Survey of Investor Perceptions and the Broadband Sector (2020)
The Legal Transition Team has carried out regular assessments of the telecommunications/ICT sector in its countries of operation. These assessments have focused on the overall potential of the sector for reforms that could improve the broader investment climate in the sector, in particular, to improve the reach, quality and affordability of infrastructure for delivering modern broadband services. The previous assessment approach used by EBRD has been to study key characteristics of the market, in terms of output metrics (for example broadband penetration, eGovernment and eCommerce world rankings) alongside a comparison between the legal and regulatory framework and best practice in the sector. The methodology relied on building an accurate picture from the outputs of the sector itself alongside on the policy, legal and regulatory environment for investors, service providers and consumers.
Taking an investor’s view
For 2020, we have taken a different approach, one in which the informed views of investors has the most impact. Specifically, we have recorded directly the views of a wide range of existing and potential stakeholders in investment in broadband infrastructure and service, including finance providers, telecommunications network and service operators, broadband and internet service providers, analysts and other market stakeholders.
“Broadband investment” embraces telecommunications infrastructure and connectivity (fixed and mobile networks) and the services (both retail and wholesale) that are delivered over these networks (voice, internet, data, media and broadband services). This definition is used within the context of the key purpose of this survey – to promote broadband infrastructure investments.
In addition, the survey team has researched and held wider discussions regarding the overall policy, legal and regulatory conditions used by the relevant authorities in each country. In this way, we have attempted to match the effectiveness of the relevant conditions in each country to investor needs.
Stakeholders generally use benchmarks to compare the conditions in their country alongside the conditions achieved in neighbouring countries and regions, notably the EU. The EU is generally perceived to be an open and effective marketplace for ICT investments. The EU’s current legal and regulatory framework (“The European Electronic Communications Code”) is viewed by investors as an enabler to overcome the most commonly faced problems in the competitive ICT markets.
Other factors are used in our surveys that could be useful to investors in deciding on which countries to focus on now and in the future. The most important of these other factors are the relative achievements, expressed in terms of each country’s current standing in published world rankings. For example, the International Telecommunications Union (ITU’s) ICT Development Index and world rankings are used alongside their published data for fixed and mobile broadband penetration and internet usage.
Respondents’ views of the policy, legal and regulatory enablers for broadband infrastructure investment have led us to identify the gaps in policy implementation. The action areas we recommend for each country are shown toward the end of the report.
The approach is based on investors’ immediate concerns in terms of which factors in each country contribute most to decisions on whether to invest or not. The results have therefore identified the countries that have the most attractive markets and policies for encouraging investment, particularly for broadband infrastructure and connectivity. The survey outputs, in the form of a ranking of investment attractiveness and a listing of the key investment risk factors, are intended not only to inform investors, but also to prompt policy makers to consider reforms that would improve investment conditions in their countries.
The main output of the survey is a ranking of countries, based on their investment attractiveness, with further explanations for each country giving the main reasons expressed by investors that have led to the index and ranking calculated.
Countries included in the survey
The countries we intend to include in the 2020 survey are:
- From the Southern and eastern Mediterranean (SEMED) region: Egypt, Jordan, Lebanon, Morocco and Tunisia
- From the South eastern European countries (SEE) region: Albania, Bosnia and Herzegovina, Croatia, Kosovo, Montenegro, North Macedonia and Serbia
- From the Eastern Europe and the Caucasus (EEC) region: Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine
- From the Central Asia region: Kazakhstan, Kyrgyz Republic, Mongolia, Uzbekistan
The reports from the SEMED and SEE regions can be found below, on an individual country basis and contained in two regional reports.
Reports from the other regions will follow in due course.