

2002

Tanzania

2001

Uganda

2000

Rwanda

1.0%

1.3%

Ethiopia

1.8%

Source: TMG, Inc. estimates.

Communications sector as % of GDP, Uganda

Trade in Information and Communication Services: Uganda Case Study

ICT sector-Trade Services exports (excluding travel & transport), US$ million

Office & telecom equipment imports, US$ millions $120

$100 $81

$90

$84

$62

$67 $53

$13

2000 2001 2002 2003 2004

2002

Source: WTO.

2003

2004

2005

Trade in Information and Communication Services: Uganda Case Study

ICT Institutions Ministry of Information and Communications Technology Uganda Communications Commission National Information Technology Authority (to be established)

Trade in Information and Communication Services: Uganda Case Study

ICT REGULATORY AND POLICY FRAMEWORK Most key policy, laws and regulations are in place Uganda Communications Act of 1997 National ICT Policy, 2003 Various supporting Regulations, 2005

Lack of data protection and e-commerce laws, although bills have been drafted Liberalized telecommunications market Generic telecommunications licensing framework that is flexible & technology neutral

Trade in Information and Communication Services: Uganda Case Study

BUSINESS ENVIRONMENT Electricity Taxes % of firms identifying problem as main obstacle 64 Foreign investment Uganda Africa Governance 37 “Doing Business” 11

Electricity

Tax rates

Anticompetitive / informal practices

15 7 Access to finance

Transport

Corruption

Source: World Bank, Enterprise Surveys: Uganda, 2006

Business permits

Trade in Information and Communication Services: Uganda Case Study

Electricity Electricity a “Major” or “Severe” Obstacle

Days to Obtain an Electrical Connection

Owns or Shares a Generator

Electricity from Generator

Rwanda (2006)

32%

58%

30%

Ethiopia (2002)

42%

116

17%

Uganda (2003)

43%

36%

Kenya (2003)

47%

71%

15%

Tanzania (2003)

58%

Source: The World Bank Enterprise Surveys.

www.enterprisesurveys.org

55%

12%

Trade in Information and Communication Services: Uganda Case Study

Taxes Uganda has eliminated virtually all ICT equipment import duties (remaining duties basically on wired telecom equipment). Uganda’s import duties less than East African Community Customs Union in most cases. Excise taxes on communications services are a barrier to greater use and have a detrimental impact on the economy. Uganda has highest mobile excise tax in East Africa and also charges excise on fixed calls. Uganda’s VAT (18%) is between Kenya (16%) and Tanzania (20%).

Import duties, 2006 Uganda

EACCU

Computers

Computer parts

10%

Mobile handsets

25%

Wireline equipment

10%

Trade in Information and Communication Services: Uganda Case Study

Foreign investment Favorable foreign investment scheme 100% foreign investment possible Incentives and support from Uganda Investment Authority

Trade in Information and Communication Services: Uganda Case Study

Governance Rule of Law

Control of Corruption

0 -1 -2 -3 -4 -5

Ethiopia

Kenya

Rwanda

Sudan

Tanzania

Uganda

Ibrahim Index of African Governance rank

Source: World Bank, Worldwide Governance Indicators info.worldbank.org/governance/wgi2007

Political Stability

Trade in Information and Communication Services: Uganda Case Study

Doing Business Enforcing Contracts

Trading Across Borders

Protecting Investors

Registering Property

Employing Workers

Dealing with Licenses

Rank

Starting a Business

Economy Kenya

111

115

145

Ethiopia

146

118

149

Uganda

107

110

166

160

157

Source: World Bank, “Doing Business” (2006) 142 127 172 143 Tanzania www.doingbusiness.org

Sudan

154

164

142

165

158

Rwanda

158

133

106

134

162

175

Trade in Information and Communication Services: Uganda Case Study

UNDP Education Index 2006 0.61

0.62

0.67

0.69

0.53

“Uganda’s cheap, trainable and English-speaking workforce can be turned into a cadre of skilled ICT technocrats to provide the necessary human resources for ICT growth.”—UNCTAD, ICC “AN INVESTMENT GUIDE TO UGANDA”

0.40

Kenya

Uganda

Tanzania

Rwanda

Sudan

Ethiopia

% of firms identifying labor skill shortage as major constraint 2006

Based on weighted average of literacy and combined gross school enrolment ratio.

