Privatization and Regulatory Reform in the Middle East and North Africa Area

Agence Française de Développement

Working Paper

June 2008

67

Privatisation and Regulatory Reform in the Middle East and North Africa (MEDA) Area - Telecom Case Study

Mihoub Mezouaghi, AFD (mezouaghim@afd.fr)

Département de la Recherche

Agence Française de Développement 5 rue Roland Barthes 75012 Paris - France Direction de la Stratégie www.afd.fr Département de la Recherche

This paper has been written in the framework of a research programme Understanding Privatisation Policy: Political Economy and Welfare Effects (2006-2007) coordinated by FEEM (and supported by European Commission within the sixth framework Programme for Research and Technological Development - FP6, Citizen and governance in a Knowledge-based society).

Disclaimer The analysis and conclusions of this document are those of the authors. They do not necessarily reflect the official position of the AFD or its partner institutions.

Publications Director: Jean-Michel SEVERINO Editorial Director: Robert PECCOUD ISSN: 1954 -3131

CopyrightDeposit: 2nd quarter, 2008

Keyboarding/layout: Anne-Elizabeth COLOMBIER

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Contents

Introduction

4

1.

Telecommunication services in MENA countries: facing the regulation challenge

5

1.2

Telecommunication reform in MENA countries

7

1.2.2

A similar reform leads to differentiated performances

10

Regulation patterns: convergence vs. divergence

13

Market structure

15

1.1

1.2.1 2.

Opening the telecommunication market to competition: some theoretical evidences

Towards a convergent regulatory framework

2.1

Regulatory framework

2.3

Privatization of the incumbent

2.2

2.4

5 7

13

17

Diversity of the liberalization trajectories

18

Annex

21

References

23

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Introduction

During the nineties, the globalization of telecommunications

the new institutional framework, compared to those that

of public monopolies, leading to international competition

(iii) to analyse how the new framework has changed the

These economic dynamics have been fostering regulatory

differences in performance may relate to the specificity

imposed a model of development based on the suppression

maintained administrative regulation);

and the privatization of public telecommunication operators.

market dynamics (competition and regulation) and how

and institutional adjustments whose objective is to guaran-

of the reform policy; such analysis is based on docu-

tee a stable and transparent environment for investors and

menting the liberalization process, especially how the

consumers. Such adjustments must also establish stan-

reform sequences determined the behaviour of public

dards that enable connections between networks and pro-

and private actors. Indeed, institutional failures (anti-

mote a satisfactory quality-to-price ratio. More globally,

competitive practices, market opacity, etc.) are still ham-

redefinition of the regulatory and legal framework indicates

pering access to telecommunication services in most of

a transition towards a new regulatory paradigm based on

the countries.

full market competition, impartiality of the public authorities,

(iv) to highlight policy implications by exploring the role of

equity and transparency.

an (independent) regulatory agency and its effective design in the context of a political economy in which

Telecommunication reform has been introduced in the

public power is still heavily centralized. Specific interac-

Middle East and North Africa countries since the mid-nine-

tions between the regulator, public authorities and regu-

ties, with the adoption of new legal rules (code of telecom-

lated or non-regulated firms reveal a diversity of trajec-

munications). In accordance with the reform requirements,

tories for liberalization.

governments implemented institutional and industrial

restructuring, fostering the entry of new actors into

Our methodological approach is mainly based on the new

services markets. Most governments have been slowly

lyze how institutional complementarities affect public and

(mobile/fixed) telephony, data transmission and Internet

institutional economics literature. Our purpose is to ana-

introducing competition and privatizing state-owned firms.

private actors’ decisions and interactions, and how they could explain the coexistence of several models of libera-

But a comparative analysis shows significant differences

lization.

among liberalization policies in the region. The main objectives of this paper are:

In MENA countries, we can distinguish between two kinds

(i) to present the institutional orientation of the reforms in

based on breaking up public monopolies and creating an

of regulatory patterns. On the one side, the framework is

MENA countries, highlighting the main sequence of

independent and autonomous regulatory body in charge of

events of the liberalization process and the regulatory

opening up the telecommunication market to competition

framework specifics; these reforms are part of a com-

and sanctioning anti-competitive behaviours. On the other

plex transition - from administrative regulation to neo-

side, the framework is based on interventionist governance

liberal regulation - in the field of telecommunications;

and strong regulation, under which the public operators

(ii) to present main trends in the telecommunication market

maintain a dominant position. In reality, between these two

(the emergence of new private/public actors, and the

regulatory patterns there exist hybrid configurations that

performance of countries since the implementation of

characterize the liberalization process.

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1.

Telecommunication services in MENA countries: facing the regulation challenge 1.1

Opening the telecommunication market to competition: some theoretical evidences

Growth of the global telecommunications markets is widely

Kikeri, Nellis, and Shirley, 1992; Ros, 1999). Among

competition. Since the eighties, and even more so since the

higher in the competitive markets of OECD countries

attributed to technological innovations and opening up to

these studies, some have shown that teledensity is

nineties, most of the countries have adopted telecom

(Boylaud and Nicoletti, 2000), in Central and Eastern

reform. The theoretical literature underscores the drivers of

Europe (Gruber, 2001) in Latin America and Asia

the institutional transition from administrative regulation to a

(Petrazzini and Clark, 1996; Wallsten, 2000) and in

liberal one. We present here five lessons derived from theo-

MENA countries (Rossoto, Sekkat and Varoudakis,

retical (and empirical) evidences:

2003). In the case of mobile phones, teledensity increases were based on the entry of new operators,

Investment in telecom fosters growth: the endogenous

the size of the fixed telecommunications network and

growth theory highlights the impact of infrastructure

the demand potential (consumer income) (Fuss, Meschi

capital on economic growth, creating a link between

and Waverman, 2005).

public and private investment and network externalities,

and thus serving as an argument for rethinking the role

of public policy (Barro and Sala-i-Martin, 1995). The

Verboven (2000) note that open entry that is simulta-

infrastructure is derived from reducing production costs,

neous with competition is more effective in accelerating

providing better services for consumers, attracting

teledensity than sequential entry. In fact, the teledensity

investors and thereby ensuring future economic deve-

gains can be lower if privatization is introduced before

lopment (Röller and Waverman, 2001).

competition (when the government seeks to increase

Regulation based on monopolies has failed: as has

the value of the incumbent’s capital). Moreover, a long

been highlighted in several papers, the poor performan-

exclusivity period can decrease network growth by set-

ce of state-owned telecom firms is evidenced by conver-

ting entry barriers (most of the time in order to preserve

gent indicators: low productivity (capital and labour); low

the incumbent against pressing competition). In addi-

quality of connection; relatively high prices; long waiting

tion, privatization alone is not correlated with improve-

periods for telephone connections; and insufficient tech-

ments in the telecommunication sector, but it is correla-

nological change (Laffont and Tirole, 2000; OCDE,

ted when regulatory capacities are built up beforehand

2002).

opening up to competition result in different performan-

ce levels. In the case of mobile telephony, Gruber and

growth dividend from investment in telecommunications

The sequence of reform matters: varying approaches to

(Wallsten, 2000, 2002).

