1. 1 China Country Report FINAL INTERNATIONAL WORKSHOP ON RURAL ICT DEVELOPMENT Regulatory Framework

2. 2 Policies and regulations In September 2000, Telecommunications regulation of the People's Republic of China was enacted. Term 44 stipulates: Telecom service operators must fulfill the telecom universal service obligations according to related national regulations. The management approach of cost compensation for the telecom universal service. The approach should be decided by the State Council's information industry authority coupled with the State Council's financial department and price department. The approach will be enacted as soon as the State Council approves it. The Telecommunications Regulation is a legal basis and guideline for the telecom universal service.

3. 3 Policies and regulations In November 2001, the state council of the People's Republic of China issued the Plan of Telecom System Reform. The plan stipulates to set up the universal service fund as soon as possible. All telecom operators should undertake the universal service, promote the transformation of telecom universal service mechanism and ensure the telecom universal service in the market economy. After that, the former Ministry of Information and Industry (which has been reorganized as Ministry of Industry and Information Technology) coupled with the Ministry of Finance and other ministries began to make a plan on building the telecom universal service in China and prepare to set up a new system for the universal service in the future with the universal service fund as the core. Plan of Telecom System Reform is the first time the State Council formally points to build the telecom universal service fund in an official document.

4. 4 Goals of Chinas rural telecom universal service in different phases Chinese administrative establishment system is up to the State Council and down to administrative villages; there are several levels between them. Their relations are shown as follows: The State Councilprovince (31)city (333)county (2861)town (44067) administrative village (700 000. ) *Each administrative village is composed of one village or several villages ( Taiwan province, HK and Macau special administrative regions are not included.) Chinese administrative establishment system

5. 5 Goals of Chinas rural telecom universal service in different phases Phase one: The countryside in China has access to the telephone service until 1997; Phase two: Extend network to villages until 2004; Phase three: Help administrative villages have access to phones from 2004 to the end of 2007; Phase four: Help villages have access to phones and towns have access to the Internet from 2008 to the end of 2010; Phase five: In the future, promote information technologies in the country.

6. 6 Goals of Chinas rural telecom universal service in different phases MIIT set the objective of rural telecom universal service for 2011: 1. 83% of administrative villages have broadband The number of administrative villages which have broadband access added nearly 17,000, the penetration of administrative villages with broadband access increase from 80% to 83%. 2. 94.5% of villages have phones The number of villages which have at least 20 households have phones added nearly 10,000, the penetration of villages which have at least 20 households have phones increase to 94.5%. 3. Information activities in the countryside expand to 70% of the towns 95% of the towns in the eastern provinces, 80% of the towns in central provinces, 60% of the towns in western provinces, to achieve "one village has one information service station, one village has one information service point, one village has one online repository, one village has one online agricultural information column According to the new twelve five-year plan

7. 7 Work initiatives of Chinas rural telecom universal (A) Cosidering the local conditions to bulid broadband network of administrative villages. Using the XDSL, WLAN, 3G technologies to launch broadband in the proper way. (B) Steady progress in the villages telephone network coverage. Considering the geographical and economic conditions of the villages have at least 20 households, the priority for the villages there are roads and electricity. Emphasis on the telecom coverage of key rural areas. For example, along the traffic arteries. Work initiatives on the target:

8. 8 Work initiatives of Chinas rural telecom universal (C) Actively carry out information activities in the countryside. Full use of the telecommunications business information services in rural agriculture-related Internet sites and other sites on the Internet pages set up towns and villages information section, give publicity to the local agricultural products, tourism, trade, resource development. (D) strengthening the effectiveness of rural integrated information service platform. Increase the collaboration of information service providers, technology developers, agriculture-related departments; increase the channels to collect the information.. Work initiatives on the target:

9. 9 Work initiatives of Chinas rural telecom universal (E) Implementation of preferential policies to villagers, ensure villagers can affor d the communication consumption. (F) Attempt to create a long-term multi-channel investment in the telecommuni cations universal service mechanism. First, the Ministry will actively cooperate with national authorities to accelerate and promote the establishment of the tele communications universal service fund; Second, provinces Communications Ad ministration establishment of local investment in the telecommunications unive rsal service mechanisms; Third, all telecommunications companies to further in crease investment in communication village project. Work initiatives on the target:

10. 10 China Academy of Telecom. Research, MIIT. Teleinfo institute Tel 86-10-62301302 86-10-62301730 Fax 86-10-62304136 Email teleinfo@catr.com.cn teleinfo@catr.com.cn Thank you!