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WITSA addresses the digital divide

By Adrian Schofield, Vice Chairman, World Information Technology and Services Alliance (WITSA)

The World Information Technology and Services Alliance (WITSA) is a consortium of information technology (IT) industry associations from 50 economies around the world. WITSA members represent a vast majority of the world IT market, and as the global voice of the IT industry, WITSA is dedicated to advocating policies that advance the industry’s growth and development; facilitating international trade and investment in IT products and services; and strengthening WITSA’s national industry associations through the sharing of knowledge, experience, and critical information.

While originally founded in 1978, new WITSA member associations are representing the markets in mainly developing economies. WITSA’s membership rose from 22 in 1998 to 50 currently. Of the 27 new economies joining the Alliance since 1998, 22 were from emerging economies. As a result of this transformation in membership, WITSA has increasingly assumed an active advocacy role in international public policy issues impacting the “Digital Divide”.
WITSA Chairman George Newstrom with Charles Nduati (Kenya) and Nguyen Anh Tien (Vietnam) inducted as new WITSA members in October 2002 WITSA has a real impact on the global IT environment. It strengthens the industry at large by promoting a level playing field and by voicing the concerns of the international IT community in multilateral organizations, including the World Trade Organization (WTO), the Organization for Economic Cooperation and Development, the G-8 and other international fora where policies affecting industry interests are developed.

Seizing Digital Opportunities
Preventing a "digital divide" is an essential goal for both business and governments. According to the benchmark WITSA study, The Digital Planet 2002, one socioeconomic discontinuity remains a major world challenge: the top ten information economies represent 80 percent of the global; ICT market; the bottom ten (of 55 surveyed countries) represented a collective share of less than one percent. This disparity has come to be known as the “Digital Divide” – the gap between nations that do and do not make technology investments. Business has been working hard through independent projects to provide assistance to disadvantaged economic groups, localities, regions or countries, aimed at transforming the digital divide into a digital opportunity. Almost any sizeable company today has taken up some local or regional responsibility in bridging the digital divide. Developing countries can reap these benefits resulting from the technological innovations that have led to the commercialization of the Internet -- they can leapfrog technologies and become active participants in the online global economy. However, these assistance programs will become a digital opportunity only if governments adopt a policy framework which ensures that access to digital information and communication networks is a viable option for the citizenry at large. Global business organizations which support the present statement believe that such a policy framework is one that promotes open markets, competition and private sector investment.

In order for innovation to actually generate productivity and income impacts at the economy-wide level, the necessary inputs and conditions must also be widely available. A crucial policy challenge is to encourage and promote the expansion and distribution of “digital” opportunities. These opportunities can contribute to and encourage economic development. Trade liberalization is a key energizer of this global imperative - increased liberalization in both goods and services and effective implementation of the TRIPS agreement are an essential element in ensuring that countries can seize the digital opportunity.

Business has spent enormous resources on research and development to make the Internet an effective commercial medium that has brought about substantial increases in economic efficiency¹ through more transparent processes and greater information. These efficiencies are manifested, for example, through reduced production cycles and better customization of products and services. Productivity resulting from innovation will be maximized when the regulatory environment surrounding the labor, capital and product markets is conducive to competition and adaptation. Indeed, the commercial use of the Internet has already increased competition within markets.

In particular, developing countries can reap these benefits resulting from the technological innovations that have led to the commercialization of the Internet -- they can leapfrog technologies and become active participants in the online global economy. This obviates the need for developing countries to reinvent the wheel and can lead to access to the global marketplace and economic growth. However, to seize the benefits of technological advances governments must accept and encourage new business models and new markets necessitating that some more traditional ways of doing business be modified or abandoned.

Importantly, trade can assist the promotion of adjustment in industries and firms faced with the challenge of adapting new opportunities to facilitate continued growth. One of the implications of the new economy is that it strengthens the case for trade and investment liberalization in traditional sectors. The benefits of technological change will only be fully realized if traditional sectors are able to operate more freely and flexibly by responding to and confronting new markets that are the result of innovation and digital opportunities.

Currently, public policy discussions which are carried out under the catch word of "digital divide" seem overly focused on the divide, as a result rather than a risk, and do not stress sufficiently either the opportunity aspect or an understanding of the conditions under which inadequate endowment turns into a trap. In order to reduce the risk that discussions on the "digital divide" become a self-fulfilling prophesy, discussion needs to focus on developing greater understanding of how to advance digital opportunities.

WITSA is Taking Steps to Bridge the “Digital Divide”
WITSA, with its evolving membership, has recognized the challenges from emerging economies and have taken steps to address the issues. Developing viable, sustainable and effective IT associations in developing countries so that people may take a stronger role in helping themselves, is one such example.

ITAA and WITSA form Alliance with USAID
The Information Technology Association of America (ITAA) and WITSA recently signed a memorandum of understanding with the US Agency for International Development designed to develop sustainable IT associations in developing countries. The program, which designates up to $1 million over three years, will provide educational experiences and opportunities to attend global meetings, policy workshops and agenda setting initiatives to executives of information technology associations initially in developing countries throughout Africa and Asia. The MOU will also provide training in association organization and management, in developing effective association programs, and in public policy development.

ITAA and WITSA have long supported growing the IT base in developing nations because of the very positive effect IT can have on their economies. The MoU provides for meaningful alliances through the assistance of USAID, and development of savvy tech leaders throughout the globe.