Telecom reform has produced positive effects: studies

exploring the impact of telecom reform on performance (competition, privatization and regulation) found positive

Telecom reform is a complex process: it takes time for the building up of regulatory and administrative capaci-

ties to achieve results, because the process implies

effects, in both developed countries and developing

more than putting in place regulatory laws. In fact, insti-

countries, by comparing the performance of competitive

tutional complementarities can play a role in the imple-

and non-competitive markets (Wellenius et al. 1992;

mentation of a new regime based on competition rules

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1. Telecommunication services in MENA countries: facing the regulation challenge

(Amable, 2000; Bauer, 2005). The opening to competi-

As discussed above, telecommunication reform leads to an

tions operators and the establishment of pro-competiti-

more generally on the political and socio-economic context.

tion, the privatization of state-owned telecommunica-

institutional transition that depends on public choices and

ve regulation are the three main dimensions of liberali-

From a synthetic point of view, there are two basic regula-

zation policy. Each dimension requires allocative effi-

tion paradigms. As shown in Table 1, the abstract, idealist

ciency in the market and public intervention. If competi-

regulation is based on full competition in the market (no

tion is introduced to free the market drivers, the number

barriers to market entry and exit) and implies only a minimal

of firms is fixed by policy. Most of the time, privatization

role for regulatory authorities. The sector performance is

concerns just a part of the incumbent’s capital; the forei-

driven by the market forces. So, this scenario supposes that

gn participation can be majority but rarely total. If auto-

the opening to competition must lead to the efficient alloca-

nomous regulators have been established, they are not

tion of resources, to stimulate technological innovation and

fully independent (Fink, Mattoo and Rathindran, 2002).

diffusion and to improve consumer satisfaction by reducing price and increasing quality.

Therefore, telecommunication liberalization contributes to improvements in networks by attempting to surmount the

The second scenario, strategic regulation, is based on an

approach is fundamental for three reasons: first, network

tion. Therefore, it supposes a reality-based analysis that

large technical, economic and institutional obstacles. This

oligopolistic market structure, implying a need for regula-

externalities in telecommunications (meaning that the more

seeks to focus on institutions and the way they define a

regulatory framework1. This paradigm does not deny that

people are connected to a network the more valuable it is)

the combined forces of technological innovation and com-

may brake the competition since each operator seeks to

petition will erode monopolistic control of the telecommuni-

limit the network access to competitors; second, the incum-

cation infrastructure and the services supply. But it

bent, which has to be restructured in order to pick up and

assumes that in reality, the behaviors of the market players

diffuse technological innovations, remains a key variable of

are not as obvious as is supposed in the idealist scenario.

an industrial policy (even if the public operator has been

For instance, network standards and the dominant position

partially privatized); and third, a competitive regime

of a few operators (most of time the incumbent, but in some

emerges from the non-partisan relationship between the

cases larger transnational corporations) make the public

regulator and the government on one side and from the

network more closed and inaccessible to users. Moreover,

impartial relationship between the regulator and the opera-

the prevalence of oligopolistic rivalry provides renewed

tors on the other side.

Table 1.

Two paradigms of telecom regulation

Full competition scenario) (Idealist)

The dominant player(s) scenario (Strategic)

Permeable seamless networks

Fragmented networks

Demand-led telecommunication industry

Supply-led industry, multinational user pressure

Universal services

Reduced universality of services

Open Systems, common interface standards

Weak stimuli for competition

Co-operative partnerships, transparent network access

Rivalry, non-transparent network access

Minimal regulation

Increasing regulation

Source: Mansell, 1993.

It assumes that “institutions are characterized by indeterminate, unstable oligopoly wherein the transnational corporations deliberately employ short-run pricing strategies to achieve longrun entrenchment and monopoly power in national markets, foreign and domestic” (Mansell, 1993, p. 6).

1

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1. Telecommunication services in MENA countries: facing the regulation challenge

incentives for using technologies and technological innova-

restricting network access for the entrants. These market

tions but weak incentives for competition (Mansell, 1993).

dynamics in the network industry provide strong evidence

of the need for institutional regulation in a converging mar-

In fact, most developed countries and some emerging coun-

ket to maximize competitive opportunities and to prevent

tries have adopted full competition, especially for voice com-

anti-competitive behaviors. By introducing new rules, com-

munications. Most developing countries, where reform is

petition law is supposed to avoid mergers and to prevent

more recent, are characterized rather by partial competition.

the conclusion of tacit agreements between operators, as

But in either case, in different ways, the liberalization pro-

well as misuses due to a dominant position in the market.

cess refers to the strategic regulation paradigm. Indeed,

Therefore, institutional arrangements determine the positi-

dominant operators develop strategies to preserve their

ve effects derived from the competition rules and define

market shares by limiting the entry of new competitors or by

1.2

specific regulation patterns.

Telecommunication reform in MENA countries

In context of the globalization of telecommunications and economic regionalization, MENA

countries2

for a long time (except Israel and Turkey) in spite of having

underwent a

huge unsatisfied demand.

deep institutional adjustment, introducing new regulatory

challenges. The adoption of competition law regimes can

In the context of the WTO agreement and the Association

Agreement on Trade in Services) and regional (Euro

MENA countries (in the framework of the Barcelona

be explained by their participation in international (General

Agreements signed between the European Union and the

Mediterranean Partnership) trade agreements, but the spe-

Process) to move towards a complete free-trade area, com-

cific circumstances and the impacts differ by country.

