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Opening up telecommunications to competition and MENA integration in the world economy

  • Khalid Sekkat
  • Carlos Maria Rossotto
  • Aristomene Varoudakis

This paper investigates the potential impact of opening up telecommunications to competition in MENA on this sector performance and on the participation of the region in the world economy. The latter is assessed with respect to manufactured exports, participation in production network and attractiveness of FDI. The paper first introduces a model to assess the benefits of telecommunications liberalization on sector performance. The assessment is based on three key factors: (i) degree of effective competition in fixed and mobile networks; (ii) openness to foreign investment; and (iii) pro-competitive regulation. The results confirm that liberalization and open markets are conducive to higher efficiency in the telecommunications sector. Regarding the integration of the region in the World economy, the analysis confirms that, after controlling for the influence of other structural factors, better performance of telecommunications strengthens export performance in manufacturing including exports of intermediate products. Moreover, by facilitating linkages with transnational production networks and reducing the cost of doing business, better telecommunications sector performance is found to be a determinant of foreign direct investment inflows in developing countries. Copyright © 2005 John Wiley & Sons, Ltd.

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Paper provided by ULB -- Universite Libre de Bruxelles in its series ULB Institutional Repository with number 2013/7368.

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Date of creation: 2005
Date of revision:
Publication status: Published in: Journal of International Development (2005) v.17 n° 7,p.931-955
Handle: RePEc:ulb:ulbeco:2013/7368
Note: SCOPUS: ar.j
Contact details of provider: Postal: CP135, 50, avenue F.D. Roosevelt, 1050 Bruxelles
Web page: http://difusion.ulb.ac.be

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  1. Robert C. Feenstra, . "Integration Of Trade And Disintegration Of Production In The Global Economy," Department of Economics 98-06, California Davis - Department of Economics.
  2. Mattoo, Aaditya & Rathindran, Randeep & Subramanian, Arvind, 2001. "Measuring services trade liberalization and its impact on economic growth : an illustration," Policy Research Working Paper Series 2655, The World Bank.
  3. Khalid Sekkat & Aristomene Varoudakis, 2000. "Exchange rate management and manufactured exports in Sub-Saharan Africa," ULB Institutional Repository 2013/7342, ULB -- Universite Libre de Bruxelles.
  4. Lucas, Robert E. B., 1993. "On the determinants of direct foreign investment: Evidence from East and Southeast Asia," World Development, Elsevier, vol. 21(3), pages 391-406, March.
  5. Schneider, Friedrich & Frey, Bruno S., 1985. "Economic and political determinants of foreign direct investment," World Development, Elsevier, vol. 13(2), pages 161-175, February.
  6. Peter Cowhey & Mikhail M. Klimenko, 2000. "Telecommunications reform in developing countries after the WTO agreement on basic telecommunications services," Journal of International Development, John Wiley & Sons, Ltd., vol. 12(2), pages 265-281.
  7. David Hummels & Jun Ishii & Kei-Mu Yi, 1999. "The nature and growth of vertical specialization in world trade," Staff Reports 72, Federal Reserve Bank of New York.
  8. Avinash K. Dixit & Gene M. Grossman, 1981. "Trade and Protection with Multistage Production," NBER Working Papers 0794, National Bureau of Economic Research, Inc.
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