Sequencing in telecommunications reform: A review of the Turkish case

This paper reviews the Turkish case of telecommunications reform with reference to the evidence from the sequencing literature. Turkey’s progress is in line with the proper sequencing of reform suggested by the literature. Accordingly, Turkey has pursued a gradualist approach by restructuring its public utility, the Posts, Telegraph and Telephone Company, and creating Turk Telecom in 1994; establishing the sector regulator, the Turkish Telecommunications Authority, in 2000; and liberalising the sector in 2003 before selling 55% of Turk Telecom to Oger Telecom, a private company, in 2005. Although the proper sequencing of reform was implemented, the Turkish telecommunications sector has not been functioning satisfactorily as yet, as indicated in the recent progress report of the European Union about Turkey’s accession and as revealed by the performance indicators analysed in this paper. The prevailing information, incentive and commitment problems require a close cooperation by the government with the regulators so as to ensure and reinforce the autonomy of the Telecommunications Authority and to establish a more transparent decision-making process.