1.2.1 Towards framework

a

convergent

petition law was introduced or reinforced at that time. On that point, it is important not to consider all MENA countries

regulatory

as a homogeneous group. Imperfectly, we can distinguish three groups:

By the eighties and the beginning of the nineties, most MENA countries averaged less than 10 telephones per

(i) the first group is composed of Israel and Turkey, which

that time, all the MENA countries, dominated by a strong

authority in a convergent way with the European com-

100 people compared to about 60 in OECD countries. At

have adopted competition law and set up a competition

interventionism, had telecommunications monopolies: a

petition law regime;

state-owned operator and no separate regulatory authori-

(ii) the second group includes the Maghreb countries

tor, which in many cases fixed prices to cover govern-

tition laws are patterned on the French model, suppo-

ty outside of the ministry tasked with regulating the sec-

(Algeria, Morocco, and Tunisia), where national compe-

ment budget deficits. But discretionary price regulation

sedly close to the European requirements, but competi-

has implied operating costs that are higher than reve-

tion rules are weakly enforced (due to lack of expertise,

nues, reducing the possibilities to support network

failures of the judicial system, weakness of professional

upgrades and expansion.

and consumer associations, insufficient access to economic information and corruption);

The administrative regulation model based on monopoly has failed. This regulation model led to failures in most

countries (technological backwardness, low levels of investment, poor service quality, low productivity, an inap-

2 Namely Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, the Palestinian Authority, Syria, Tunisia and Turkey.

propriate tariff structure). MENA countries were backward

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1. Telecommunication services in MENA countries: facing the regulation challenge

(iii) the third group is countries that have just adopted competition legislation - as

Jordan3

after several attempts during the last decade - as well

in 2002 or Egypt, which

as countries in the process of adopting domestic com-

more recently submitted a law project to the Parliament

petition legislation (Lebanon and Syria).

Box 1. A polarized worldwide market Countries are involved in an inclusion (exclusion) process in the digital economy. Although countries are more and more linked, more and more dependent, economic and technological inequalities tend to increase deeply, defining the paradox of globalization. This implies a polarization of the ICT network and consequently a polarisation of the users. North America, Western Europe and Asian emerging countries repre-

sent two-thirds of the worlwide telecommunication services market. The emerging countries, which are catching up with the developed coun-

tries, are those that have developed their telecommunication networks and created an ICT industry (China, Malaysia, Brazil, Czech Republic, etc.).

World telecommunications services market by region (2001 and 2006*)

Source: data from IDATE (2005).

*Estimates.

In return, most developing countries represent secondary markets (despite high-growth potential), where lower consumer buying power may

constitute an obstacle to investment in new technologies. Indeed, due to a cumulative effect, international firms tend to invest more in highrevenue markets well-endowed with modern infrastructure and invest less in the others, causing spatial divides in the telecommunication networks (Rallet, 2000).

Since the mid-nineties, Jordan has made important and quick progress in liberalization, so it could be considered closer to Turkey and Israël. But contrary to these countries, Jordan has not yet developed a similar regulatory framework (capacity to enforce the competition rules).

3

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1. Telecommunication services in MENA countries: facing the regulation challenge

Since the end of the nineties, the telecommunications

necessary for a liberalized telecommunications market

sector has been a prime focus of reforms and privatiza-

has been put in place at the level of law.

tion. With the liberalization of the telecommunication sector, MENA countries have been facing a double chal-

Following a first stage that involves the separation of ope-

based on new institutions; organizing the State’s disen-

set up independent regulatory authorities. At the same time,

lenge: moving toward a new regulatory framework

rating and regulatory activities, MENA countries have next

gagement from production; and setting up mechanisms

a number of new regulatory tools have been introduced,

based on full competition, transparency and impartiality.

such as licensing, interconnection and dispute resolution mechanisms. By restructuring the incumbent operator, and

Mainly, three goals pushed countries to adopt a new ins-

in some cases privatising it, governments complete the libe-

titutional framework: opening the market to new entrants

ralization of the telecommunication market. This process is

to introduce competition between the firms; attracting

similar in the majority of developed and developing coun-

private and international investment to develop net-

tries.

works; and allowing for effective governance through

the creation of a regulatory agency (which has to attend

As seen in Table 2, Jordan and Morocco were the first

viours).

ge the institutional pattern, respectively in 1995 and 1997.

to free competition and sanction anti-competitive beha-

countries to enforce the liberalization scheme and to chanThus, the Moroccan authorities separated the regulatory

In recent years, most of the MENA countries have embra-

and industrial activities in 1984, by creating the Office

ced pro-competitive reforms and adopted telecommunica-

National des Postes et Telecommunications, a distinct

cations services, including voice telephony, infrastructure

tion services. The Ministry became responsible only for

tion law amendments regarding all forms of telecommuni-

public entity that took charge of supplying telecommunica-

and digital content. In short, the institutional framework Table 2.

Telecommunication law amendments

Algeria Egypt

Morocco Tunisia Libya

Israel

Jordan

Lebanon Syria

Turkey

West bank and Gaza

regulating the sector. In Jordan, a similar restructuring had

Separation of operation and regulatory functions

Telecommunications code amendments

1998

1998

2000

2000

1984

1997

1995

2001

-

-

1984

2003

*

*

1971

1995

-

-

1994

2000

-

-

*Under consideration.

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1. Telecommunication services in MENA countries: facing the regulation challenge

been introduced in 1971. That was followed by Egypt,

and Tunisia are relatively under-equipped,4 while Israel,

Libya, Syria and Palestine the Ministry still remains directly

regard to mobile-line density, countries such as Palestine,

Turkey, Algeria, Tunisia and Israel. On the other hand, in

Lebanon and Turkey are relatively over-equipped. With

responsible for the regulation of telecommunications.

Jordan, Syria, Egypt and Lebanon are relatively underequipped, while Israel, Turkey, Tunisia, Algeria and

In Lebanon, a reform project drafted back in 1999 planned

Morocco are relatively over-equipped (Figure 1).

to create an independent regulatory body responsible for

various regulatory issues of the telecommunications indus-

Secondly, fixed telephony penetration remains at a low

ging the existing state-owned, fixed-line company OGERO

phony infrastructure has resulted in a substitution effect5:

try and to restructure the state-owned operator after mer-

level in the region (except in Israel). Inadequate fixed tele-

with some ministry departments. This plan has only recent-

mobile subscribers increase strongly, while fixed subscri-

mented in 2007-2008.

Jordan, Turkey and Israel).

bers tend to stagnate or even to decrease (Morocco,

ly been adopted by the parliament and should be imple1.2.2 A similar reform leads to differentiated

Thirdly, performances become stronger as the liberaliza-

performances

tion process is implemented. The entry of a second operator has caused the market to take off. But perfor-

In spite of a convergent reform, national performances have

mances are also determined independently from tele-

tended towards divergence. Globally, if we compare MENA

communications reform. For instance, in 2005 Lebanon

countries first to their peers (Figure 1) and then to the EU

and Palestine attained a teledensity higher than that of

(Table 3), we can ascertain three observations:

Egypt, where the liberalization process is more advanced. Other factors can explain the results and the diffe-

Firstly, as far as fixed-line density is concerned, countries

rent trajectories.

such as Algeria, Jordan, Syria, Egypt, Palestine, Morocco Figure 1.

