ICT and economic growth

by david.nunes
Harri KoponenIssue:Africa and the Middle East 2007
Article no.:8
Topic:ICT and economic growth
Author:Harri Koponen
Title:CEO & GM
Organisation:Wataniya Telecom
PDF size:216KB

About author

Harri Koponen is the CEO and General Manager of Wataniya Telecom. Dr Koponen came to Wataniya Telecom with extensive telecommunications experience. He served as the President and CEO of Sonera Corporation, Deputy CEO at TeliaSonera, Executive Vice President and General Manager of Ericsson North Americaís Consumer Product Division, as global account executive at Ericsson for Vodafone, and spent a period leading the SonyEricsson business North American Market Unit. Prior to this, Dr Koponen was the Head of HPís telecom Sales Division and Office manager at Ov Shell AB. Dr Koponen holds a PhD in Economics.

Article abstract

The Middle Eastís future depends upon its people taking part in the global information economy. This calls for long-term commitments from regional governments to educate their youth and create an ICT infrastructure so they can compete in the worldís marketplaces. Kuwaitís E-Government Action Plan, Saudi Arabiaís Home Computing Initiative, Egyptís PC for Every Home initiative, Iranís National ICT Agenda and ict Qatar are all examples of programmes designed to help the Middle East became part of the information economy.

