Perspectives on International Trade and Finance Assignment

Perspectives on International Trade and Finance - Assignment Example Joining WTO posed a vital influence on the political as well as economic reforms of China which were learnt to be influencing the telecom sector as well. Xiaolingtong is a mobile network which was developed in the year 1999, before China joined WTO and was controlled by the Ministry of Information Industry (MII) which was considered to be the backbone of the fixed line service providers. Later on, significant developments were made with regard to Xiaolingtong which assisted in capturing a significant share in the foreign market. The government provided full support towards the development of Xiaolingtong but those developments were not regarded as vital in comparison to the mobile or cellular service providers. There were also few issues which existed in relation to the adoption or implementation of the 3G service in China’s telecommunication services which required the involvement of different services and technologies. Discussion Key Issues or Options or Alternatives There a re few issues which are known to prevail or subsist in the telecommunication system of China and these issues are believed to be preventing the overall development of the system. The telecom market in China was characterized with arbitrary pricing as well as promotion policies. The main focus was to gain a significant market share instead of increasing its market size by providing new and valued services. The telecom market or the sector was observed to provide increased focus on deploying various services without being much concerned regarding the underlying quality with respect to the value added services for creating differentiation or competitive advantage for their products in the international market. There was an existence of high regulatory framework which created uncertainty as well as risk for the 3G mobile services. China’s telecom policies lacked a proper implementation of the relevant laws as well as regulations. It was found in this respect that MII played a maj or role in regulating the policies for the telecom system in China as the policies were not considered to be transparent which led to uncertainties. It was identified that to develop an efficient as well as effective competition in the telecom market, the existence of an ‘Independent Telecom Regulatory Authority’ was highly required. When China joined WTO, it should have then established an ‘Independent Telecom Regulatory Authority’ for the purpose of developing its telecom industry, but failed to do as MII used to formulate plans and policies as along with managing the telecom service providers (International Trade Administration, 2010). The telecom industry of China needed to conduct its business in partnership with some other international telecom services to compete in the international market. The firms formed out of Chinese partnerships with the foreign associates usually remained stated owned and lacked adequate experience in terms of competing in th e international market. The telecom equipment requires qualifying through various certifications as well as testing prior to their implementation and installation. A certain degree of limitation is imposed in China with regard to the aspect of foreign investment which restricts foreign companies to exercise control over the management of the Chinese telecom industry. A WTO obligation