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In the wave of telestroika.

Continuing a long history of technical assistance to its member nations, the Organization of American States (OAS) has recently taken an increasingly active role in the implementation of new telecommunications technologies in Latin America.

Alvaro Lopez Cayzedo, Coordinator of Telecommunications Projects for the OAS Department of Economic and Social Affairs (DESA), emphasizes the importance of the Organization's involvement in this growing industry. "Telecommunications are an integral part of the world economic system and to ensure optimum performance, each participant in the world economy must have an efficient and compatible means of communicating," says Cayzedo. He adds, "future economic growth will depend on how well integrated countries become with global information systems."

The OAS involvement in telecommunications is now a new phenomenon. The recommendation to erect a submarine telegraph cable linking San Francisco in the United States to Valparaiso in Chile was made at the First Inter-American Conference in 1893. Beginning in the 1920s, the OAS was active in radio communications projects leading to the establishment of the Inter-American Electric Communications Union in 1949. Subsequently, during the 1950s and 1960s, the Organization was instrumental in promoting the installation of the land-based Inter-American Telecommunications Network.

Throughout the past decade, an apparent world-wide disillusionment with state-run businesses has led to a trend in privatization. One of the industries most affected by this trend is the Latin American telecommunications industry. "Newly democractic countries in Latin America are taking steps to move away from the model of state-run industry," says William Berenson of the OAS Department of Legal Services. "Industries such as telecommunications had been capital starved and the best way to revitalize them seemed to be to spin them off into the private sector."

As a response to the move toward privatization which began in Chile in the early 1980s, the DESA has spear-headed a number of feasibility studies as well as planned and implemented integrated economic assistance programs in other nations seeking similar reforms. With a $ 1.2 million grant from the United States Trade and Development Program (TDP), a study was launched entitled "Modernization of Telecommunications Systems and Enterprises in OAS Member States," which examined the issues of digitalization of the public networks in Argentina, Colombia, Costa Rica, Mexico and Venezuela. This study focused on the demand for services, the design and cost/benefit analysis of network alternatives, and strategies to implement investments for the expansion of networks.

The tremendous interest generated by this first study led the DESA to launch additional feasibility studies for programs in Costa Rica, Honduras, Uruguay and Venezuela. In April, 1988, the U.S. TDP increased its grant to $2.7 million to cover this second phase. The Honduran and Uruguayan components are analyses of the potential for digitalization and another study in Uruguay looks into the possible integration of the Argentine and Uruguayan systems through a fiber optic link. A consultant in Venezuela has completed the design for an underseas fiber optic cable between Caracas and Puerto Rico. This cable will link with major international cables in the area, thus increasing communications capabilities. The project in Costa Rica involves the design of a centralized operations and maintenance center, as well as a fiber optic ring around San Jose.

In addition to the projects funded by U.S. TDP, the OAS has embarked on a five-country project with support from the Government of Italy in the amount of $1.5 million. The Italian consulting firm, CONSULTEL, is implementing digitalization studies in some of the countries involved in this project, which includes Bolivia, Colombia, Ecuador, Guatemala and Peru. Several million dollars of additional funding for future OAS projects is expected to come from the private sector.

Along with the technical studies undertaken by DESA, the Organization has held several important conferences recently to help those involved in the privatization movement in Latin America become more familiar with state-of-the-art technologies as well as the legal intricacies of the reform process. In September, 1989, a symposium on "New Telecommunications Technology" was attended by ministers and directors of telecommunications enterprises from over 12 Latin American countries, as well as senior representatives from major corporations. At the opening ceremony of this symposium held in Washington, D.C., the Secretary General of the OAS, Ambassador Joao Clemente Baena Soares commented on the necessity of modernizing the existing systems in Latin America, "not only to become more competitive internationally, but also to promote increased internal productivity and the development of complimentary activities in the area of commercial services."

In December, 1990, the OAS, in conjunction with International Solutions, Inc., held an international symposium in Miami on "Trends in Telecommunications Technologies and Management." Another workshop, held at the OAS in April of this year, focused on the legal aspects of privatization and new industry structure and regulatory frameworks. Mark Fowler, senior communications counsel for the law firm of Latham & Watkins, co-sponsors of the workshop, told participants "to privatize or not to privatize is not the question." Fowler explained, "a rational regulatory regime must be established that fosters both sound investment and the benefits of competition, including innovation, efficiency and responsiveness to human needs." The question of regulatory bodies was dealt with in a subsequent international conference held in July in Caracas, Venezuela.

The movement towards privatization has brought about not only compatible phone lines, but a certain compatibility in trade and investment policies in and outside the region. Without foreign investment, many states are unable to maintain essential technological resources. The recently privatized telecommunications industries in Chile and Argentina serve as valuable examples of how the process can be effectively implemented throughout the region.

Modernization of the telecommunications infrastructure throughout Latin America is seen as a key to furthering the economic development of many of the OAS member nations. With the continued success of the programs intitiated by the OAS, which allow for an important exchange of information and technology, "telestroika," (telecommunications liberalization) could become more than a buzzword in Latin America. It just might be the right current for the future.

James Kiernan is Director of the OAS Office of Coordination for the Quincentennial Commemoration of the Discovery of America. Encounter of Two Worlds.
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No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Organisation of American States' telecommunication policy
Author:Restrepo, Daniel
Publication:Americas (English Edition)
Date:May 1, 1991
Previous Article:Encountering a contest.
Next Article:The General in His Labyrinth.

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