TNAG-1779-FCO40-2539-Hong-Kong-international-telecommunications-1988 — Page 161

2.5

However such comments are to be expected during a process of transition to competition.

TARIFFS

Hong Kong is very competitive in relation to most aspects of local telecommunications tariffs. It is, for example, one of the largest local call areas in the world in which all local calls are free (see Exhibits 2.18 and 2.19). In comparison with the Philippines, Japan and Singapore the annual rental charges for residential and business lines are lower in Hong Kong.

In real terms business and residential telephone line rentals are now 65% and 60% of their 1976 levels. Tariffs have fallen on average by 4.3% p.a. in real terms (see Exhibit 2.20).

IDD call charges from Hong Kong are both lower and higher than from other destinations. In general call charges are lower from Hong Kong than from Japan but they are higher than from Australia and Singapore. Singapore is pursuing an active policy of rate reductions in order to attract regional voice and data traffic. In January 1987 Singapore made tariff cuts of 12% to 17% bringing its rates down below those of Hong Kong as shown below in the table labelled "International Rate Comparisons" below.

This table shows that CWHK's Hong Kong to London IDD rates are lower than BTI's rates in the other direction, but higher than Mercury's IDD rates from London to Hong Kong. They are also higher than the IDD rates from Sydney to London (by 50%). CWHK IDD rates from Hong Kong to New York are lower than AT&T's and MCI's rates but are significantly higher than equivalent rates from Sydney to New York (by 75%). While CWHK's rates for private voice half circuits from Hong Kong to London are lower than those of BTI in the other direction, they are 15% higher than Mercury's private London to Hong Kong half circuit rates.

INTERNATIONAL RATE COMPARISONS (US$)

Route

Carrier

Peak Period 3-Minute IDD Call

Private Analogue

1/2 Circuit

HK

Ada

LONDON

CWHK

4.04a

46K p.a.

HK - N.Y.

CWHK

4.73b

46K p.a.

LONDON HK

BTI

4.70

53K p.a.

MERCURY

3.87

40K p.a.

-

HK

ATT

MCI

N.Y.

a. To London from Sydney b. To New York from Sydney

-

Source: Published tariff rates

2.70; from Singapore

6.32

72K p.a.

6.00

61K p.a.

- 2.70; from Singapore

-

3.83 5.01

-

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