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PRESENTED BY: PROFESSOR DR. KHALED MOUSTAFA KASSEM PROFESSOR OF ECONOMICS AT ARAB ACADEMY FOR SCIENCE TECHNOLOGY AND MARITIME TRANSPORT-EGYPT DINA MOHAMED BAKR TEACHER ASSISTANT AT ARAB ACADEMY FOR SCIENCE TECHNOLOGY AND MARITIME TRANSPORT –EGYPT 1 The Liberalization of Egypt's Telecommunication Sector A Measurement of the Liberalization Index ( ) Rabat 20-22/12/2011 &

Importance of the Research 2 ”Information and communication technologies [ICTs] are, without doubt, enormously powerful tools for development. They create jobs,transform education, health care, commerce, politics and more. They can help in the delivery of humanitarian assistance and even contribute to peace and security. One of the most pressing challenges in the new century is to harness this extraordinary force, spread it throughout the world, and make its benefits accessible and meaningful for all humanity, in particular the poor” Kofi Annan Speech at the launch of the UN ICT Task Force November 2001 Rabat 20-22/12/2011 &

The Research Objectives The Research Methodology First : To assess the development in the telecommunication sector ‘s liberalization process over the period The Research Objectives and Methodology A "liberalization index", covering the period of , is constructed 3 Rabat 20-22/12/2011 &

The Research Hypothesis 4 There has been a tremendous progress in the liberalization Egypt's ICT sector during the period Rabat 20-22/12/2011 &

The liberalization of Egypt's Telecommunication Sector : A Measurement of the Liberalization Index( ) 5 Rabat 20-22/12/2011 &

The Measurement of Egypt’s Telecommunication Liberalization Index Degree of Effective Internal Competition Degree of Effective External Competition Degree of pro- competitive Regulation Egypt’s Telecommunication Sector Liberalization Index Identifying ICT’s Subsector’s Market Structure Focusing on the Openness of ICT Subsectors to FDI Focusing on the Presence of a Separate Regulatory body and Extent of its power in Handling Interconnection Issues 6 Rabat 20-22/12/2011 &

The Measurement of Egypt’s Telecommunication Liberalization Index Accordingly, The Liberalization index combines the following criteria: 1- The weighted average degree of competition in the fixed- line, mobile and internet markets. Competition indices range as follows: 0 for monopoly; 1 for partly competitive conditions; and 2 for full competition. 2- The weighted average degree of openness to foreign direct investment in fixed- line, mobile and internet markets (1 if investment is allowed in each case, o otherwise). 3-Presence of an independent regulatory body (1 if yes and 0 if no), and the extent of its powers in handling interconnection issues (1 if interconnection pricing is entrusted to the regulatory body, 0 otherwise). 7 Rabat 20-22/12/2011 &

The Measurement of Egypt’s Telecommunication Liberalization Index For a given year, the indicator of market liberalization is constructed by adding the country scores on each of those criteria. It ranges from 0 (least liberalization) to 5 (full liberalization). This indicator is likely to take one of the following scores (s): A. Restricted market liberalization: 0< s ≤ 1.25 B. Limited degree of market liberalization: 1.25< s ≤ 2.5. C. Moderate market liberalization: 2.5< s≤ D. Full market liberalization: 3.75< s ≤ 5. 8 Rabat 20-22/12/2011 &

The Measurement of Egypt’s Telecommunication Liberalization Index Then the telecommunication market Liberalization indicator will have the following ranking: 1=for restricted market Liberalization indicator. 2=for limited degree of market Liberalization indicator. 3=for moderate Liberalization indicator. 4=for Full market Liberalization indicator 9 Rabat 20-22/12/2011 &

Looking at the evolution of the telecommunication sector’s liberalization index in Egypt overtime as shown in the following figure, one can notice that Egypt has paved up the pace of telecommunication sector reform processes since 1990.Through the period from ; Egypt has achieved conditions of restricted ( ), limited ( ) then moderate market openness ( ). But despite this progress, telecommunication market in Egypt s remain, on average, less competitive with a potential for more liberalization. Progress of Telecommunication Liberalization Process in Egypt during the Period Rabat 20-22/12/2011 &

Liberalization of ICT Sector and its Possible impact on Industrial Sector Telecommunications play a key role among backbone services because they affect efficiency and growth across a wide range of user industries. The quality and price of telecommunication services directly affects business costs, besides, affects the capacity of firms to network and compete in foreign and domestic markets. Good quality and low cost of leased lines and backbone networks also facilitates internet penetration and the spread of IT applications in businesses that spur productive efficiency. 11 Rabat 20-22/12/2011 &

Conclusion and Recommendations 12 Rabat 20-22/12/2011 &

Conclusion and Recommendations Egypt’s telecommunication sector is performing consistently well with all sub-sectors being opened to competition. In sum, Evidence examined in that paper highlighted the major efforts undertook in the telecommunication sector’s liberalization process with more efforts needed towards inducing further deregulation. 13 Rabat 20-22/12/2011 &

Conclusion and Recommendations Thus, despite the progress experienced in the sector’s liberalization process, telecommunication market in Egypt remain, on average, less competitive with a potential for more liberalization. So it is highly recommended that: domestic reforms involving the market liberalization where the introduction of competition should be adopted, such as increased private participation and effective ICT regulation, in addition to international commitments to anchor domestic reforms. 14 Rabat 20-22/12/2011 &

Thank You 15 Rabat 20-22/12/2011 &