The role of competition in institutional reform of telecommunications: lessons from Sri Lanka

Rohan Samarajiva

Telecommunications Policy, 2000, vol. 24, issue 8-9, 699-717

Abstract: Consolidation of the recent wave of institutional reforms in telecommunications requires assessment of the position of competition in relation to organizational reform of incumbents and the establishment of regulation. Drawing lessons from the experience of Sri Lanka, a country which has achieved good results from comprehensive reforms over a nine-year period, the article concludes that competition plays the most important role. In addition to the direct benefits of increased investment, lower prices and higher levels of connectivity, quality of service and innovation, competition reinforces organizational reform of the incumbent, contributes to the consolidation and legitimation of regulation and prevents the rollback of advances in organizational reform of the incumbent and in regulation. The article also draws general conclusions from the policy choices made by Sri Lanka regarding the strategy of introducing competition; the sequence of privatization and competition; the balance between telecommunications sector objectives and yield maximization from privatization/ownership; universal access/service; managing competition within technology-defined subsectors; and ongoing regulation for competition.

Keywords: Competition; Regulation; Privatization; Institutional; reform; Sri; Lanka (search for similar items in EconPapers)
Date: 2000
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