regulation and investment bangladesh case study
DESCRIPTION
Regulation and Investment Bangladesh Case Study. Harsha de Silva and Abu Saeed Khan. Objective. To assess the relationship, if any, between the TRE and telecom investments in Bangladesh. Structure. Introduction Methodology and data issues TRE Market Entry Access to Resources - PowerPoint PPT PresentationTRANSCRIPT
Regulation and InvestmentRegulation and InvestmentBangladesh Case StudyBangladesh Case Study
Harsha de Silva Harsha de Silva
and Abu Saeed Khanand Abu Saeed Khan
LIRNEasia 17-18 September 2004, Colombo
ObjectiveObjective
To assess the relationship, if any, To assess the relationship, if any, between the TRE and telecom between the TRE and telecom investments in Bangladesh.investments in Bangladesh.
LIRNEasia 17-18 September 2004, Colombo
StructureStructure
1.1. Introduction Introduction 2.2. Methodology and data issuesMethodology and data issues3.3. TRE TRE
1.1. Market EntryMarket Entry2.2. Access to ResourcesAccess to Resources3.3. InterconnectionInterconnection4.4. TariffTariff5.5. Anti-competitive practicesAnti-competitive practices
4.4. InvestmentsInvestments5.5. ConclusionsConclusions
LIRNEasia 17-18 September 2004, Colombo
Introduction:Introduction: South Asia South Asia
Private Investment in Telecom. Developing World vs. South Asia
4.60
10.40
6.208.00
15.5017.10
24.90
39.60
51.00
35.70
45.50
39.60
23.70
0.01 0.03 0.02 0.06 0.06 0.6 1.504.00
0.7 1.30 0.83.60 4.90
0
10
20
30
40
50
60
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002
US$
bill
ions
Developing World
South Asia
Source:Private Participation in Infrastructure Database, The World Bank
LIRNEasia 17-18 September 2004, Colombo
Introduction:Introduction: India leads in volume… India leads in volume…
Comparison of private investments [without divestiture]
0
500
1000
1500
2000
2500
3000
3500
4000
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002
USD
million, In
dia
0
100
200
300
400
500
600
700
800
USD
million, Bangla
des
h, Pakis
tan
and
Sri
Lanka
India
Sri Lanka
Bangladesh
Pakistan
Source: Calculated from The World Bank database on Private Participation in Infrastructure Projects
LIRNEasia 17-18 September 2004, Colombo
Introduction:Introduction: Sri Lanka higher per capita Sri Lanka higher per capita
Comparative Investments, 1989 - 2002 [excluding divestiture proceeds]
10.65.3
32.2
3.91.4
0
10
20
30
40
India Bangladesh Sri Lanka Pakistan Nepal
USD
/p
er c
apit
a
Source: Calculated from The World Bank database on Private Participation in Infrastructure Projects
LIRNEasia 17-18 September 2004, Colombo
Introduction:Introduction: Bangladesh structure Bangladesh structure
Fixed Sector
BTTB, 0.9
BRTA, 0.02
0
0.5
1
1.5
2
2.5
3
3.5
Mobile Sector
Grameen, 2
PBTL, 0.3
AkTel, 0.8
Sheba, 0.05
0
0.5
1
1.5
2
2.5
3
3.5
Mill
ion
line
s
As at July 2004
Methodology and Data Methodology and Data IssuesIssues
LIRNEasia 17-18 September 2004, Colombo
Methodology and Data IssuesMethodology and Data Issues
MethodMethod• Samarajiva et al: Sri Lanka CaseSamarajiva et al: Sri Lanka Case
TRE; 5 componentsTRE; 5 components Fit with investment dataFit with investment data No periods, compare with regionNo periods, compare with region
Data issuesData issues• AvailabilityAvailability
Brief study, non scientific data collectionBrief study, non scientific data collection Investment figures not readily availableInvestment figures not readily available
• QualityQuality Discrepancies; WB database vs. Operators vs. GoBDiscrepancies; WB database vs. Operators vs. GoB
TRETRE
LIRNEasia 17-18 September 2004, Colombo
TRE:TRE: Market entry Market entry
Fixed SectorFixed Sector• Inconsistent Inconsistent
licensinglicensing PBTL, Sheba, PBTL, Sheba,
WorldTelWorldTel Formula OneFormula One
• PSTN licensing PSTN licensing [2004][2004]
Mobile SectorMobile Sector• Inconsistent license Inconsistent license
feesfees• PHSPHS• BTTB mobileBTTB mobile
LIRNEasia 17-18 September 2004, Colombo
TRE:TRE: Access to resources Access to resources
Fixed SectorFixed Sector• Non-existent Non-existent
spectrum spectrum managementmanagement
• SMCSMC• Bangladesh RailwayBangladesh Railway
Mobile SectorMobile Sector• BTRC reserving BTRC reserving
spectrum for BTTBspectrum for BTTB• Disparity in Disparity in
spectrum spectrum distributiondistribution
• BRBR
LIRNEasia 17-18 September 2004, Colombo
TRE:TRE: Interconnection Interconnection
Fixed SectorFixed Sector• Interconnection Interconnection
with BTTBwith BTTB• Licensing private Licensing private
interconnection interconnection operator?operator?