Telecommunication performances in MENA countries 2000-2005

Source: ITU data.

4

Compared to the worldwide average.

Nevertheless, growing demand for new services in fixed networks (voice over IP, Internet services) and convergence of mobile and fixed networks, as in more mature markets, should foster complementary using (instead of alternative using) (Melody, Sutherland, and Tadayoni, 2005).

5

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1. Telecommunication services in MENA countries: facing the regulation challenge

Table 3.

Mobile teledensity from 1998 to 2006: convergence to Europe

Algeria

Morocco Tunisia Egypt Libya

Jordan

Lebanon Syria

Gaza and West Bank Turkey Israel

Europe

1998

1999

2000

2001

2002

2003

2004

2005

2006

3,2

5,9

22,3

36,3

40,9

43,9

43,7

46,6

51,7

3,4

5,8

9,6

13,1

15,3

15,3

21,8

23,7

0,5

3,2 1,1

2,7

1,1

2,6 2,4

0,8

3,4 1,9

0,7

2,5

8,9

11,5

2,0

2,5

8,2

34,7 3,3

20,3

52,6 3,2

49,3

67,0 4,9

62,5

71,4 65,4

10,2

10,8

21,1

37,1

44,8

43,6

39,7

64,0

73,9

0,0

0,1

0,5

2,7

4,6

4,2

18,0

18,3

23,8

119,6

86,2

61,7

50,8

44,4

41,0

35,0

32,8

30,4

26,1

16,8

15,3

20,2

18,1

24,0

37,0

32,7

21,9

271,0

209,9

191,6

201,3

186,6

172,3

146,5

133,9

122,0

41,4

100

56,1

100

67,5

100

63,4

65,6

100

100

Adoption of the telecommunication law

73,7

100

67,1

100

70,6

100

70,6

100

Base 100: Europe

Second operator (commercial starting) Third operator (commercial starting)

Fourth operator (commercial starting) Source: ITU data; author’s calculation.

If the convergence/divergence from EU is mainly explained

by market structure and regulation framework (as we will

see later), the divergence between MENA countries can be

Morocco, the opening to competition took place in the best conditions because the separation of regulation

explained by several factors:

Timing of the restructuring: in Jordan, Israel and and operating activities was effective before the entry of

new operators into the market. Having created a public

Timing of the opening to competition: the earlier

firm early enough, the government took the time to intro-

reform has been adopted, the earlier the telecommuni-

duce organisational changes, to reorganize the incum-

cation market has grown. Much of Jordan’s and

bent operator and to prepare it for the privatization to

Morocco’s success in the mobile market can be attribu-

come. In Algeria, the speedy transition from a planned

ted to regulatory reform that started earlier than in other

economy to a market economy provoked a non-compe-

Mediterranean countries. However, this argument can

titive situation. In few months, the framework was adop-

be questioned. Indeed, many observers have noted that

ted and implemented but could not really be efficient.

Morocco liberalized at the best moment, when the tele-

The incumbent was still being managed as an adminis-

communication sector was benefiting from increased

trative organization and was not able to face competi-

values on the stock exchange (an operating license cost

tion. Orascom, the new entrant, was quickly in a quasi-

more than 1 billion dollars). This observation is perhaps

monopoly situation within the first two years of the ope-

correct in relation to some Mediterranean countries, but

ning to competition (Mezouaghi, 2005).

not really in relation to others like Tunisia, which sold the GSM license at the best price during the bursting of the

financial bubble ($45 per capita against $40 for

Price regulation: another kind of explanation is provi-

ded by market dynamics. For instance, in Morocco and

in Jordan access tarification had been reduced to a low

Morocco).

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1. Telecommunication services in MENA countries: facing the regulation challenge

level before the entry of the second operator, introdu-

when the new entrant is in a quasi-monopoly situation

cation. In Algeria, where the incumbent was not able to

market share in 2004, before the entry of a third opera-

cing competition more quickly into communication tarifi-

(in Algeria the new operator represented about 85% of

develop its network, the new entrant Orascom was in a

tor), when the government chooses the private operator

position to fix high access and communication tarifica-

on a personal basis, introducing conflicts of interest

tion. With the entry of the third operator in July 2004 and

(Syria, Lebanon, Libya), it is difficult to consider the

progressive restructuring of the incumbent, competition

competition regime satisfactory. On the contrary, in

became more effective. In Tunisia, the private operator

more structured and bigger markets, the operators’

had difficulties developing its network in the first stage,

positions are more well-balanced (Israel, Egypt, Turkey)6.

giving Tunisie Telecom a market advantage. The market in Tunisia remains controlled by the Ministry. Since tari-

fication had only two low (administered) cuts during the

These arguments suggest that the liberalization process

tarification.

countries can attain similar performance yet have different

only partly explains the divergence of performance. Indeed,

two first years, competition was effective only on access

levels of liberalization. Likewise, countries having a similar

Regulation of competition: MENA countries opening

liberalization configuration can have unequal perfor-

their markets to competition have often met (political)

mances. In fact, a more global explanation can be found

resistance. When the incumbent operator represents

through institutional complementarities that define regula-

about two-thirds of the market share (Tunisia, Morocco),

tion patterns.

6 See

annex.

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2.

2.1

Regulation patterns: convergence vs. divergence Regulatory framework

Effective regulation is important to ensure that market dri-

technological conditions; ii) organizing the interconnec-

vices and to deliver them to consumers at a lower price.

transparency and respect of the rules in order to create a

vers lead private and public actors to produce better ser-

tion networks between licensed operators; iii) promoting

International experiences show that one of the key ele-

more attractive investment environment; iv) protecting

ments of regulatory success is the existence of a separate regulator,

independent7

consumers against anti-competitive behaviours; v)

from the influence of the govern-

enhancing the quality of service and minimizing negative

ment and outside private-sector interests. Thus, a telecom-

health implications.

munication policy designed by the government has to be

implemented by a public authority, which must be financial-

As seen in Table 4, in MENA countries we can distinguish

institutional recomposition is important to promote impartia-

nal regulatory agency formally independent; and on the

ly autonomous and have sufficient sanctioning power. This

two groups: on one hand, the countries that created a natio-

lity and improve economic and financial efficiency (Estache,

other hand, the ones where the Ministry of Posts and

Goicoechea and Manacorda, 2006).

