It has become increasingly common for developing-country governments to extract rents from what they think is an easy target, international communication. After all, the people affected don’t vote in their elections, even if they are in many cases, hardworking expat workers who keep the home economies afloat. But telecom users are not stupid. They have been switching to alternatives in a big way, says Telegeography: First up is the curious discovery that 2015 marked a turning point in the market. It was the first time since the Great Depression that international carrier voice traffic declined.
As part of the international telecom services liberalization of 2003, the government started collecting a levy from international calls for universal service. The intention was to reduce the amounts every year and also to give out the money as quickly as possible. What happened was different. The percentage was not reduced and money was not disbursed. Finally, it has started to flow out.
When I ceased to proffer policy advice to the government of Bangladesh some time back, I predicted that the International Long Distance Telecommunication Services Policy would fail, and that bypass would not be eradicated. Seeing a report that massive bypass was reemerging after a quiet period following arrests and confiscations, I wrote an oped in the Daily Star urging a reworking of the policy. Here is an excerpt: In 2007 when the government-appointed committee formulating the international Long Distance Telecommunication Services (ILTDS) Policy sought my advice, I told them that the larger policy objectives would be best served by liberalising international gateways. Liberalisation would enhance the competitiveness of Bangladesh’s export industries and create conditions for the efflorescence of the business process outsourcing (BPO) industry, thereby generating white-collar jobs for educated youth. It would eradicate the cancer of black money generated from the bypass business that was corroding the country’s body politic.