Hank Intven, the government's senior telecommunications specialist, has advised
Juan Belt of the Inter-American Development Bank (IDB) that it would be
highly unreasonable for the US administration to take punitive action against
Guyana for implementing a pro-competitive telecommunications agenda which
the US government champions around the world.
Intven, the team leader for the Information and Communications Technology
(ICT) project for Guyana, put this argument in a memo to Belt, Stabroek News
understands. Twice the IDB board has put off consideration of a loan for the
ICT Project and it is now not known when it would be considered. Intven's
argument is that the US administration ought not to take punitive action against
Guyana, since the loan project seeks to diversify Guyana's economy and
catapult it into the electronic service industry.
Atlantic Tele Network (ATN), parent company of the Guyana Telephone and
Telegraph Company (GT&T), has lobbied the US government against the
granting of the US$18 million loan for Guyana's US$22.5 million ICT project.
President Bharrat Jagdeo on Tuesday accused GT&T of trying to blackmail the
country and of bad faith in lobbying the IDB to block the IT (Information
Technology) loan.
ATN's argument is that the project will infringe on its monopoly rights in
Guyana, triggering action under the Helms Amendment, which would allow for
the US Executive Director at the IDB board to vote against the loan project.
The Helms Amendment protects against nationalisation or expropriation of a US
citizen's property, repudiation or nullification of a contract or any discriminatory
action against a US company.
Intven also told Belt in mid-May that the government has in good faith tried to
negotiate an amicable settlement to end GT&T's monopoly over the
telecommunications sector in Guyana.
"We have attempted to do so in a manner that is consistent with best
international practices, as promoted by the ITU, the WTO and OECD and
governments of most of the industrialised world, including the US," Intven was
quoted by Washington sources as saying to Belt.
Intven also pointed out that a detailed consultation paper on reform of the
telecommunications sector was published promoting reforms, including
competition and rate rebalancing. He said that the paper was consistent with
good practices adopted around the world in recent years and if adopted,
Guyana's telecommunications policies will be harmonised with those of most
industrialised and developing countries.
"GT&T's 30-year monopoly is an anachronism in today's telecommunications
market. Under the approach discussed in the paper this monopoly would be
terminated in a phased manner," Intven further told Belt.
The Canadian specialist also argued that GT&T should be able to prosper under
a liberalised regulatory regime, which included rebalanced rates and price cap
regulations.
"International experience suggests that if [GT&T] is a reasonably efficient
operator, [it] will retain its dominance over local telecommunications markets,
not by virtue of its legal monopoly but as a result of providing good service to
the public of Guyana," Intven was further quoted as saying.
Given the above scenario, Washington sources said, Intven argued that it would
be highly unreasonable for the US administration to take punitive action against a
developing country trying to implement market reforms.
ATN is reported to be arguing that because of its monopoly on voice and data
transmission, the project premised on liberalisation of these areas, infringes on its
rights. Initially, ATN was reported to have used the Public Utilities Commission
decision to award it only an interim increase in rates as a reason to trigger the
provisos under the Helms Amendment in its lobbying.
However, Washington sources said, Intven argued that rate making by an
independent regulatory agency, acting within its statutory powers and based on
advice by another US consulting firm could not be so construed. He argued that
the PUC used the reasoned methodology adopted by the US Federal
Communications Commission. He expressed the view, the sources said, that the
PUC decision could withstand judicial review in a Canadian court.
The government and GT&T were set to sign a memorandum of understanding
on the way forward for the relinquishing of its monopoly when ATN began
lobbying the US government to block the loan project for Guyana. Sources said
there was no intimation to the Government of Guyana via its negotiating team
that such action was being undertaken and the government team had forwarded
to Cabinet a draft memorandum for clearance for signing with GT&T and ATN.
Government sources have argued that GT&T's monopoly cannot be construed
to mean that it has a right to future technology.