Telecommunications has remained responsible for telecom-

munication regulation (and even for services supply). In

More precisely, the role of the regulatory agency com-

Lebanon, Libya, Syria, West Bank and Gaza, there is no

prises specification, control and sanction functions espe-

independent regulatory authority.

cially by: i) delivering licenses (for infrastructure, trans-

mission, data and telephony services) to operators so

Globally, the creation of a regulatory body has helped to

that the services they supply conform to economic and Table 4.

increase transparency (invitation to tender, allocation of

Regulatory framework in MENA countries

MENA countries with an independent regulatory body Jordan

1995

Telecommunicationns Regulatory Commission (TRC)

Egypt

1998

National Telecommunication Regulatory Authority (NTRA)

Morocco Turkey

Algeria

1997 2000 2000

Agence Nationale de Réglementation des Télécommunications (ANRT) Telecommunicatiosn Authority

Autorité de régulation de la poste et des télécommunications (ARPT)

Tunisia 2001 Instance Nationale des Télécommunications (INT) MENA countries without an independent regulatory body Israel

Lebanon Libya Syria

West bank and Gaza

*

*

Ministry of Communications

Ministry of Telecommunications

General Directorate of Posts and Telecommunications Syrian Telecommunication Establishment (STE) Palestinian Autorithy

*under consideration.

According to a common definition, a regulator is considered independent when he or she has arm’s-length relationships with industry, consumers, private interests and politicians (Jamison, 2005). It is therefore difficult to evaluate the real independence of the regulator, despite a formal independence.

7

© AFD Working Paper N°67 • Privatisation and Regulatory Reform in the Middle East and North Africa (MEDA) Area ...

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2. Regulation patterns: convergence vs. divergence

Table 5.

Regulatory functions

Licensing

Interconnection rates

Numbering

Type approval

Price regulation

Monitor service quality

Source: ITU data (2005); author’s observations (2006).

licenses, publication of decisions, public consultations,

Technical standards

Radio frequency allocation

Quality of service

Spectrum monitoring and enforcement

Universal service standards

Mattoo and Rathindran, 2002), at the very least for four

market informations, etc.) and confidence from investors

reasons.

(Rossotto, Kerf and Rohlfs, 1999). So the establishment

of such institutions constitutes progress for countries

First, the mandate of the authority excludes, explicitly or not,

tionally centralized. However, the existence of a separate

Tunisia the government created two regulatory agencies - the

whose political and economic decision-making are tradi-

real sanctioning power towards operators. For instance, in

regulator, in and of itself, does not guarantee competition

INT (Instance Nationale des Télécommunications), in charge

and equity if this existence isn’t part of a legal framework

of telecommunication regulation, and the NAF (National

that gives the regulator authority and autonomy.

Agency for Frequency), in charge of spectrum management. But the Ministry of Communications Technologies

Regulators have faced serious difficulties, reflected in

kept major regulatory functions, such as licensing, dispute

limited autonomy in management and the use of finan-

settlements and the sanctions regime. Even when the sanc-

cial resources, as well as in limited capacity to regulate

tion power is assigned to the regulator, it is limited by a res-

and enforce decisions. In most cases, “authorities have

trictive situation. Moreover, absolute sanctioning power

acted more as administrators than regulators” (Fink,

(license suspension) is not really applicable, while a relati-

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14

2. Regulation patterns: convergence vs. divergence

ve one (penalties) is generally not attributed or politically

Third, while the regulatory framework is defined to be

controlled.

effective just inside national boundaries, any regional body (or coordinated policies between Mediterranean

Second, political pressures can hamper regulators’ actions,

countries) can play a role, for instance, on cross-border

reducing their effectiveness. In some cases, political inter-

mergers and cross-border competition issues ( as in the

ferences are clearly organized through supervision mecha-

European market).

nisms, when members are directly named by the governement or when government representatives are part of the

And last but not least, liberalization is a long process,

recruitment need to be approved by the government.

an “economic maturity”. The lack of experience has

board (Morocco, Egypt). In other cases, budgeting and

which requires learning effects, standardization and

Consequently, their neutrality and independence are not

been all the more problematic in countries that have

assured (Gentzoglanis, Sundberg and Schorr, 2001; Lewin,

had a centralized economy for a long time (Algeria,

Rossotto and Wellenius, 2004).

2.2

Egypt).

Market structure

On a global level, while basic services (fixed-line networks)

In liberalized markets, the situation is more uneven. The

countries, the mobile, data transmission and Internet ser-

ting for appreciating the heterogeneity of trajectories

remain characterized by a natural monopoly in most MENA

mobile market, the bigger in terms of revenues, is interes-

vices markets have been opened to competition (Table 6).

(Tables 3 and 6). Israel, and to a lesser extent Turkey, beca-

This opening is due to technological and economic rea-

me well-developed markets where sophisticated services

sons: introduction of new technologies and services; grow-

are provided and where teledensity is close to the

th potential; technological weakness of the public opera-

European level. The market structure is less concentrated.

tors; and the promotion of private investment (Crandall and

Four mobile operators are operating in Turkey, two started

Waverman, 2006).

to provide GSM services in 1994 (Turkcell and Telsim) and

the others in 2000 (Aycell, a Turk Telecom subsidiary and

The opening of fixed telephony seems to be a difficult step.

Aria, a consortium formed by Is Bankasi and Telecom

kets in 2002 and 2004, but the bid failed before succeeding

since 1994, Partner since 1998 and MIRS since 2001.

For instance, Morrocco and Algeria tried to open their mar-

Italia). In Israel, the mobile players are Bezeq, Cellcom

in 2006. Contrary to the mobile market, the growth potential

of the fixed market is weak. The network requires long-term

In other big markets, the market structure has not been as

obstacle to investment, and the long-term position of the

is a common point for Algeria and Egypt. The duopoly situa-

investment to get benefits, the small Internet market is an

efficient (the prices remained high or they increased). This

incumbent can block access to the network. Moreover, new

tion has not introduced a competitive regime. In Algeria, the

entrants (investors) express lower confidence in the regula-

structural weakness of the incumbent (Algerie Telecom) let

tion body’s ability to guarantee free competition (as the

the new entrant (Orascom) into a quasi-monopoly situation.

regulation is more complex and strategic concerning the

Competition has become effective since the end of 2004,

backbone infrastructure). Except for Turkey and Israel, it is

when a third operator (Al Watanya) entered the market and

important to note that the opening of basic services to com-

the incumbent underwent organisational restructuring. In

petition has failed (on an economic basis) or has been post-

Egypt, the mobile market is shared equally between two

poned (on a political basis).

operators (Mobilnil and Vodafone).

