Mastel wants govt to clarify new telecoms policy

JAKARTA (JP): Indonesian Telecommunications Society (Mastel) called on the government on Friday to clarify its plan to allow foreign investors to own up to 95 percent in local telecommunications companies.

Mastel chairman Soekarno Abdulrachman said the policy was ambiguous because it was not clear whether foreign telephone operators would be allowed to set up their wholly owned businesses here before or after the termination of the exclusive rights awarded to PT Telkom and PT Indosat.

"It's a good plan. But, it's really vague. The government must clarify the plan to avoid misunderstandings among foreign investors," he told a media conference.

He was commenting on the government's recent plan to revise the controversial Presidential Decree No. 96/2000 on negative lists of foreign investment by changing the percentage of company shares allowed to be owned by foreign investors.

State Minister of Investment and State Enterprises Rozi Munir said last week that he would ask President Abdurrahman Wahid to revise the decree by omitting the information multimedia services from the lists and changing the foreign ownership limit in telecommunication companies to 95 percent from 49 percent.

The revised decree was expected to be issued by the first week of September.

Sukarno said it was good for the government to open up its telecommunications sector for foreign investors because not many local investors were financially capable to finance the high-cost telecommunications projects.

However, the government needed to clarify its plan as it contradicted an existing policy that bans local private and foreign telephone companies from setting up their own businesses in local and international telephone service, he said.

The government has decided to speed up the removal of the monopoly awarded to Telkom and Indosat to 2002 and 2003 from the original schedules of 2010 and 2004, respectively.

Sukarno, the former director general of telecommunication, also asked the government to clarify whether the new investment policy in telecommunications would be applied to both basic and non-basic telecommunication services.

The existing regulations clearly distinguish between the basic services, which relate to telephone infrastructures and call services providers such as Telkom, Indosat and mobile telephone operators, and non-basic services, which include radio trunking and paging services.

Under these regulations, foreign investors can only control a maximum of 35 percent of shares in companies that provide basic services, but are allowed to own up to 95 percent in companies that provide non-basic services, he said.

"Personally, I think we'd better maintain our control of the telephone infrastructures and call service businesses for the sake of national development interest," he said, adding that he was afraid foreign companies would not want to build access lines in remote areas as they would consider it unprofitable. (cst)