NTT to chase China, Southeast Asia

NTT to chase China, Southeast Asia

TOKYO (Reuter): Japanese telecommunications giant Nippon Telegraph and Telephone Corp , virtually freed last week from strict governmental controls on its business, is gearing up to pursue Asian markets and multimedia services.

NTT president Junichiro Miyazu told Reuters yesterday that NTT would shift its investment target overseas, particularly to China and Southeast Asia.

He added that the company plans to invest in new multimedia- related services, moving away from domestic infrastructure projects.

"NTT has entered a new era," Miyazu said in an interview.

"We need to look more at Asian countries for investment now that we are allowed to enter the international market...and the construction of domestic basic telephone networks has almost been completed," Miyazu said.

The new projects may boost NTT's overall investment in the next few years, Miyazu said.

NTT, the world's largest telecoms company in terms of market capitalization, currently already spends a staggering two trillion yen (US$17.6 billion) a year in capital investment.

Japan last Friday changed its telecoms laws, including one governing NTT, in preparation for "Big Bang" deregulation reforms in the nation's lucrative telecommunications sector.

The Upper House of parliament passed a law to allow the telecoms titan to be split up into three units under a single holding firm in June 1999, paving the way for NTT to realize its long-held dream of entering the global market.

With Japan's Finance Ministry widely expected to resume the sale of NTT shares later this year for the first time in nine years, NTT is likely to enjoy more freedom in its management with less government control.

NTT, which was privatized in 1985, is still 65 percent owned by the government because the Finance Ministry suspended its offerings of NTT shares due to Japan's prolonged stock market doldrums in 1989.

"We will also need to focus more on profit and shareholder- orientated management," Miyazu said.

He also said that the company plans to announce in June next year its profit forecasts for after the restructuring, which is due to be completed in June 1999.

Asked if NTT was considering inviting outside directors to join the company, Miyazu said: "We have no plans for the time being."

However, he added that the firm would invite outside directors in the future. Asked whether this would happen at the time of the restructuring, he replied: "That would be well after restructuring."