THE World Trade Organisation (WTO) has predicted a pact to open global telecommunications to the free market would pump new funds into the world economy, create countless jobs and slash phone costs to consumers.
The optimistic forecast, echoed by government leaders in Washington and other capitals, was issued after officials from 68 countries clinched the deal late on Saturday at the end of over three years of negotiations.
This is good news for the international economy, it is good news for businesses, and it is good news for the ordinary people around the world who use telephones or who want to use them,"said the WTO director general, Mr Renato Ruggiero.
Ending government and private monopolies that still control the industry in many countries would bring rapid growth over the whole telecoms sector and could add $1 trillion - or four per cent - over the next decade to the value of world economic output, he said.
In Washington, President Clinton hailed the pact - expected to go into force in 1998 - as offering more jobs, new markets and lower prices to US workers, firms and consumers. For most companies around the world, outgoing's on telecoms come only second to labour costs on the debit side of their balance sheets, economists say.
Like Mr Ruggiero, who argued a deal would help the poorest countries most by putting a "phone in every village", President Clinton said it would "spread the benefits of a technology revolution to citizens around the world". The breakthrough, which for the first time puts one of the world's major service industries almost fully under the open trade rules of the two year old WTO, came when the United States decided to sign up. But Washington held back until just a few hours before the deadline, leaning on major trading partners like Canada and Japan to commit themselves to a higher level of foreign ownership of telecom firms.
In its turn, the United States was also under pressure not to "walk away from a deal - as it had when earlier negotiations peaked last April - which offered cover of over 90 per cent of the world telecoms market.
Just a day before the US decision, the European Union Trade Commissioner, Sir Leon Brittan, said what was on the table was so good that "it would be crazy not to grab it with both hands" while US telecoms companies also pushed for the pact.
The United Nations International Telecommunications Union (ITU) threw in its weight, issuing a report saying world growth depended largely on the telecoms industry which ranks third behind banking and health care in market capitalisation.
The ITU, which monitors results from the entire telecoms sector around the world, says revenues from the services side of the industry covered by the new WTO pact totalled just over $600 billion in 1995 and climbed to around $670 billion last year.
The telecoms pact is not a textual accord but an agreement by all 68 countries - who by Saturday had submitted "offers" on the degree to which they would open their domestic markets - that each others packages were good enough for a deal.
Once the pact is in force following approval by national legislatures of their country's offer each of the 68 will have to live up to their commitments or face challenge under the WTO's dispute settlement system - and sanctions if they are found wanting.
