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Telecommunications reform in Indonesia: Achievements and challenges

  • Roy Chun Lee
  • Christopher Findlay

Telecommunications reform in Indonesia has occurred in two phases. In the first, from 1989, private participation was permitted in the fixed-line sector through public-private partnership (PPP) arrangements. In the current reform phase, which began in 1999, a duopoly structure was created in fixed-line sector operations, accompanied by a pro-competitive regulatory regime. The first reform phase was not successful. This paper explains that contract-based PPP programs provided only short-term solutions to the problem of lack of capacity. The more wide-ranging 1999 reforms acknowledge the importance of competition and a sound regulatory regime in telecommunications reform, but there are still limits on market entry, and the problems of lack of interconnection and network development disparities remain.

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Article provided by Taylor & Francis Journals in its journal Bulletin of Indonesian Economic Studies.

Volume (Year): 41 (2005)
Issue (Month): 3 ()
Pages: 341-365

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Handle: RePEc:taf:bindes:v:41:y:2005:i:3:p:341-365
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  1. Hank Intven, 2000. "Telecommunications Regulation Handbook," World Bank Publications, The World Bank, number 15249.
  2. Nicholas Economides, 1997. "The Economics of Networks," Brazilian Electronic Journal of Economics, Department of Economics, Universidade Federal de Pernambuco, vol. 1(0), December.
  3. Peha, Jon M., 1999. "Tradable universal service obligations," Telecommunications Policy, Elsevier, vol. 23(5), pages 363-374, June.
  4. Mark Armstrong & Simon Cowan & John Vickers, 1994. "Regulatory Reform: Economic Analysis and British Experience," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262510790, June.
  5. John Vickers & George Yarrow, 1991. "Economic Perspectives on Privatization," Journal of Economic Perspectives, American Economic Association, vol. 5(2), pages 111-132, Spring.
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