tradepolicyreformsandpovertyinkenyaacasestudyof.docVIP

Trade Liberalization and Poverty in Kenya: A Case Study of the Telecommunications Sub-sector Prepared by Gloria Otieno and Eric M. Aligula Kenya Institute for Public Policy Research and Analysis (KIPPRA) Bishops Garden Towers, Bishops Road P .O Box 56445, Nairobi, Kenya June , 2006 Draft not for citation Paper prepared for the project “Linkages between Trade Development and Poverty Reduction”, implemented by CUTS International. Abstract Trade liberalization in the Kenyan Telecommunications sub sector began earnestly in 1997 when the government embarked on progressive liberalization and privatization within the sub-sector. Before liberalization of the sub-sector, services were delivered within a monopolistic public sector structure- the Kenya Posts and Telecommunications Corporation (KPTC); which combined regulatory and operational responsibilities (UNCATD, 2005), the sector was at the time plagued by inefficiencies poor coverage and low network coverage. The liberalization of the sub sector through the 1997 Communications Act led to splitting of the KPTC into Postal Corporation of Kenya, Telkom Kenya and the Communications Commission of Kenya, which is the regulating agency. Further reforms in the sub sector were as a result of Kenya fulfilling its obligations under the WTO framework. These have led to the development of the ICT policy, which entails reviewing of the policy framework for investment, competition and growth including obligation of investors to universal access as stipulated in the WTO reference paper on Basic Telecommunications. This study is intended to discuss the effects of Telecommunication liberalization on poverty in terms of employment generation, increase of Foreign Direct Investments, Access to services; and increase of opportunities due to access to information. The study involved desktop research combined with one on one interviews with key stakeholders in the sub sector including service providers and c