Share this story
Close X
Switch to Desktop Site

US Wants Europeans To Join Negotiations


A TRANSATLANTIC call from the United States costs only a fourth to a half as much as a similar call from Europe. High-capacity, high-speed fiber-optic networks cost on average eight times as much in the European Union as in the United States. And a high-capacity leased data link in the US costs about one-tenth as much as the same line in some member states of the EU, according to the Clinton administration.

The administration evidently wants to see this American bounty of cheaper communication shared in Europe, hoping to get more business for US firms. The EU has a target date of Jan. 1, 1998, for a new wave of telecommunications liberalization. But the White House is pushing for a World Trade Organization (WTO) agreement on telecommunications by April 30, 1996.

About these ads

The US has put on the table a comprehensive offer covering, among other things, market access and pro-competitive regulation in voice, fax, telex, telegraph, and video-transport services. This offer also includes a willingness to negotiate away a long-time issue with US trading partners: restrictions on foreign investment in radio-based telecommunications.

As trade negotiators count time, April 30 is just about the day after tomorrow, and the Clinton administration has been complaining that there aren't even enough opening offers submitted to begin meaningful discussions.

Reed Hundt, chairman of the US Federal Communications Commission (FCC), here to address the prestigious ''Munchner Kreis'' (Munich Circle) telecommunications conference last week, used the opportunity to express his disappointment that the European Union had not yet submitted a WTO proposal. Japan has offered a proposal - one he pointedly described as ''inadequate.'' He also rejected the ''half a loaf'' approach for which trade negotiators often settle.

Similarly, Deputy US Trade Representative Jeffrey Lang has been touring European capitals, seeking more partners for the telecommunications ball in Geneva.

The April 30 target date derives from an April 1994 agreement by ministers of WTO member countries. Unable to reach agreement on telecommunications trade at the time of the launch of the WTO, the ministers nonetheless did agree to reach an agreement within two years.

Ambassador Lang told a press luncheon in Bonn that by the end of this week it should be clear whether the April target is reachable. That is when he is to meet with senior trade officials from other countries in Geneva. ''There is still time to get this negotiation going,'' he said, but warned that ''by the end of October, time may have passed us by.''

German and other European officials have received the US negotiating offer but have been very quiet about it - ''really quite neutral,'' as one official put it. One reason the EU has not prepared its offer is that Germany and France are concerned about how the FCC treats the proposed ''Phoenix'' joint venture - involving Deutsche Telekom, Telecom France, and Sprint. Europeans see the Americans as often more interested in gaining access to European markets than granting access to American ones.

About these ads

One official suggests that there may well be a European offer for the WTO negotiations after next month's ministers' meeting in Brussels. But the EU has been focused on its own Jan. 1, 1998, target for members to have their own, individually worked out telecoms programs in place.

In Germany, draft legislation will be taken up in the Bundestag in the next couple of weeks, with the expectation of passage by next summer. This should leave 1997 to set up new structures and regulatory regimes, so that Germany will be able to ring in 1998 with liberalized, privatized, competitive telecommunications. The inside view is that some slippage in the timing is likely - not a first within the EU - but that Germany is serious about shaking up Deutsche Telekom, its state-owned monopoly.

Follow Stories Like This
Get the Monitor stories you care about delivered to your inbox.