17%

10%

Uganda

Africa

Source: World Bank

Source: UNDP Human Development Report 2006 http://hdr.undp.org

Human resources – Education / Skills

Trade in Information and Communication Services: Uganda Case Study

Human resources - Language skills

Ethiopia

Rwanda

Uganda

205

229

Kenya

203

227 210

Tanzania

Sudan

195

Source: Educational Testing Service (ETS) www.ets.org/toefl

“From an ICT services perspective…certain skills are a necessary condition to compete in the services outsourcing business… Language skills are also often mentioned as important in choosing locations…TOEFL test scores are often taken as an indicator of skills…” —OECD

TOEFL Average Score July 2005-June 2006

TOEFL=Test of English as a Foreign Language

Trade in Information and Communication Services: Uganda Case Study

$2,729

$1,037

Source: IMF.

Tanzania

Sudan

$334

Uganda

Rwanda

Ethiopia

Sudan

Africa

Uganda

Rwanda

Note: PPP = Purchasing Power Parity.

$260

$316

Kenya

$681

$1,626

$1,406

$1,341

$1,044 Ethiopia

GDP per capita, US$,2006

$177 Kenya

$801 Tanzania

GDP per capita, PPP, International US$, 2006

$2,686

Human resources – Costs

Trade in Information and Communication Services: Uganda Case Study

Business Process Outsourcing (BPO) Trade in commercial services, 2004 Total = US$ 2,211 billion US$ 1,061 billion Computer & Information Services Construction (2%) (2%) Insurance (2%) US$ 42 billion Financial (6%)

Communications (2%)

Travel 29%

Transport 23%

Other 48% "ICTenabled services"

Source: WTO.

Royalties (7%) Personal, cultural & recreational (1%) Other business services 24%

Trade in Information and Communication Services: Uganda Case Study

BPO in action India BPO export market 415

316

$6.3

$4.6

553 $8.4

163 101 $1.5

FY05 FY06 Exports (US$ billion)

Source: NASSCOM

FY07 Staff (000s)

Accumulated FDI in Mauritius BPO market, US$ million $50

$30

$33

Jan-06

Sep-06

Source: BOI

Philippines BPO export market

2004 2005 Exports (US$ billion)

$3.5

2006 Staff (000s)

Source: BPA/P.

South Africa call center agents

6,500 Mar-07

$2.4

237

2003

8,141

2004

Source: CallingtheCape

11,312

2005

Trade in Information and Communication Services: Uganda Case Study

Uganda BPO policy & actions “Facilitate the establishment of Internet-ready Industrial Parks to engage in Data Capture and Data Processing export work.” —National ICT Policy 2002 “The creation of a policy and regulatory environment that supports Uganda’s aspiration of being a telecommunications and IT services hub.” —Telecom Sector Policy Review 2005 Uganda Investment Authority profiles on call centers, data centers and etranslation

BPO Group within Ministry of ICT ICT Park Presidential Committee ICT Outsourcing Services Association

Trade in Information and Communication Services: Uganda Case Study

BPO destinations

Trade in Information and Communication Services: Uganda Case Study

BPO ranking Human Resources

UNDP Education Index TOEFL GDP per capita

ICT Infrastructure

International bandwidth Broadband costs Fixed lines

ICT Laws

WTO BTA WIPO WCT UNICTRAL

Business Environment Doing Business Rank Governance Rank Electricity

Mauritius Philippines S. Africa India Ghana Kenya Uganda Sudan Tanzania Ethiopia Rwanda 0 Human Resources ICT Laws