Mobile SectorMobile Sector• Interconnection Interconnection
with BTTBwith BTTB• Mobile-mobileMobile-mobile
ATOB Tandem $2MMATOB Tandem $2MM UNDP/ITU switchUNDP/ITU switch
LIRNEasia 17-18 September 2004, Colombo
TRE:TRE: Tariff regulation Tariff regulation
Fixed SectorFixed Sector• Ministerial Ministerial
interferenceinterference• VoIP [budget IDD] VoIP [budget IDD]
Mobile SectorMobile Sector• Regulatory vetting Regulatory vetting
in tariff reductionin tariff reduction• Non-compliance Non-compliance
with BTTB long with BTTB long distance reductiondistance reduction
LIRNEasia 17-18 September 2004, Colombo
TRE:TRE: Regulation of anti-competitive Regulation of anti-competitive practicespractices
Fixed SectorFixed Sector• BTTB BTTB
interconnectioninterconnection• GP + X-NetGP + X-Net• PGCBPGCB
Mobile SectorMobile Sector• Denying access to Denying access to
budget IDDbudget IDD• BTTB: One-way BTTB: One-way
revenuerevenue• PHS + BTTB Mobile PHS + BTTB Mobile
interconnection and interconnection and tarifftariff
• GP + X-NetGP + X-Net• PGCBPGCB
LIRNEasia 17-18 September 2004, Colombo
TRE summaryTRE summary
FixedFixed MobileMobile
EntryEntry PoorPoor PoorPoor
AccessAccess PoorPoor UnsatisfactoryUnsatisfactory
InterconnectInterconnect PoorPoor PoorPoor
TariffTariff UnsatisfactoryUnsatisfactory UnsatisfactoryUnsatisfactory
Anti-competitionAnti-competition PoorPoor PoorPoor
Scale: Poor, Unsatisfactory, Neutral, Satisfactory, Excellent
InvestmentsInvestments
LIRNEasia 17-18 September 2004, Colombo
Investments:Investments: Fixed sector: pattern? Fixed sector: pattern?
Development Expenditure in BTTB
0
100
200
300
400
500
Period
USD
mill
ion
1990-95 1995 -97 1997-2000 2003
Source: AHM Shafiqul Islam, 2004
LIRNEasia 17-18 September 2004, Colombo
Investments [lack of]:Investments [lack of]: Reasons Reasons Poor/unsatisfactory TRE Poor/unsatisfactory TRE GoB budgetary allocationsGoB budgetary allocations
• Difficult times Difficult times low investments low investments Continuous difficultiesContinuous difficulties
• Competing prioritiesCompeting priorities Unable to “close” dealsUnable to “close” deals
• External interferenceExternal interference Driven by donor interestDriven by donor interest
LIRNEasia 17-18 September 2004, Colombo
Investments [lack of]:Investments [lack of]: Mobile pattern Mobile pattern
Investments by Mobile Operators
0
20
40
60
80
100
120
140
160
96-97 97-98 98-99 99-00 00-01 01-02 02-03
USD
mill
ions
PBTL
AkTel
GP
Sources: External Affairs Director GrameenPhone, Managing Director AKTEL and Finance Director PBTL.
LIRNEasia 17-18 September 2004, Colombo
Investments [lack of]:Investments [lack of]: Reasons? Reasons?
Poor/unsatisfactory TREPoor/unsatisfactory TRE• Missed opportunities?Missed opportunities?
GPGP• Growing “private network”Growing “private network”
More recently AkTelMore recently AkTel ““Getting ready” for “unfair” BTTB Getting ready” for “unfair” BTTB
mobilemobile
LIRNEasia 17-18 September 2004, Colombo
Conclusions:Conclusions: circumstantial evidence of circumstantial evidence of better TRE better TRE higher investments? higher investments?
Per Capita Private Investment in Mobile Telecoms 1996/ 97 -2003
0
0.5
1
1.5
2
2.5
1997 1998 1999 2000 2001 2002 2003
USD
Bangladesh Sri Lanka
Sources: From Operators in Samarajiva et al [2004] for Sri Lanka, Operators for Bangladesh
Bangladesh Case Study Ends.Bangladesh Case Study Ends.
Help in funding, information, time and views are Help in funding, information, time and views are greatefully acknowledged.greatefully acknowledged.
Harsha de Silva: Harsha de Silva: [email protected]@lirne.net Abu Saeed Khan:Abu Saeed Khan:[email protected]@bol-online.com