Socio-economic benefits of ICT diffusion and its significance for trade and development

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1 Socio-economic benefits of ICT diffusion and its significance for trade and development Presentation at WTO Symposium on 15th Anniversary of the ITA Geneva, 14 May 2012 Torbjörn Fredriksson Chief, ICT Analysis Section UNCTAD 1

2 The Evolving ICT Landscape (1) Mobiles preferred ICT tool among small businesses Mobile subscriptions per 100 inhabitants, by country group, Source: ITU

3 The Evolving ICT Landscape (2) New forms of mobile use Text messaging (SMS) Mobile money Expanding especially in Africa Only 5 systems in the EU* Mobile Internet Smartphone sales surging Africa: 84m mobiles already Internet-enabled China: 12% of Internet users go on-line via the mobile India: >250m mobile data users Mobile broadband Mobile money deployments, (number of deployments) 3 * Austria, Belgium, Germany (Mpass), Portugal, UK Sources: UNCTAD, GSMA, ITU, national data, Gartner, J.M. Ledgard.

4 The Evolving ICT Landscape (3) Broadband divides Average download speeds, selected economies, 2010 (Mbps) Penetration gap < 1m fixed broadband subscriptions in LDCs Person in developed country almost 300 times more likely to have access to fixed broadband than a person in an LDC Different speed Price differences 4 Sources: UNCTAD, Ookla, ITU.

5 The Evolving ICT Landscape (4) Broadband applications Voice over Internet Protocol (VoIP) Cost-effective Expanding fast Restricted in some countries Social media Cost-effective alternative to traditional websites Tool for consumer interaction Mobile versions require less bandwidth Global subscriptions of VoIP, Q Q (millions) 5 Sources: UNCTAD, ITU, Point Topic.

6 Four Facets of the Interface between ICT and Private Sector Development 6 Source: UNCTAD.

7 7 ICT Production a Key Part of the Private Sector A vibrant ICT sector contributes to PSD Creates productive jobs, generates export revenue, spurs innovation Supports ICT use throughout the economy and society Growing importance in many developing countries 24% of Kenya s GDP growth in the past decade Cameroon: ICT sector grew between 15% and 46% per year ( ); 60,000 formal and 200,000 informal jobs India: ICT sector s share of GDP up from 3.4% (2001) to 5.9% (2008) New opportunities arising for low-income countries Mobile sector informal and formal enterprises >10 million jobs, most of which in airtime distribution Outsourcing (and crowd-sourcing) of micro-work Source: UNCTAD, World Bank, Orbicom.

8 Mobile Sector Employment, Selected Economies 8

9 Case Amazon Mechanical Turk In 2008, 76% of microworkers in US, 8% India In 2010, 47% in US, 34% in India, remaining 19% in 66 (!) other countries Crowd-sourcing of Micro-work a new form of more inclusive outsourcing Hours worked by week via the ODesk platform 9 Source: UNCTAD, World Bank and ODesk.

10 Freelancers in Bangladesh 10,000 freelancers active online Most service clients in US or Europe Provide a range of services over the web Software development Graphic design Social media marketing, etc New Central Bank Directive (2011): Revenue should be treated as export-related commercial income rather than as remittances 10 Source: UNCTAD, BASIS and ITC.

11 Mobile phones and dairy farmers in Bhutan 98 per cent of population (690,000) live in rural areas Mobiles : from 5 to 55 subscriptions/100 people Now supporting dairy farmers Access to market and price information Avoid intermediaries deal directly with customers Increased direct sales, less waiting time Improved communications Mobiles are affordable Government launched mobile info system 4 languages New employment has been created Support to livelihood of poor farmers 11

12 12 Composition of ICT Sector Varies Telecommunications dominate in most developing countries

13 Exports of ICT Goods Mainly from Asia LAC 3.8% Africa 0.2% Other economies 0.1% Developed countries 32.6% Exports of laptops and other portable processing devices grew from $25 billion to $125 billion between 2000 and 2010 Other developing Asia 36.6% China 26.7% China in 2010 became world s largest exporter and importer of ICT goods 2010 data 13 Source: UNCTAD based on Comtrade.

14 Opportunities and Implications New ICT landscape opens for more inclusive development Key areas within ICT sector: Mobile sector Software growing local demand, new export channels Outsourcing/crowdsourcing ICT-enabled services It takes more than infrastructure Need for comprehensive strategies address the four facets to reap full development benefit from ICTs Move from supply to demand-driven interventions Leverage partnerships with private sector and civil society Better data needed especially in services 14

15 Thank You! The Information Economy Report 2011 can be downloaded free of charge at 15

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