0.25

0.5

0.75

ICT Infrastructure Business Environment

Trade in Information and Communication Services: Uganda Case Study

Uganda BPO SWOT STRENGTHS

WEAKNESSES

 English official language  Competitive telecommunications regime (and experience)  WTO member, commitments under GATS and signed on to Reference Paper  Liberal foreign investment regime  Some experience with BPO  Ranks high in some business indicators such as hiring staff  Annual university output

 International bandwidth  Electricity  Relatively high telecom prices  No WTO ITA or CRS commitments; lacking laws relating to e-commerce, data privacy, etc.  External image. Ranks low in some governance indicators & not widely known as BPO location  Lack of visible single industry association

OPPORTUNITIES

THREATS

 Links to India, largest developing country BPO location  Planned fiber optic initiatives  Leverage Makerere University ICT programs for training and industry links  Variety of outsourcing activities

 Landlocked  Competition from other developing countries  Backlash against offshoring in developed countries

Trade in Information and Communication Services: Uganda Case Study

Benefits of WTO Commitments in ICT Transparency and predictability Support for domestic reform efforts Attract foreign investment Market opening for exports

Trade in Information and Communication Services: Uganda Case Study

WTO and ICT General Agreement on Trade in Services (GATS) Covers services only

• Telecommunications • Computer & Related Services (CRS)

Information Technology Agreement (ITA) Addresses tariffs on goods considered essential to ICT sector

General Agreement on Trade and Tariffs (GATT)

Governs import of products through tariff schedules

Uganda Status WTO member since 1995 Scheduled commitments for communications services under GATS Expanded telecom commitments in 1999 (post1997 after Basic Telecommunications Agreement concluded) and signed on to Telecommunications Reference Paper No CRS commitment Not party to ITA

Trade in Information and Communication Services: Uganda Case Study

Structure of GATS GATS is an integral part of the WTO Agreement, consisting of a number of articles in its main body and several annexes, including an Annex on Telecommunications General Obligations: Main body of the GATS and the Annex on Telecommunications are applicable to every WTO Member. Specific Commitments: Each WTO Member has attached its own schedule to the GATS, through which it makes individual specific commitments on market access, national treatment, and any additional commitments the Member wishes to undertake. Basic Telecommunications Agreement (BTA): Special GATS negotiations intended to deepen and expand commitments in basic telecommunications concluded in 1997, referred to as the BTA. Members participating in these negotiations made commitments, or further commitments, in their schedules on market access or national treatment. Many also made additional commitments in the form of a "Reference Paper", which contained a set of regulatory principles applicable to the telecommunications sector.

Trade in Information and Communication Services: Uganda Case Study

Supply modes

Specific commitments are inscribed by service sector and mode of supply of the service, and may be subject to limitations on market access and national treatment.

WTO GATS Classification

Description

Example

Mode 1 Cross-border supply

Services flows from the territory of one An American consumer making Member into the territory of another a phone call to Uganda Member

Mode 2 Consumption abroad

Situation where a consumer moves into another Member's territory to obtain a service

A Ugandan mobile subscriber roaming in Kenya

Mode 3 Commercial presence

Service supplier of one Member establishes a commercial presence, in another Member's territory to provide a service

UK company opens an office in Kenya to provide data processing for its European operations

Mode 4 Presence of natural persons

Persons of one Member entering the territory of another Member to supply a service

Uganda IT consultant temporarily employed by company in USA

Trade in Information and Communication Services: Uganda Case Study

Telecommunications Services Annex on Telecommunications General obligation imposed on all WTO Members to ensure that all service suppliers seeking to take advantage of scheduled commitments are accorded access to and use of public basic telecommunications, both networks and services, on reasonable and non-discriminatory basis. Specific commitments made by WTO Members for telecommunications services which are attached as national schedules, and made a part of the GATS. Telecommunications Reference Paper – additional commitment made by WTO Members through their schedule. WTO Members can include the Reference Paper in whole (e.g., Uganda) or in part (e.g., India) as part of their commitment. The Paper set forth six regulatory principles: i) competitive safeguards; ii) interconnection; iii) universal service; iv) public availability of licensing criteria; v) independent regulators; and vi) allocation and use of scarce resources.

