Telecommunications breakthrough 68-nation pact: Global freedom of expression and exchange of information enhanced.

February 18, 1997

UNDER A TELECOMMUNICATIONS agreement signed over the weekend, this "global village" will be a far more talkative place. International telephone calls will drop in price by 80 percent. Faxes, data transmissions, satellite and radio communications will leapfrog national borders and open the world to less developed countries. Flabby state-run telephone monopolies will give way to open-market competition, with the United States very much in the lead.

Charlene Barshefsky, acting U.S. trade representative, does not exaggerate when she calls this pact, signed by 68 nations, "one of the most important trade agreements for the 21st century." It marks a breakthrough for the new World Trade Organization as a mechanism for sector-by-sector liberalization that bypasses the agonizingly long multi-sector negotiations of recent years. Next on the WTO agenda: Free trade accords in financial services and lower tariffs in information technology products. The battle against protectionism goes on apace.

While the technicalities in the telecom agreement are daunting, the potential effects for consumers worldwide are simple enough. Not only will someone in Tasmania be able to talk easily with someone with Tanzania, but he or she will be able to do so via U.S. global networks, bypassing the national systems where these two callers happen to be. And while the prospects of expanded business have left AT&T, MCI and Sprint gushing with enthusiasm, the new information highway will also allow Third World countries to tap sources of First World knowledge long out of reach.

For an industry already in the $600 billion-a-year category, this dramatic move to a freer market raises the prospect for a jump into the trillion-dollar class by the turn of the century. There will be fierce competition, with U.S. firms pressed hard by rivals in Europe and Japan. But this is precisely what encourages lower prices, better products, technological breakthrough and a stronger global economy.

It is unfortunate that Canada and Japan insisted on limits for foreign ownership in their telephone companies. But the U.S. has ample retaliatory leverage plus a charged-up momentum that can scarcely be resisted. As Ms. Barshefsky says, "U.S. companies. . . are in the best position to compete and win." While this country may encounter charges, some well merited, that its cultural domination is already excessive, it need not apologize for its role in a revolution that makes freedom of expression and access to information cheaper and easier for human beings everywhere.

Pub Date: 2/18/97

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