INCREASING REGULATORY CAPACITY: THE ROLE OF THE REGION IN SHAPING NATIONAL ICT POLICY IN SOUTHERN AFRICA

Abstract

Since the 1990s regional economic communities (RECs) are increasingly developing model information and communication technology (ICT) policies and regulations in cooperation with semi-autonomous regional regulators’ associations (RRAs). As the capabilities of regional authorities such as the European Union (EU), Asia Pacific Economic Cooperation (APEC), and the Southern African Development Community (SADC) continue to grow, the level of influence on national ICT policy and regulation making is likely to increase.

This study investigates this influence of the region on national ICT policy and regulation making, with a particular focus on the role of the regional regulators’ association, which to date has gained little attention. To this extent, a model grounded in Levy & Spiller’s (1994) regulatory governance framework is developed and subsequently tested in the context of SADC in order to answer the following overarching research question:

How do regional economic communities (RECs) and their Regional Regulatory Associations (RRAs) influence national ICT policy and regulation in member states?

This research finds that SADC’s Communications Regulators’ Association of Southern Africa (CRASA) has two primary mechanisms of influence on national ICT policy and regulation making in its member states, namely through capacity building and policy lobbying. The learning processes that take place through these mechanisms can potentially lead to converging perspectives across the region about regulatory principles that in turn will be used in national regulation and policy making processes.

The study has shown Levy & Spiller’s (1994) framework to be a suitable framework for analyzing regional, as opposed to purely national, regulatory policy making. Further, by integrating concepts of governance structure and regulatory processes from the domains of public policy and organization science, together with the more formal approach of regulatory governance commonly taken by telecommunications policy scholars, side effects to regional regulatory governance are identified.

The study contributes both to new institutional economics research in the telecommunications policy realm, as well as the broader field of regionalization research. The study extends the domain of regionalization research, which is dominated by studies of the EU, to include a developing region. As such, the study has implications for resource-constrained regions that unlike the EU have the potential to play an important role in basic regulatory capacity building for both regulators and policy makers.

1.

Introduction

Information and communication technologies (ICTs) have been widely recognized to empower people and stimulate socio-economic development in developing countries (e.g. Courtright, 2004; Kenny, 2002; e.g. Wang, 2003). Hence, it is imperative that Africa’s level of ICT deployment is enhanced, as it continues to lag behind the vast majority of the rest of the world. Despite Africa’s fast growth in mobile telephony, that in 2001 led to Africa becoming the first continent in the world with more mobile telephony than fixed line telephony users^[1] , a wide gap in coverage particularly between urban and rural areas continues to persist (Allen, 2003; The Panos Institute, 2004).

One means for achieving this is implementation of appropriate policies and regulation, as they constitute a major driving force for market development (Gutierrez & Berg, 2000). However, even though policy and regulation are important channels through which the state can influence economic activity (Amann & Baer, 2005), in many developing countries policy and regulatory constraints continue to hamper deployment of innovative wireless ICT solutions (Galperin, 2005; Neto et al., 2005). This has often been blamed on policy makers protecting the incumbent operator at the expense of taking measures to stimulate competition and effective regulatory control (e.g. Gillwald, 2005; Horwitz & Currie, 2007), and thereby leaving little room for national regulators to implement effective regulation. As a collective of regulators^[2] , regional regulator associations (RRAs) have the potential to stimulate further liberalization and increase ICT connectivity, which indeed is one of the goals of the Southern African Development Community’s (SADC) regional regulatory association CRASA; the Communications Regulatory Association of Southern Africa.

1.1. The Role of Regions in ICT Policy & Regulation Making

Since the 1990s venues for regulatory policy making around the world have become increasingly diversified, transitioning from a predominantly national level to one that is multilateral and regional (supranational) (Cricelli et al., 1999; Drahos & Joseph, 1995; Kaiser & Prange, 2005; Wilson & Wong, 2003). This transition is due in part to the growth of regional^[3] economic communities (RECs) such as the European Union (EU), Asia-Pacific Economic Cooperation (APEC), the Southern African Development Community (SADC), and Association of Southeast Asian Nations (ASEAN). To the extent that these organizations serve as policy making bodies, they are likely to influence policy making activities at the national level. For example, as discussed by Majone (1996), in the EU between 1960 and 1990 the growth in the number of policies and regulations was nearly exponential and already in 1991 roughly three fourths of the laws implemented in France were made in consultation with regional authorities.

As regulatory policy makers, RECs ostensibly seek to resolve regional market failures through policy coordination, thereby facilitating the development of a more integrated regional market. In the ICT realm this can take the form of facilitating cross-border market entry by service providers and intra-regional trade in telecommunication equipment and services. Further, higher degrees of similarity in policies and regulation and predictability in the regulatory environment are expected to stimulate investment and therefore market development across member states.

These activities are increasingly pursued in conjunction with semi-independent regional regulators’ associations (RRAs), such as the APEC TEL Working Group (Telecommunications and Information Working Group), established in 1990; the ASEAN Telecommunications Regulators Council (ATRC), established in 1995; and the European Regulators Group (ERG), established in 2002. While RECs typically focus on the higher level policy aspects, these RRAs seek to provide models for regulation, which member states can use to shape the development of their national regulatory frameworks.

The presence of such bodies has implications at the global, regional and national levels and raises a variety of questions. Particularly, given RRAs’ explicit objective to “harmonize” policy and regulation across their respective regions, a question that needs to be answered is what, if any, effects do RECs and RRAs have on national level policy and regulation making in their member states? In other words, how do these RRAs influence national regulation and policy?

