Information and communications are essential element of international trade and investment.  The rapid development of technologies, including video conferencing, electronic mail, facsimile, and the Internet, has facilitated expansion of businesses beyond national boundaries.  Managers can now be connected instantly to almost all corners of the world without having to leave their offices.  With accelerating globalisation of business, and worldwide de-regulation and liberalisation, effective telecommunications is gaining tremendous importance, particularly when organisations decide on the location of production and service facilities.

In January 1998, the Centre for TeleMedia Strategy published the first Asia Pacific Telecommunications Index.  The Index ranked ten economies in the Asia Pacific region by their competitiveness in telecommunications on dimensions of service, choice, regulation and pricing.  It provided national regulators and service providers with a simple, yet credible competitive benchmark.  Over 100 multinationals from over 22 countries provided data on the performance of
dominant telecommunications providers in the region.  The 1998 Index was updated in June to account for substantial changes in exchange rates and prices.

The geographical coverage of the 1999 Index has been expanded to 13 regional economies.  The Index ranks each of these economies on four dimensions of telecommunications competitiveness – service, choice, regulation, and pricing.  It integrates these rankings to provide the overall Asia Pacific Telecommunications Index.
 

Asia Pacific Telecommunications Index 2000

In Index 1999, the top 4 ranking economies were Singapore, Australia, Hong Kong, and Japan, with 3.8% points separating the leader from the fourth ranking economy.  This year, Australia has overtaken Singapore to take the lead, and Hong Kong and Japan have moved up to share second place.  In Index 2000, the most competitive economies, in terms of international telecommunications are Australia, followed by Hong Kong and Japan, and Singapore.

Clearly, as concluded in our previous studies, the region is still being led by this cluster of economies.  Compared with 1999, we see evidence that the degree of competition has increased: the percentage difference between the leading and fourth-ranking economy has shrunk to 1.5% in 2000 from 3.8% in 1999.

The leading cluster of economies is followed by an intermediate cluster consisting of New Zealand, Korea, and Taiwan.  The final cluster consists of Malaysia, Thailand, Philippines, Indonesia, India, and China.  The overall ranking in the final cluster has not changed since last year.
 

ORDER THE INDEX 2000
 

Asia Pacific Telecommunications Index 1999

The figure below reports the Asia Pacific Telecommunications Index 1999.  Singapore and Australia lead, taking the top two positions.  Hong Kong has overtaken Japan for third place.  From a broader perspective, this study confirms a finding of last year’s study that the region is led by a cluster of economies – Australia, Hong Kong, Japan, and Singapore – all of which closely contend for the position of the most competitive telecommunications hub in the region.
 

As the Index 1999 report will explain in considering the individual sub-indexes for service, pricing, choice, and regulation, the overall ranking masks considerable variation within the four dimensions of telecommunications.  Singapore dominates in pricing but is weak in choice.  Australia is an all-rounder, rating among the top 4 on all dimensions of telecommunications – service, pricing, choice, and regulation – but is not top on any one.  Hong Kong dominates in regulation, but is weak in choice.  Japan continues to dominate in service but rates poorly in pricing.

The top tier economies are followed by an intermediate cluster consisting of Korea, New Zealand and Taiwan.  The final cluster consists of Malaysia, Thailand, the Philippines, Indonesia, India, and China.

The table below compares the 1999 index with the 1998.  All economies have achieved higher ratings: Malaysia achieved the highest increase of 33%, while Singapore was lowest at 14%.  (This year’s study included China, India, and New Zealand for the first time, hence there is no comparison with their 1998 performance.)  There are two reasons for the higher ratings – substantial changes in pricing and a change in our methodology in measuring choice.  We will discuss these in detail below.

ORDER THE INDEX 1999
 

Asia Pacific Telecommunications Index 1998

Over the ensuing 6 months, there has been tremendous change in many of the regional economies. Specifically, there have been significant shifts in exchange rates, with potential implications for relative competitiveness in terms of pricing.  How have service providers responded? Have they adjusted their prices to counteract changes in exchange rates, or have they maintained their prices and hence increased price competitiveness?

The Index 1998 aims to address these questions and generally assess the impact of the recent financial changes on telecommunications competitiveness.  Further, the report includes a refinement in the method used to calculate the sub-index for pricing index. The other sub-indexes (for service, choice and regulation) remain unchanged from the January 1998 Report.

The figure below shows the ranking of the ten economies in June 1998. Singapore leads in the index, with a 4-point lead over the next four economies - Japan, Hong Kong, Korea and Australia, which are tightly packed within a 2-point band. Taiwan ranks in the middle followed by Thailand and Malaysia. Indonesia and Philippines, which were the lowest in the index, had almost identical scores.
 

To understand the changes in competitiveness between January and June, the table above shows the ratio of the June to the January 1998 indexes for each of the ten economies.  Thailand and Singapore showed the greatest improvement.

This report focused on the impact of recent fluctuations in exchange rates on telecommunications competitiveness.  Specifically, the Report identified the extent to which changes in competitiveness were due to changes in exchange rates as distinct from consequent changes in local currency prices by the dominant service providers.   Thailand and Singapore registered the largest improvements in price competitiveness between January and June 1998. These improvements were due to both exchange rate depreciation and reduction in local currency prices.  Consequently, the two economies registered increases in their overall competitiveness of 11% and 5% respectively.
 
 
 
 
 
 

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