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2. Regulation patterns: convergence vs. divergence

Table 6.

Level of competition in the telecommunication market8 Local services

Domestic long distance

International long distance

Data

DSL

VSAT

Leased lines

Mobile

Mobile satellite

GMPCS

Internet services

Source: ITU data (2005); author’s observations (2006).

In Morocco and Tunisia, the mobile market has been essentially developed by the incumbent, which holds two-thirds of

In Palestine, Paltel, operating as a public shareholding, has

reinforced by asymetrical capacities and political support.

Authority (PNA), in place since 1997. Recently, a second

the market. The incumbent benefited from a strong position

acquired a 20-year license from the Palestinian National

New entrants (respectively, Meditel and Orascom) suffered

player has been chosen to develop the second GSM network9.

from financial difficulties and a fragile competitive position, especially during the first years of the liberalization process.

So, the way that reform has determined the market structu-

re is different for each country, creating a diversity of confi-

In Lebanon, two mobile telecommunication firms, France

gurations, explained by different institutional context and by

Telecom Mobile Liban and LibanCell, have operated under

different public choices. But, we can note one convergent

the framework of Build-Operate-Transfer (BOT) contracts

point: except for Egypt and Turkey, a single operator is in a

since 1994. Since that date, the Lebanese mobile market

dominant position and can take advantage of this situation

grew rapidly and became during the 1990s one of the most

(through predatory behaviour), especially by limiting access

dynamic markets among Mediterranean countries. The

to networks or increasing prices. The result could be a slow-

demand for mobile services reached a penetration rate of

down in network development and a setback to improve-

21% in 2000, from 3,6% in 1995, but was at only 27% in

ments in service quality10.

2005. This slowdown can be partly explained by the speci-

fic political situation, and more precisely by a break in the liberalization process.

In Syria, two private companies, InvestCom (Spacetel) and

SyriaTel were granted a license to operate the GSM net-

Such a table is relevant for countries where technological convergence is not in effect.

Globally in MENA countries, each market segment is characterized by specific actors and the telecommunication supply is weakly integrated. If market shares were available for all the countries and the opening to competition was more advanced, the Herfindahl-Hirshman Index could give a more precise measure of market concentration.

8

work. But in each case, the political proximity between the

operators’ owners and the State representatives has been an issue. The operators tend to share the market through

9 In 2007, a GSM license was allocated to a Kuwaiti company to operate the second mobilephone network. Al Wataniya acquired a 40% stake in the company and the Palestine Investment Fund 30%.

tacit agreement. In Lybia, the configuration is similar between the incumbent and the private operator (Madar).

10

See annex.

© AFD Working Paper N°67 • Privatisation and Regulatory Reform in the Middle East and North Africa (MEDA) Area ...

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2. Regulation patterns: convergence vs. divergence

2.3

Privatization of the incumbent

Privatization of the state-owned operator is considered a

conducting privatization, or a reverse sequence, do not

ciency and quality, introducing technical and production

vate vs. public ownership is important but not determi-

central operation. Such an operation aims to improve effi-

determine similar performances and behaviours. Also, pri-

nant11. Indeed, the incentives to improve services and redu-

standards, reducing public expenditures (subsidies), increa-

ce prices are weak in a monopoly situation (even in a duo-

sing budgetary revenues and tying into international net-

poly situation in big markets), regardless of whether the

works. Papers insist also on the positive impact of privatiza-

operator is state-owned or private (changing a public mono-

tion on sales, profits, investments and employment

poly to a private monopoly in developing countries has

(Megginson et al., 1994). However, privatization can be

often been anti-productive). In any case, operators are

considered outside the regulatory context (Bortolotti et al.,

stronger in a competitive environment.

2001). Indeed, privatization improved the financial and ope-

rating performance of incumbents in most countries (in particular, by cutting absolute costs: finance and labor costs),

In MENA, half of the countries have partially privatized the

cation sector had not been restructured before (when the

been different, depending on local political and economic

public operator. The path of the privatization process has

but its positive impact tends to be lower if the telecommuni-

conditions. Countries such as Morocco, Tunisia, Israel,

regulatory and operating fonctions have not been separated,

Turkey and Jordan have partially privatized the incumbent,

and so an independent regulatory agency does not exist).

while others such as Algeria, Egypt, Syria and Lebanon

intend to privatize the incumbent but have opted until now

Breaking up monopolies can be problematic if it is not com-

for upholding a public operator. Among the first group, all

bined with the institutional framework necessary for allo-

the countries achieved the separation of regulatory and

wing markets to function. In this context, the sequence of

operating functions before privatization.

reforms is important. Opening to competition before Table 7.

Status of the incumbent operator

MENA countries

Incumbent operators

status

Algeria

Algerie Telecom

State-owned

Lebanon

OGERO

State-owned

Egypt

Telecom Egypt

State-owned

Syria

Syria Telecommunications Establishment

Morocco

Ittisalat Al-Maghrib

Partially privatized

Israel

Bezeq

Partially privatized

Libya

Tunisia

General Post and Telecommunication Company

Tunisie Telecom

Jordan

Jordan Telecom

West bank and Gaza

Palcell

Turkey

State-owned State-owned

Partially privatized Partially privatized

Turk Telekom

Partially privatized Private

11 “The main lesson to be drawn is that the quality of regulation is a key determinant of performance, whether the utility is public or private. Compared to the quality of regulation, ownership seems relatively less important, though there may be more chance of high-quality regulation under private than public ownership” (Newbery, 1999, p.127).

© AFD Working Paper N°67 • Privatisation and Regulatory Reform in the Middle East and North Africa (MEDA) Area ...

17

2. Regulation patterns: convergence vs. divergence

As observed in other developing regions (South America

profits (Gentzoglanis, 2001).

regulatory capacity is built up much more slowly (Wellenius

Other countries postponed privatization indefinitely (Egypt,

relatively short amount of time in Morocco (a few months

steps towards privatization (Turkey13, Tunisia), essentially

and Asia), when countries quickly privatize the incumbent, et al., 1992). For instance, privatization was completed in a

Algeria), whereas some others were very slow to take bold

for three reasons. First, privatization is constrained by

after the allocation of a GSM license to the new entrant and its commercial

starting)12.