While significant research has been conducted by political scientists on how REC administrative institutions (i.e. directorates responsible for telecommunications policy making), and in particular the European Commission (EC), influence national telecommunication policy and regulation (see e.g. Bartle, 2005; see e.g. Humphreys & Simpson, 2005; Levi-Faur, 1999), the role of RRAs has gained limited attention. Furthermore, as pointed out for example by Hurrell (2005), theories developed in the highly integrated and comparatively wealthy EU may distort studies of other regions.

To this extent, this research aims to analyze the role of both REC and RRA in shaping national policy making in the context of the Southern African Development Community. A REC with one of the highest intra-regional income disparities, yet the first one in the African continent to set up an RRA that served as a model to other RECs in the continent including the West African Telecommunications Regulators Assembly (WATRA) and the Association of Regulators of Information and Communications for Eastern and Southern Africa (ARICEA), this case will generate insights potentially generalizable to other developing regions, and therefore has the potential to lead to new insights into the mechanisms of regional policy making in general.

1.2. Research Objectives and Research Questions

This study will analyze regional ICT policy making in SADC. SADC is an economic community comprised of the fourteen most southern countries of Africa, and together with CRASA aims to harmonize telecommunications policies and regulation across the region through the development of model telecommunications policies and regulations that are to be implemented across member states. Nevertheless, by trying to establish a common set of policies across jurisdictions, SADC faces enormous challenges because of the need to align a variety of stakeholders with competing goals as well as countries at different stages of economic development.

One of SADC’s primary goals has been to establish autonomous regulators across the region (McCormick, 2003). To this extent, main provisions of SADC’s Model Telecommunications Law included specifications concerning the licensing of operators and service providers, encouragement of an investor friendly environment, and privatization and liberalization of the telecommunications sector (Goulden, 2005). Regional models for deployment of new wireless technologies have consequently been developed, extending SADC’s focus  beyond fixed and mobile telephony services provision to include services provision through satellite and local wireless access networks as well (see TRASA, 2004). Currently, already 13 out of 14 member states have regulatory agencies in place. Additionally, throughout the region, private investments have increased, and significant growth in the mobile sector has been observed (Goulden, 2005).

Nevertheless, while significant activity regarding reform within the SADC region has been observed, the specific role SADC and CRASA have played in stimulating reform has yet to be systematically examined. Since SADC’s main goal to stimulate harmonization is the development of model policies that are to be (voluntarily) adopted across its member states, we need to gain insight in the mechanisms through which model policies are shaped and implemented, as well as whether and if so how, other mechanisms of influence are exerted. Therefore, the study aims to answer the following overarching research question:

RQ₀: How do regional economic communities (RECs) and their regional regulators’ associations (RRAs) influence national ICT policy and regulation in member states?

While the development of model policies and guidelines is stated as an important means to influence national ICT policy and regulation, SADC and CRASA may employ different mechanisms of influence as well. Further, as SADC and CRASA are primarily driven by their member states due to low numbers of staff at both the SADC and CRASA Secretariats, member states have an important role in shaping activity at SADC and CRASA. To this extent, the study aims to analyze how differences among member states influence activity at the regional level as well as how outputs from the regional level have potentially different effects in these member states with such varying backgrounds. Therefore, the following sub-questions will be answered in this study:

RQ₁: What different mechanisms of influence do RECs/RRAs employ to influence member states’ regulatory governance and regulatory incentives?

RQ₂: How do institutions and contexts of member states influence regional regulatory governance and incentives?

RQ₃: How do institutions and contexts of member states affect the influence of CRASA on national regulatory governance and incentives?

The study focuses particularly on what is considered the telecommunications side of ICT. As such, the study constitutes a telecommunications policy study. The study is interdisciplinary in nature, and draws upon research from other fields such as institutional economics, public policy, organization science and political science. The study should thus be read as spanning these disciplines.

1.3. Intellectual Merit and Broader Impacts to Society

This study contributes to the nascent literature on the role of regional economic communities and their influence on national level ICT policy making. In addition, the study will provide empirical insights into market development in Africa, a region that has received relatively limited attention in international telecommunications research so far.

The results will be of interest to the information sciences and telecommunications research communities both in the academic and governmental spheres, and academics concerned with international policy studies in general. Of particular interest to the information sciences and telecommunications research communities will be the insights generated into international mechanisms through which ICT policy implementation takes place, which is increasingly relevant across the globe. Drawing on the experience in Southern Africa, findings will be generalized where applicable to other regional experiences. In addition, this research can be seen as a sector specific case study of regional policy making that may provide insights to regional policy making in other sectors, such as the environmental and transportation sectors.

This study aims to contribute to practice through the development of recommendations to SADC as a regional body with regard to its institutional effectiveness by means of process management recommendations. In addition, policy makers from other regions and international organizations may find practical insights relevant to their own contexts.

[1] http://www.itu.int/AFRICA2004/media/mobile.html Last accessed August 1, 2007.

[2] In this study the term regulator typically refers to an organization, also known as national regulatory authority, as opposed to function (i.e. a person working at a regulator/regulatory authority could also be referred to as a regulator). When talking about staff of a regulator, this will be referred to in terms of e.g. manager of a regulator or councilor of a regulator, etc. The term RRA – regional regulators’ association – in turn thus refers to the collective, or association, of national regulatory authorities/regulators.

[3] Here ‘regional’ refers to supranational relations, whereas in other contexts ‘regional’ sometimes refers to the subnational level. For example, in the European Union the ‘Committee of Regions’ is made up of representatives of sub-national regions, and provides advice to the Commission, Parliament and Council of Ministers. Indeed, in discussing European integration Hooghe and Marks (L. Hooghe & Marks, 2001b) contrast the force of European integration with that of regionalization, meaning the increasing importance of sub-national governance.

INCREASING REGULATORY CAPACITY: THE ROLE OF THE REGION IN SHAPING NATIONAL ICT POLICY IN SOUTHERN AFRICA