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. Last Updated: 07/27/2016

Trade Chiefs Hope to Seal Global Telecom Pact

KOBE, Japan -- Trade chiefs from four major economic powers began biannual talks here Friday but prospects were cloudy on their main challenge -- making headway on a pact to open up the world's telecommunications market.


The trade ministers gathered in the Japanese port city of Kobe, an international trading hub devastated by an earthquake a year ago, ahead of an April 30 deadline for forging a global telecommunications pact.


Sealing such an accord would mean cheaper phone calls and lower business costs as a result of more competition in the $513 billion world telecommunications market.


"It is a key time for trying to make a final push forward in basic telecom negotiations, which should end on April 30," Ira Shapiro, general counsel to the U.S. Trade Representative's office, told a meeting of business executives.


European Union Trade Commissioner Sir Leon Brittan said a failure on telecommunications would cast a "deep shadow" over the weekend's so-called Quadrilateral trade talks, which will cover a broad agenda.


But with the United States urging its Quad partners to make better offers on how far they will open their markets to foreign investment and competition, and fingers pointing at Canada as one culprit, it was doubtful how much progress could be made.


In the corporate world, two giant telecommunications mergers were in the works Friday.


American firms Bell Atlantic Corp. and Nynex Corp. are close to agreement on a $23 billion merger between the two telephone giants and board members may vote on a plan as early as Monday, according to two sources close to the discussions.


Separately, a ?35 billion ($53 billion) merger between British Telecom and Cable & Wireless appeared increasingly likely Friday as sources close to the talks said executives from the two groups were now in frequent contact.


But the sources countered market speculation that a deal was only days away, repeating that a number of unspecified issues could still scuttle the ?35 billion ($53 billion) deal.


"Contacts have been going on between the groups at various levels for some days. But this is more a natural evolution than a shift of gear," one said.


The next step -- possibly within two to three weeks -- will be a joint statement from the two companies announcing either the termination of talks or an agreement in principle to merge.