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Telecommunications
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Sector overview
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Since the end of the war, establishing wireless networks has been the initial priority in upgrading Iraq's telecom networks. But further progress in the Iraqi economy will necessitate rebuilding and expanding the wire-line network. The Coalition Provisional Authority (CPA) and the interim government agencies acknowledge the benefits of telecommunications networks in assisting commerce and in restoring other infrastructure, such as electric power, and transportation.
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The goals of rebuilding and expanding Iraq's telecom infrastructure pose unique challenges and opportunities, some resulting from the war and some from decades of neglect before the war. At year-end 2002, Iraq's wire-line telecom infrastructure was in the bottom 25% of world economies in terms of "teledensity," or the number of main lines per population - a critical indicator for assessing a country's telecom networks.
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Iraq is among the Middle East's weakest telecom markets, with only 3 lines per 100 population, comparable to the world's poorest developing economies in Africa, Latin America, and Asia. The average for the Middle East region is 13 lines per 100 population, and Iraq's neighbours all have stronger telecom networks: Iran has 19 lines per 100, Saudi Arabia has 14, Syria has 12, and Turkey has 28. (These data are from the International Telecommunications Union.)
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This puts Iraq in the position of other developing economies - needing to catch up quickly but able to deploy the latest technology. Since the war, Iraq has taken the step of other countries in this position - relied on wireless technology for a rapid increase in lines. Three cellular licenses were awarded in 2003, and the third operator has completed its initial construction and started service in early 2004. Also in 2003, Lucent began work on a $25 million contract to replace switches in Baghdad. Looking ahead, there is opportunity for more switches, inter-office trunks, and complete wireline infrastructure - all needed to support voice, data, Internet, and other communications.
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