Trade in Information and Communication Services: Uganda Case Study

Computer & Related Services (CRS) 1. BUSINESS SERVICES Computer & Related Services

a. Consultancy services related to the installation of computer hardware (841) b. Software implementation services (842) c. Data processing services (843) d. Data base services (844) e. Other (845 and 849)

20 of top 25 BPO jurisdictions have made commitments in their Schedules for CRS

Top 25 BPO Jurisdictions Rank

Country

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

India China Malaysia Thailand Brazil Indonesia Chile Philippines Bulgaria Mexico Singapore Slovakia Egypt Jordan Estonia Czech Republic Latvia Poland Vietnam United Arab Emirates United States Uruguay Argentina Hungary Mauritius

Source A.T. Kearny; WTO

CRS commitment     

              

Trade in Information and Communication Services: Uganda Case Study

Information Technology Agreement (ITA) Plurilateral initiative among WTO Members and acceding states (each Member must specifically sign on) Requires Members that have signed on to the ITA to eliminate tariffs on IT products listed in the Attachment to the Ministerial Declaration on Trade in Information Technology Products and to bind their tariffs for these products at zero. Applied on the principle of “Most Favoured Nation” and therefore all WTO members benefit from the Member’s commitment.

Certain ITA products listed in Attachment to the Declaration Computers Telecommunications Semiconductors Semiconductor manufacturing equipment Software Scientific Instruments

Trade in Information and Communication Services: Uganda Case Study Top 25 BPO Jurisdictions

ITA facts Initially, 29 Members signed on at the Singapore Ministerial Conference (December 1996) The number of participants has grown to 70, representing about 97% of world trade in ICT products 18 of top 25 BPO jurisdictions have signed on to ITA

Rank

Country

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Source A.T. Kearny; WTO

Member of the ITA               



 

Trade in Information and Communication Services: Uganda Case Study

Uganda’s current GATS commitments for telecommunications services Specific commitments for telecommunications services Market access commitments • No limitations on measures affecting consumption abroad of telecommunications services • Some limitations on national treatment, measures affecting cross-border supply, consumption abroad, and commercial presence for supply of telecommunications services • Measures affecting presence of natural persons are unbound No Most Favored Nation (MFN) exemption under Art. II of GATS Specific limitations • Commitments provide for duopoly in public voice and data services and private voice network services to third parties • All international services must be provided through duopoly license holders • Resale of excess capacity not permitted • Limit of three mobile providers (one being UTL) • Video and audio broadcast services excluded from scope of telecom services Signed on to Telecommunications Reference Paper

Trade in Information and Communication Services: Uganda Case Study

Uganda GATS and Reference Paper recommendations Generally, compliance with GATS Recommendations to update Uganda’s commitments to the Ugandan reality Issues in which Uganda’s legal reforms are not reflected in current commitments

Recommendations to enhance ICT marketplace by adopting “full commitments” for telecommunications services under GATS Issues to expand compliance under GATS

Recommendations to ensure compliance with current GATS general obligations and Reference Paper

Trade in Information and Communication Services: Uganda Case Study

Recommendation to update Uganda’s schedule of commitments to the Ugandan reality Uganda schedule of commitments on market access and national treatment for telecommunications services

Recommended modifications to schedule

Schedule of commitments provide for a duopoly in public voice and data services and private voice network services to third parties. International services must be provided through the duopoly license holders and resale of excess capacity is not permitted.

Uganda no longer needs this carve-out since it has a competitive market and no restriction on resale exists.

Schedule of commitments provide for a maximum of three mobile operators, one being UTL.

Uganda no longer needs this limitation since there are more than three mobile operators that have been licensed to provide services in the country.

Trade in Information and Communication Services: Uganda Case Study

Recommendations to enhance Ugandan ICT market by adopting “full commitments” for telecommunications services under GATS Uganda schedule of commitments on market access and national treatment for telecommunications services

Recommended modifications to schedule

Uganda law imposes higher registration fees for foreign companies and higher minimum investment requirements in practice although not legal requirement -- US$100,000 for foreign investors and US$50,000 for local investors.

