Information Communications Technology for Development
Connectivity—whether the Internet or mobile phones—is increasingly bringing market information, financial services, health services—to remote areas, and is helping to change people’s lives in unprecedented ways.
New information and communications technologies (ICT), in particular high-speed internet, are changing the way companies do business, transforming public service delivery and democratizing innovation. With 10 percent increase in high speed Internet connections, economic growth increases by 1.3 percent.
“The mobile platform is emerging as the single most powerful way to extend economic opportunities and key services to millions of people,” says Christine Zhen-Wei Qiang, World Bank economist and editor of a new Bank Group report on information technology and development, Information and Communications for Development 2009: Extending Reach and Increasing Impact.
Zhen-Wei Qiang was online Tuesday, July 28 and answered your questions on information communications technologies.
Further, is the ratio of increase in high speed internet connection and economic growth same for rural and urban economics?
ICT provides economic opportunities to both urban and rural populations. One common contribution is that it increases productivity and makes the market work more efficiently, although the magnitude of the impact on economic growth is likely to be different. The fact that virtually all new mobile customers in the coming years will be in developing countries, and more specifically in rural areas, means that the ICT platform is reaching population with low levels of income and literacy.
As a result, ICT is becoming the largest distribution platform of providing public and private services to millions of people in rural and poor areas. Market information, financial services, education and health services had largely been unavailable in those areas in the past due to lack of connectivity of any kind. Now the wireless platform is promoting NEW economic and social opportunities at all levels for the poor population.
Besides the limitations of existing telecom infrastructure in developing countries, the principal constraints in adopting and using ICT applications, especially for small businesses, include lack of capacity to assess returns and costs of using ICT, and a shortage of and inability to retain ICT-skilled labor. In some countries, business associations assist with needs assessment for businesses to invest in ICT (note that not all of them would benefit from using ICT), advise them on technology choice, and provide common business applications (e.g. HR, accounting) at low cost to small businesses. Some governments offer support of training and skills development.
Low-income countries which have implemented deep sector reforms supported by the Bank Group generated some US$16 billion in investment between 1997 and 2006. Some US$20 million in output-based aid in Nepal, Nicaragua, Nigeria and Uganda provided access to 3,356 remote localities, serving over 7.8 million people.
In addition, IFC, the private arm of the Bank Group, has also been financing US$1.5 billion and mobilizing another US$330 million for 84 ICT projects to date in 32 low-income countries (mainly for the extension of mobile and data networks).
The World Bank has been working closely with about 30 countries in Sub-Saharan Africa to strengthen regulatory frameworks, build regulatory capacities, and address rural access. Reforms implemented since 2000 have unleashed competitive forces in the sector, particularly in the mobile market. The result has been unprecedented increase in investment: total telecom investment in the region between 2000 and 2007 reached $20 billion. Africa is the fastest growing region in the global cellular market: the number of mobile subscribers increased from 2 million in 2000 to over 150 million in 2007.
From 2005, public-private partnerships for regional connectivity have been recognized as a powerful vehicle to push down the cost of international bandwidth and increase the affordability of high-speed internet. Examples of such partnerships are the on-going IFC-supported Eastern Africa Submarine System (EASSy) and the Bank’s Regional Communications Infrastructure Program (RCIP).
Together, EASSy and RCIP have triggered a race for connectivity in Eastern and Southern Africa with prices set to decrease five-fold or more. Part of the approach is being replicated for Central and Western Africa. Other ways to push prices down are to lower taxes and termination fees. Any incremental efforts to lower prices would have a tremendous impact on affordability and hence access.
For more information, visit RCIP's website.
As I said in my answer to Matt, the World Bank Group has been working closely with over 30 countries in Sub-Saharan Africa to improve ICT connectivity. At the same time, we have also launched projects and programs that develop e-government applications and IT-enabled service industry.
To take Ghana as a specific example, the country is on the cusp of a breakthrough in improving internet connectivity. The establishment of a National Communications Backbone Company Limited to develop a robust national fiber infrastructure, and the approval of cable landing rights for at least two companies to compete with the SAT-3 cable, should soon provide most Ghanaians with more affordable and reliable high speed internet connectivity.
Separately, the World Bank launched a US$40 million project called e-Ghana in 2006, which aims to provide support for improving Ghana’s competitiveness in the IT/IT-enabled services industries, including Business Process Outsourcing (BPO), as well as support for enhancing public service delivery through e-government. Activities under this project include setting up a high-speed, government-wide communications network connecting key ministries, departments and agencies; establishing a shared portal infrastructure for key agencies; and developing electronic applications for the priority revenue-generating agencies in the country.
How does the Bank plan to assist countries particularly in sub-Saharan Africa in developing their capacity towards ICT service trade at national and international level? What concrete measures are being taken to see that sub-Saharan Africa becomes competitive in this area?
In 2007, the World Bank conducted a series of studies and capacity building on ICT-related service trade for Eastern and Southern African countries (Trade in Information and Communication Services: Opportunities for East and Southern Africa, available on our website’s publications’ page). The study found that some of the critical elements necessary for successful ICT trade (“ICT-competitiveness”) are not sufficient. These elements include network infrastructure; an enabling policy, legal and regulatory framework environment; the education and training required to have a labor force with necessary ICT skills; use of ICT applications by businesses and government; and consumer awareness.
The Bank is following up on this analytical work with projects in Ghana, Kenya, Nigeria and Rwanda to facilitate trade in ICT business, particularly in business process outsourcing (BPO). These projects include, among other things, support to industry associations, development of IT Parks, partnerships with the industry to take up training of manpower, and support to investment promotion activities. More countries are likely to be added based on readiness of interested countries and effectiveness of these earlier programs.
What is the World Bank doing in terms of educating the population on the potentials of ICT in development and in reducing poverty in Africa especially Sub Saharan Africa where i come from?
To be more specific, What kind of training is the Bank offering to the youths who contribute the highest work force and the most vulnerable in Sub-Saharan Africa on ICTs?
2. What are the conditions of the application of the ratio of 10% increase in high speed internet connection, 1.3% increase in economic growth ?
Thank you very much.
Whether this great potential to contribute to growth is realized will also depend on whether governments understand the opportunity and ensure that supportive conditions (e.g. providing high-capacity connectivity) are in place through regulatory and policy reforms as well as strategic investments and public-private partnerships. Realizing the benefits of the Internet requires development of new content, services, and applications.
We will have the next issue of IC4D report in 2011 or 2012. We would like to drill deeper on (a) broadband policies and sustainable public-private partnership models; and (b) mobile applications for sectoral development (e.g. m-banking, education, health, agriculture/market information, social networking, etc), in terms of the regulatory guidance as well as practical operational guide involving government, telecom operators, application developers and mobile users.
This is not to say that the risk of "digital divide" does not exist. Especially as we move from simple voice and text messaging to more complex services and applications, the potential to benefit from ICT depends on factors (as I mentioned in my response to Malak) where developed countries have comparative advantages. But ICT offers leapfrogging possibilities and new opportunities at all levels. So let's work together to maximize its development impact, especially in low-income countries.
Graph: Growth Effects of Telecommunications
Well, that's all the time we have today. Thank you so much for your great questions, and for your interest in the Bank's work in ICT. If you haven't already, please visit the IC4D website.