In February 1997, sixty-nine governmentsof high-income and developing countries agreed to liberalizetheir basic telecommunications services under an agreementnegotiated through the World Trade Organization. Mostparticipants in the agreement have subscribed toprocompetitive regulatory principles, including independentregulators, competitive safeguards, measures to ensureinterconnection, universal service obligations, andtransparent and nondiscriminatory practices in licensing.The markets affected by the arrangement represent more than90 percent of the world market for telecommunications. Theauthor reviews the evolution of the agreement and arguesthat the critical issues now are ensuring the quality ofimplementation and setting up a procompetitive regulatory environment.