Provide same treatment for local and foreign investors.

Uganda’s schedule of commitments excludes “video and audio broadcast services”.

Eliminate the exclusion of “video and audio broadcast services” in schedule to provide a level playing field for operators that seek to provide combined offering of voice, video, and data services (e.g., triple play offerings).

The schedule states that for satellite based services access is limited to what is provided under the MoU on Global Mobile Personal Communications Satellite.

Eliminate limitation on access given that the MoU only relates to importation and use of global mobile phones and not the provision of the service.

Trade in Information and Communication Services: Uganda Case Study

Recommendations to ensure compliance with GATS General Obligations for telecommunication services and Reference Paper Ugandan regulatory framework

Recommended modifications

The Licensing Regulations require every licensee to make tariffs publicly available, but does not clearly require that all terms and conditions for connection to the network or the specifications of technical interfaces be publicly available.

Pursuant to Section 5 of Annex on Telecommunications, ensure that provisions are included requiring public network operators to make leased lines available and on reasonable terms and conditions and information on technical interfaces is publicly available.

The 1997 Act provides for establishment of a Communications Tribunal but that has yet to be established.

Establish a tribunal to comply with Article VI of GATS requiring Members to maintain judicial, arbitral or administrative tribunals and procedures for prompt review of administrative decisions.

Trade in Information and Communication Services: Uganda Case Study

CRS recommendations Make commitments to cover all types of computer services. Uganda should make its commitments at the overall two digit computer services sector level (based on the two-digit WTO Secretariat’s Services Sectoral Classification and Central Product Classification (CNC) number of 84) so that all forms of computer services are covered by its commitments. Currently, confusion arises because many ICT/BPO activities could potentially fall under more than one of the subcategories listed under CRS.

Trade in Information and Communication Services: Uganda Case Study

ITA recommendation Uganda should join the ITA and commit to reducing its tariffs for ITA products to zero; this can be done over a period of time. A number of Uganda’s tariffs of ICT products are already at zero (e.g., no import duty in Uganda on mobile phones or computers). Eliminating tariffs and thereby reducing costs on IT products will: benefit various ICT industries: data processing, computer assembly, and telecommunications services, particularly mobile services industry. enhance productivity and improve economic efficiency in industry Likely result in expanded ICT usage benefiting consumer, industry and economy. These benefits will outweigh the costs of potential short-term loss in customs duties collected, and potential adverse competitive effects on inefficient domestic producers of information technology products. In binding its duties at zero, Uganda would be providing a signal to foreign and domestic investors of its commitment to maintain this policy in the future.

Trade in Information and Communication Services: Uganda Case Study

Conclusions and Recommendations Connectivity is key strategic issue and Uganda should ensure that it has other avenues for bandwidth than simply relying on Kenya While connectivity is a serious issue and resolution of this is fundamental, it will not resolve all issues and automatically make Uganda a tier one BPO jurisdiction Competition is fierce among the countries vying for ICT-enabled services, and a number of countries have mature markets for these services; as such, Uganda should seek to enhance its attractiveness as a BPO jurisdiction as much as possible in order to differentiate it from its competitors (e.g., updating and enhancing its WTO commitments, enacting ICT laws, maximizing potential incentives for BPO companies) Uganda should support the development of a BPO industry association, such as NASCOM in India Given that resources are limited, within the government, ICT-enabled service activities should be coordinated among the different agencies to ensure that initiatives do not overlap and are properly coordinated As found in many BPO jurisdictions, it is better to focus on certain niche BPO specialties and then evolve to more enhanced activities rather than try to compete for all types of BPO services

Trade in Information and Communication Services: Uganda Case Study

Thank you. Janet Hernandez janet@tmgtelecom.com Michael Minges minges@tmgtelecom.com Tel. 01-703-224-1501 Fax 01-703-224-1544 www.tmgtelecom.com