Indeed, privatization permitted

strong political and social resistance (especially when the

the increase in the incumbent’s value (given its monopoly

governement refuses to reduce employment or undergo a

rights in the fixed network and a strong position in the mobi-

loss of supervision). Second, privatization could fail becau-

le market), but it reinforced anti-competitive behaviors.

se of financial reasons (unfavorable stock market condi-

Whereas the regulatory body was in a learning phase, there

tions) or uncertainty in the investment environment. Third,

were weak incentives for the incumbent to allow access to

the government may be tempted to delay in order to obtain

its networks. This particular incumbent preferred to prevent

a higher sum of money from foreign investors (in that case,

competition in order to maintain its dominant position and

2.4

it depends often on the budgetary situation).

Diversity of the liberalization trajectories

Using the ITU regional database, complemented by our

highlighting some convergence and divergence factors of

own observations (based on several sets of variables), we

the liberalization process in the MENA area.

applied a multiple correspondence analysis to a sample of

Performance

30 countries (developed, emerging and developing coun-

tries, including MENA countries) in order to consider institu-

tional divergence and convergence.

Mainline penetration: defined by the number of telephone lines per 100 inhabitants that connect the subscribers’ terminal equipment to the Public Switched

Telephone Network (PSTN). This variable takes on the

Multiple correspondence analysis (MCA) uses a set of

value of 1 when teledensity is less than 25%; 2 when it

observations described by nominal variables to analyze

is between 25% and 50%; 3 when it is between 50%

the pattern of relationships between several categorical dependent variables. The relationships are characterized

by proximities between points in a low-dimensional map

(two or three dimensions) defined by a chi-square distan-

and 75%; and 4 when it is is more than 75%.

Cellular penetration: defined by the number of mobile

lines per 100 inhabitants that connect the subscribers to a mobile telephone service with access to the PSTN.

ce. When two points are close to each other, it could

This variable takes on the value of 1 when teledensity is

mean that the two observations present similar characte-

less than 25%; 2 when it is between 25% and 50%; 3

ristics.

when it is between 50% and 100%; and 4 when it is is

The method used seeks not to measure correlations between these qualitative variables but to underscore some

more than 100%.

Maroc Telecom was partially privatized when Vivendi Universal acquired 35% of the capital in 2000, and 16% in 2004. The government sold 15% of the capital via the stock exchange in 2004.

12

proximities between each category, thus characterizing the

In Turkey, the privatization of Turk Telekom started in 1994. In 2000, the government offered on tender a 20% block of Turk Telekom to international investors, but received no applications. In 2001, a law passed by the parliament included a plan for privatization and reinforced the operation mandate of the Telecommunications Authority. In 2005, a 55% share of Türk Telekom was acquired by Oger Telekom, a Saudi-Lebanese construction and telecommunications conglomerate, which also owns telecom assets in Saudi Arabia, Romania, Portugal, Jordan and South Africa.

variables. So, it requires a reduction in the number of

13

variables (by combining two or more variables into a single factor) in order to identify inter-related variables14. This

methodology could be useful in creating a link between per-

formance variables (teledensity) and institutional variables

14 There is no specification of either dependent variables, independent variables or causality.

Factor analysis assumes that all the rating data on different attributes can be reduced to a few important dimensions.

(market structure and regulation) and at the same time in

© AFD Working Paper N°67 • Privatisation and Regulatory Reform in the Middle East and North Africa (MEDA) Area ...

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2. Regulation patterns: convergence vs. divergence

Market size

the value of 1 if there is a regulatory agency, and 2

GDP per capita: this variable takes on the value of 1

when the country is low income; 2 when it is lower midd-

le income; 3 when it is upper middle income; and 4

sing is done by the government.

Mobile telephony market structure: this variable takes on the value of 1 when the market is full competition; 2

The proportions of explained inertia (variance) are accep-

poly.

thetized by the two-dimensional representations (Figures 2

when it is partial competition; and 3 when it is a mono-

table (close to 45% for the two factors). The results are syn-

Fixed telephony market structure: this variable takes on

and 3).

the value of 1 when the market is full competition; 2

when it is partial competition; and 3 when it is a mono-

Figure 2 shows clearly two opposite configurations. On the

poly.

one hand, the attributes of a pro-competitive regime (full competition markets and autonomous regulator) are asso-

Restructuring

ciated with high teledensity indicators; on the other hand,

Privatization of the incumbent: this variable takes on the

the attributes of a non- competitive regime (monopolies, no

value of 1 when the incumbent operator is totally priva-

regulatory body, and state-owned operator) are associated with low teledensity indicators15. These results corroborate

tized; 2 when it is partially privatized; and 3 when it is

the hypothesis that the success of the liberalization process

state-owned.

depends on the regulatory framework assuring transparen-

Regulation

takes on the value of 1 when the licensing is implemenregulatory agency and government; and 3 when licen-

Level of competition

Independence of the agency: Dichotomous variable that ted by the regulatory agency; 2 when it is done by the

when it is is high income.

otherwise.

cy, competition and the protection of public interests (and

Regulatory body: dichotomous variable that takes on

Figure 2.

consumers).

Liberalization process proximity

15 Of course, these two models are relative. This means that a pro-competitive model does not describe a perfectly competitive regime and competition mechanisms can exist in a noncompetitive model.

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2. Regulation patterns: convergence vs. divergence

Nevertheless, between these two models, there are hybrid

(ii) Second, despite high growth in the mobile market, the

instance, a duopoly situation (identified here as partial com-

and Internet services) has been held back by market fai-

configurations that adopt attributes from each model. For

telecommunication market (in particular core infrastructure

lures, especially that of high pricing16. Theses market fai-

petition) could be an efficient market structure, particularly

lures can be explained by institutional failures, such as the

in small countries. Also, a privatized (even partially) incum-

weakness of the regulatory body and the other competition-

bent is not clearly associated with good performance. This

focused bodies (the judicial system, consumers associa-

could be explained by the fact that privatization has not

tions, etc.). In that sense, since the market is not complete-

been systematically realized in a pro-competitive frame-

ly structured in some MENA countries, there is a risk that

work, or it had been realized before the creation of a regu-

liberalization efforts may not lead to a pro-competitive regi-

latory body.

me but for a time to a non-competitive regime characterized

Concerning MENA countries, we can underscore three les-

by markets dominated by opportunistic operators. In others

sons:

countries, the reduction of institutional obstructions could

foster an effective transition towards a pro-competitive regi-

(i) First, even if some countries have converged towards the

me.

