7 - Marketization of Telecommunications in Southeast Asia

Summary

Introduction

A process to re-equilibrate the balance between the public and private sectors is perceived as a new economic force which is changing economic behaviour and expectations on a global scale. Deregulation and privatization or marketization in short, to imply a return to the competitive conditions of the market, is widely pursued in as many countries as in the sectors affected. The terminology used, including other terms such as liberalization, divestment, divestiture, etc. arc, however, as diverse and varied as the mechanisms and means to achieve them. Much depends on the objectives and resource availability in the sectors or countries concerned. The consensus that privatization or marketization cannot be all things to all people or that “everybody is doing it — differently” (Economist, 21 December 1985), is a resounding one.

The literature on marketization and privatization is growing, and the impact and evidence of this trend in Southeast Asia is also well documented. Studies of deregulation in the telecommunication sector are prolific especially in the developed countries such as the United States, Canada, Japan, the European Community, Australia, New Zealand and others (see Snow and Jussawalla 1986 and References). Similar studies on privatization in the telecommunication sector in Southeast Asian countries are, however, lacking although efforts especially by regional research institutions and the governments are being initated. In particular, Malaysia and Singapore appear to have formalized their objectives for privatization in general and in their telecommunication sectors in particular, which are documented and published (Malaysia, Planning Unit 1985; Singapore, Ministry of Finance 1987, respectively).

Privatization of telecommunications in other Southeast Asian countries appears to be less rigorously documented and implemented. Because of this general lack of enunciated privatization policy and indepth analyses in other Southeast Asian countries, the approach adopted in this article will be two-fold. The first attempts a general discussion of the telecommunication sector and telecommunication policy in the Southeast Asian countries, and the second concentrates on a comparative focus between Malaysia and Singapore on one hand, and between these Southeast Asian countries and some industrialized countries on the other.