John Stupka, president of MCI WorldCom, ventures and alliances, has aired his concerns on the situation in Mexico, where the local telecoms carrier has a monopoly position. The time has come, according to Stupka, for Mexico to be held accountable.
"While MCI WorldCom has concerns about the implementation of the WTO agreement in various countries, the situation in Mexico is especially egregious. The problems in the Mexican telecom market are extremely serious, and we encourage USTR to take decisive action to resolve these problems. The engagement of the US government would bring a glimmer of hope to what has otherwise been a dark chapter in US-Mexican trade relations."
Stupka continued: "Competitive carriers in Mexico have essentially been mugged by Telmex, the dominant Mexican telecommunications carrier, which has used its monopoly position to maintain its stranglehold on Mexican consumers. Telmex has engaged in a classic price squeeze which allows it to make more money from its competitors than from the customers it loses; where cost to the competitors is not the issue, it has used its control of essential facilities to stop its competitors from deploying their products; and it has successfully paralysed the Mexican regulator.
"A competitive telecommunications market, which Mexico committed to in the WTO Telecom Agreement, is the foundation of the new information economy. As a result of Mexico's failure to live up to its WTO obligations, Telmex has maintained its monopoly and consumers have been denied better prices, greater choices, and higher quality services. The Mexican government has been repeatedly urged by US government agencies, the OECD, international private industry groups, and independent researchers to meet its international commitments. Despite this chorus, the regulator has been more concerned with the financial health of Telmex than the emerging competition for Mexican consumers."