European level (Israel, Turkey) or realized progress in liberalization (Maghreb, Jordan), they are still characterized by some

(iii) Third, the success of the opening process depends pri-

regulator (controlled by government supervision) or dominant

titutional framework, and in particular to give real power to

attributes closer to a non-competitive regime, such as a weak

marily on the public will and capacity to build a coherent ins-

position (anti-competitive behaviours, information asymmetry,

the regulatory agency. For instance, Israel and to a lower

market opacity). Due to the lack of human resources, political

extent Jordan and Morocco - considered liberal countries -

interferences, or insufficient sanction power, the regulators are

have been more interventionist than Libya, in the sense that

not yet in a position to provide sufficient pressure on the ope-

the liberalization of the telecommunication sector is part of

rators to respect the competition rules.

Figure 3.

an industrial strategy.

MENA countries and liberalization process proximity

Hybrid competitive regime

Non competitive regime

Pro-competitive regime

16 We did not use the collected information on prices because of heterogeneity and imperfect comparability. But globally, it clearly appears that prices remain high in most countries (except tarification access, and to a lower extent, communication tarification in the mobile market).

Š AFD Working Paper N°67 • Privatisation and Regulatory Reform in the Middle East and North Africa (MEDA) Area ...

20

Annex

Annex 1.a. Fixed teledensity from 1998 to 2006: convergence to Europe 1998

1999

2000

2001

Morocco

13,4

13,6

12,5

10,1

Egypt

17,3

19,4

21,7

25,7

Algeria

Tunisia Libya

Jordan

Lebanon Syria

Gaza and West Bank Turkey Israel

Europe

Base 100: Europe

13,3

21,5 24,2 22,3 51,9 25,3

13,7

23,2 25,9 29,8 51,9 25,6

14,6

15,1

25,0 27,1 30,6

9,3

2004

2005

2006

9,9

10,8

10,4

10,0

31,0

33,5

34,3

34,8

16,9

29,9

28,7

27,1

26,7

33,1

46,3

26,0

14,9

2003

27,0

31,9

44,0

2002

25,5

25,3 31,2 48,6 25,2

27,7 48,5 30,0

17,2

30,0 33,6 27,2 44,0 36,2

23,8

30,5 33,1 26,8 67,6 37,2

21,3

24,0

23,0

22,3

125,7

121,7

119,1

115,4

114,1

110,5

108,3

104,8

106,8

70,8

100

72,4

100

70,7

100

70,6

100

68,7

100

67,6

100

65,5

100

68,2

100

2002

2003

2004

Morocco

2,7

1,8

5,0

7,6

8,1

11,2

36,7

Egypt

3,0

4,5

16,6

17,5

21,7

35,1

33,5

5,4

13,8

33,9

44,3

Syria

Gaza and West Bank Turkey Israel

Europe

Base 100: Europe

40,4

21,1

2001

Lebanon

45,8

21,9

2000

Jordan

25,6

21,7

1999

Libya

35,4

17,7

1998

Tunisia

30,2

15,4

Annex 1.b. Internet penetration from 1998 to 2005: convergence to Europe Algeria

20,7

0,1

0,7

3,5

3,6

7,7

2,0

16,2

18,7

22,9

24,8

0,0

1,3

1,3

2,0

1,7

3,3

5,1

18,4

25,1

18,2

1,2

1,3

1,3

58,1 0,0

13,1

185,9 100

63,3 0,0

23,9

134,2

100

65,6

5,2

25,1 43,2 2,0

8,0

10,1

145,6

153,8

22,0

100

33,6

100

56,3 1,7

6,7

26,8

12,2

49,4

11,1

16,9

145,0

127,0

35,0

100

100

8,2

26,4

61,8

100

2005

17,3

43,3

28,1

20,0

11,4

10,7

53,0

58,1

13,6

146,3 100

33,3

17,1

19,5

64,8

138,3 100

Source: ITU data through 2006; author’s calculation.

© AFD Working Paper N°67 • Privatisation and Regulatory Reform in the Middle East and North Africa (MEDA) Area ...

21

Annex

Annex 2.

Results, multiple correspondence analysis

low fixed teledensity

medium fixed teledensity high fixed teledensity

very high fixed teledensity

P.Rel

Dist.

3.81

2.75

4.76 1.90 3.81

1

0.1

0.41

0.00

6.50

2.8

0.2

0.12

0.01

0.6

2.75

6.5

3.29

7.6

high mobile teledensity

2.38

5.00

0.9

very high mobile teledensity

4.76

Squared Cosines 1 2

7.0

3.33

3.81

2

2.00

low mobile teledensity

medium mobile teledensity

Contributions

2.75

2.00

6.4 10.3

0.03 0.34

0.18 0.29

5.2

0.38

0.14

2.9

0.04

0.07

1.2

15.6

6.7

8.0

0.06

0.39

0.44

0.25

incumbent totally privatized

3.81

2.75

0.2

0.5

0.01

0.01

incumbent state-owned

4.29

2.33

9.5

0.5

0.53

0.01

incumbent partially privatized

with regulatory agency

6.19

1.31

4.9

11.43

0.25

2.3

fixed market full competition

6.67

1.14

7.5

fixed market monopoly

3.81

without regulatory agency

fixed market partial comp.

2.86

3.81

4.00

9.1

2.75

0.0

0.34

0.00

0.3

0.44

0.04

6.2

0.55

0.24

2.9

0.68

0.08

1.4

2.75

0.0

12.8

25.0

0.44

0.00

0.04

0.70

mobile market full competition

6.67

1.14

4.9

0.1

0.36

0.01

mobile market monopoly

0.95

14.00

4.0

1.4

0.17

0.03

licensing by regulator

5.71

1.50

0.4

1.8

0.03

0.06

licensing by ministry

3.81

2.75

6.6

2.3

0.35

0.06

mobile market partial comp.

licensing partially by reg.

6.67

4.76

1.14

2.1

2.00

2.5

0.7

8.0

0.15

0.14

0.03

0.25

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22

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FUSS, M., MESCHI, M. and L. WAVERMAN (2005), “The Impact of Telecoms on Economic Growth in Developing Countries”, in

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GENTZOGLANIS, A. (2001), “Reforms and Optimal Regulatory Design in MENA Countries: Lessons from the Telecommunications Industry”, Journal of Development and Economic Policies, Vol. 4:1, December, pp.7-41.

GENTZOGLANIS A., N. SUNDBERG and S. SCHORR (2001), Une réglementation efficace. Etude de cas: le Maroc, Rapport de l’Union

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Réseau GEFOP (Synthèse rédigée par R. Walther) - Mars 2006.

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