Full Article

ICT in the Middle East can impact economic growth in the region by bringing a wide range of industries, institutions, as well as its workforce, onto an equal footing with leading global economies. ICT is steadily increasing its role as a key propagator of growth in the world economy. It will have far-reaching consequences for the Middle Eastís economic growth by bolstering productivity, efficiency and increasing overall GDP. In order for the region to reap such economic benefits, a comprehensive and wide-ranging strategy on both regional and national levels that promotes ICT development through education and training is essential. Such a strategy would ensure the creation of a skilled work force and a knowledge-based society that can actively contribute to the regionís economy and participate in a world arena that is becoming increasingly dependent on such skills. Although the implementation of such strategies in the region is currently far from holistic in its approach, some governments are aggressively pursuing and investing in national ICT development plans in different forms. Kuwaitís E-Government Action Plan, Saudi Arabiaís Home Computing Initiative, the PC for Every Home initiative in Egypt and the National ICT Agenda in Iran, are all examples of governmental efforts to increase their nationsí ICT competency while developing their infrastructure. Kuwait, for example, recently signed a Strategic Partnership Agreement to expand the use of ICT to further a knowledge-driven economy and help support Kuwaitís E-government initiatives. Speaking after the signing of the deal in Kuwait City, Microsoft CEO Steve Ballmer said, ìTo compete successfully in the global marketplace, countries must invest in building a workforce that has the right technical skills and knowledge. We welcome the opportunity to work with governments like Kuwait that are using information technology to foster a knowledge-based economy – providing new jobs and new opportunities for its citizens.î Similarly, a Memorandum of Understanding signed with ict Qatar in line with the countryís strategy to realise its ambitions of becoming a top knowledge-based society, points to the concrete steps being taken to capitalize on ICTís potential. This will transform Middle East economies by providing opportunities and skills that are valid in the global market as well as locally and regionally, and will develop an ICT infrastructure that can handle the requirements of todayís world. Those examples point to how ICT in the Middle East could have a massive impact, significantly improving and alleviating problems. These programmes will help meet the needs and aspirations of several of the regionís nations to become financial hubs, by improving the quality of state-run education, facilitating regional and international trade and fostering manufacturing and logistics by providing more easily accessible information. This can help raise the profile and productivity of small- and medium-sized enterprises, SMEs. Whatís more, ICT may also hold the key to increasing economic efficiency in the region through the use of secure, more comprehensive, national and region-wide systems in the e-government sector that would eliminate the largely porous and disassociated networks that are not significantly more efficient than the filing cabinet and rubber-stamp systems. The World Economic Forum on the Middle East 2006 Business Agenda stated, ìThe worldís greatest economies are led by businesses. Although the Middle East and North Africa, MENA, countries face enormous obstacles to self-sustaining growth, businesses can play a greater role in promoting reform and global competitiveness. In this regard, ICT could be the magic solution enable businesses to flourish and prosper in the region. It needs to be aligned, through government support, with a fast-track programme to develop, implement and rapidly adopt ICT. That would pave the way for public as well as private sector success. However, the seeds of change – and hope – are being planted wherever countries have recognised the vital role of ICT in businessesí prosperity, and have embraced reforms that have accelerated economic growth Moreover, ICT can impact the regionís economic growth by bridging the digital divide – by giving people access to ICT so they can empower themselves. While the digital divide is first and foremost a social issue, narrowing the split through education and investment also increases productivity and gives poorer segments of society the tools needed to participate in the global market and the information society. Big businesses in the region, such as the banking, telecommunications and transport industries for example, are offering their customers an advanced array of online services, and online merchants benefit as a consequence of these activities. ICT will help achieve efficient economic growth with the help of government-implemented regulations that stimulate citizens to use the Internet and become e-citizens and, in turn, e-consumers. More importantly, increased ICT development in the region will contribute to the creation of a wide base of skilled local labour forces capable of participating and actively contributing to a more sustainable economy. With statistics on Middle East Internet usage, according to Internet World Stats, IWS, estimated at ten per cent of the regionís population, maximizing economic growth potential needs to start at the grass-roots level. Governments need to invest heavily in basic IT training and conditioning for all public school children from an early age. Follow up programmes, with relevant and up-to-date courses, should be subsidised and incentive-driven for higher education. With Internet penetration rates, according to IWS, of 0.1 per cent in Iraq, 1.0 per cent in Yemen, 10.6 per cent in Saudi Arabia, 25.6 per cent in Kuwait and a maximum of 35.1 per cent in the UAE, it is clear that while countries with higher Internet penetration rates are wealthier, a lack of educational facilities and programmes providing computers and Internet access for the poorer sectors of society will result in their inability to operate in an ICT dominated world, and the alienation of vast sections of Middle East society. Egyptís Boraq for Electronic Industries, BEI, is the first and only computer-manufacturing facility in the Middle East. It provides the tools necessary for the widespread integration of the regionís non-connected populace by making technology more accessible. This project is a perfect example of the kinds of solutions needed to help bridge the digital divide. The development of more Arabic-language content and communities on the Internet is important to overcome the language barrier to Internet usage and promote full inclusion of the regionís population. Online sites like Maktoob.com, that was recently awarded the ëInformation and Knowledge Portal of the Yearí award at the 12th Middle East ICT Excellence Awards in Dubai, is a leading example of the power of investing in comprehensive online content in Arabic, and providing an incentive for Arabic-speaking individuals to be connected to the World Wide Web. With over four million subscribers, the site is yet another example of the impact ICT can have on economic growth in the region. International corporations, NGOs and other organizations can all make major contributions, empowering populations by providing the tools and training needed to use ICT as a medium for social and economic advancement. Nothing, however, can out-perform the training of the population from an early age, when schooling is compulsory, and putting ICT on the same level as basic skills such as language and mathematics. This way, the countries in the region will ensure that all the coming generations will be ready to take advantage of the benefits of ICT and participate actively in its development, implementation and management. Today, the Middle East depends on the importation of most things, including the very ICT technology and expertise it is implementing. An aggressive ICT educational policy is the key to nationalising the industries and making them self-sufficient. This will maximise the regionís returns on investment by creating large employment demands that can be filled by the very citizens they aim to serve. Education is the way to building ICT competency and instilling the skills necessary for citizens to become fully equipped members of the international knowledge economy. The International Labor Officeís, ILO, ëWorld Employment Report 2001: Life at work in the information economyí, found that: ìdespite the communications revolution talking place in the world today, increasing numbers of workers are unable to find jobs or access to the emerging technological resources needed to ensure productivity in an increasingly digitalized global economyî. By addressing such issues, the region can ensure that its labour force meets the needs that ICT development will create. By investing in its human resources, and in the ICT skills necessary to participate in the global economy, the region can ensure the self-sustaining economic growth that arises out of a society rich in knowledge and skills.

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