Telecom reforms in developing countries and the outlook for electronic commerce

This article looks at the elements that are necessary for the introduction of electronic commerce in developing countries. Two elements determine the successful adoption of e-commerce in developing countries: access to cheap information technology equipment for consumers and the supply of telecommunications services to computer and internet users at low rates. In the World Trade Organization (WTO), negotiations have been conducted and agreements concluded that contribute to lowering prices of both telecommunications services and computer hardware and software. The relevant agreements are the Information Technology Agreement (ITA) and the 4th Protocol of GATS relating to basic telecommunications. The degree to which developing country members have implemented both agreements varies considerably. With respect to the ITA, general trends concerning tariff cuts are established for different products most relevant for e-commerce. To determine the liberalization of telecommunications services under the GATS, different parameters showing the possibility of competition among service providers are established.