WASHINGTON-A major breakthrough in efforts to ink a global telecom free trade pact by mid-February came last week as the European Union agreed to liberalize wireless mobile markets by 1998 and to relax restrictions elsewhere.

But the 15-member EU let it be known in Geneva that it wants the United States, Canada, Japan, Singapore, Korea, Brazil, Mexico and others to reciprocate.

“We are trying to create momentum in the negotiations, and hope our other partners will join us in tabling improved offers,” said Karl-Fredrik Falkenberg, senior EU negotiator, in a Reuters dispatch.

The United States responded immediately by removing restrictions on access to submarine cable landing licenses, which the EU had requested.

The EU will liberalize telecom markets by 1998, separate from World Trade Organization negotiations. But before doing so, the organization would like assurances that its members will be able to do business in the telecommunications markets of the other 124 member states.

The key to the new EU offer is Spain.Spain-resistant until now to open its potentially lucrative market-agreed to open its telecommunications markets by 1998 instead of by 2003. Limits on foreign investment in Spain and Belgium were dropped, and France withdrew indirect foreign investment restrictions.

In addition, the EU removed all satellite communications trade barriers. The White House and Congress are pushing to revamp the International Mobile Satellite Organization and the International Telecommunications Satellite Organization. Each is a multinational consortium with certain privileges and immunities.

Though the EU said it would open all wireless markets by 1998, Ireland and Portugal would still maintain minor regulatory measures.

In fact, Ireland is not expected to completely open its market until 2000. Greece and Portugal will likely do so three years later. But because the three countries’ telecom markets are not considered major-at least compared to Spain-the delay is not expected to kill the deal.

Negotiations among WTO members have been off and on for the past year-and-a-half to reach a telecom trade treaty by Feb. 15, a new deadline set after failure to reach an agreement in April.

“There is not much time left to conclude these negotiations and significant progress must be made by the Singapore Ministerial Conference if we are to succeed by February,” said Jeffrey Lang, deputy U.S. trade representative.

“The revised U.S. and European offers provide a solid basis for the United States and the European Union to obtain more and better offers from other WTO members at Singapore,” he added, referring to the ministerial meeting, Dec. 9-13.

Despite the progress, the United States continues to have telecom trade skirmishes. The latest dust-up has the United States accusing Korea of thwarting American entry into its telecommunications services and equipment markets.

Technical level talks were held Oct. 31 and Nov. 1 and 2 in Washington, D.C., but negotiators failed to make progress.

A U.S. trade official said Korea’s wireless telecom market is still relatively closed off to American firms.

Meanwhile, the United States is working to secure an agreement by the end of this month with the Asia-Pacific Economic Cooperation’s 18 members to phase out tariffs on telecommunications and information technology products by 2010 for developed economies and by 2020 for developing nations.

President Clinton and acting U.S. Trade Representative Charlene Barshefsky (who Clinton reportedly intends to nominate for the position on a permanent basis) are scheduled to attend the APEC meeting Nov. 22-25 in Manila, the Phillipines.


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