Already, the MOU has resulted in increased outreach to IT groups in the developing world and has resulted in the Computer Society of Kenya joining WITSA. USAID provided travel reimbursement for four African WITSA members from Egypt, Morocco, South Africa and Kenya to attend recent meetings with the OECD. The members learned about OECD policy initiatives with regard to information technology and met key OECD officials. In addition, the African members participated in an African Strategy Session about how to implement the MOU in Africa.

Working Closely with the World Bank

WITSA is also working closely with the World Bank and its Information for Development Programme (infoDev). Most recently, WITSA received a $30,000 Conference Scholarship Fund (ICSF) grant to ensure the participation of 15 developing country association executives to attend the February 26 to March 1, 2002 WITSA World Congress on IT and General Assembly meeting in Adelaide. The purpose of the grant was to sponsor the conference participation of ICT association professionals from developing countries.

WCIT2002 provided delegates with an exceptional opportunity to hear from the world’s leading authorities on a range of issues relating to information technology and its impact on our society. The Congress’ keynote speaker, former US President Bill Clinton, delivered a powerful address outlining technology’s important role in achieving a more integrated world, particularly in the areas of security, education, health and the environment.

As iCSF Fellows, the 15 WITSA IT industry association executives from developing countries were uniquely positioned to take home the knowledge obtained from the high-level discussions on emerging markets, and legal, political and economic trends affecting business opportunities in different markets. Due to these association executives' extensive contacts within the industry as well as with government officials in their respective countries, they are now in a better position to channel the lessons learned to a great many individuals and organizations. Long-term benefits will include more business opportunities for local and national IT industry, and the creation of a pro-competitive and sound legal framework. The high level contacts that developing country association executives made at the World Congress are unsurpassed. The entire event program was especially designed so as to maximize the benefits of networking. Developing country delegates were also offered active business matchmaking while in Adelaide.

Creating a Favorable ICT Environment in Developing Countries
WITSA is currently involved in a project that aims to create a conceptual framework within which international institutions and national governments may more effectively formulate policies and practices that utilize available ICT private sector resources in support of sustainable economic development and societal needs. The project, which will be launched later this year, will support the efforts of international donor institutions and national governments to integrate private sector ICT activities and resources into the development of developing economies including the identification of markets for ICT products/services that meet specific societal needs. It also aims to facilitate the private sector as a potential partner of national governments and international donor institutions, and review alternative policies and practices that may foster the development of new ICT private sector enterprises. Importantly, the program will review existing ICT financial, investment and regulatory regimes, identify barriers to ICT commercial activities and generate specific policy recommendations so as to ameliorate existing barriers to ICT private sector investment in selected developing economies.

A project team will consistently coordinate its efforts with relevant activities in the selected countries. Data generated by an on-line survey will provide a framework for identifying specific policy objectives in each country. The project engages a unique investment risk analysis methodology (INRAM) developed by the Paradigm Group to generate specific information that establishes a numerical value for specific risk criteria, indicated as the “Investment Risk Index.” The process will allow comparative analysis of underlying policy frameworks that inhibit investments thought the creation of unacceptable risks. Coupled with an active in-country advocacy campaign, the project offers the potential to effect real change.

Meeting Global IT Skills Needs
On October 25-27, 2002, WITSA co-sponsored with the Organization for Economic Cooperation and Development (OECD) and the International Federation for Information Processing (IFIP), a joint working conference entitled “Meeting Global IT Skills Needs – the Role of Professionalism”. The event, which took place in Woking, United Kingdom, brought together some 35 experts on IT Skills and Professionalism from 14 countries. Eleven papers were given by an international panel of speakers focusing on three key aspects of IT skills needs – demand, supply and constraints. Participants also exchanged views and experiences in extended working group sessions.

At the closing session, participants agreed to continue their work by agreeing to share best practice relating to skills issues, for example by addressing inclusiveness issues, and specifically (with contributions from the organizations indicated) to: develop a high level reference model covering groups including IT professionals, IT practitioners and others (BCS, NGI, ACM, ACS, e-skills UK); develop an inventory of IT professional registration arrangements in support of inter-national mobility (IFIP); explore options for extending international equivalencing of IT qualifications to support international mobility (drawing, for example, on experience with the Washington Accord) (ACM/IEEE-CS/CIPS); and explore the value of greater alignment of occupational frameworks internationally for different purposes (with different customers). See http://www.witsa.org/press/IFIP-OECD-WITSAFinalStatement.htm and http://www.globalitskills.org/ for further details.

Statement on Digital Opportunities
In a January 2001 statement entitled “Seizing Digital Opportunities: A Business Perspective”, published in conjunction with its Alliance for Global Business (AGB) partners, WITSA outlined its belief that such a policy framework is one that promotes open markets, competition and private sector investment. Incentives also have to be correct for skill acquisition and necessary changes in the organization of the workforce, and governments must pursue important trade-related objectives enabling innovation, including:

  • An early focus and agreement on the agenda for a new WTO Round;
  • Substantial outreach to LDCs to encourage their full participation;
  • Reinforced and implemented commitments;
  • An acceleration of the Services 2000 effort;
  • The strengthening of intellectual property protection;
  • The elimination of tariff inhibitions to products essential for ICT;
  • The permanence of tariff-free cyberspace;
  • Serious attention to trade facilitation and full implementation of the Valuation Agreement;
  • Elimination of non-tariff barriers;
  • Implementation of international standards and simplified conformance testing; and
  • Expeditious accession of new members to the WTO.

Since its publication, WITSA has been engaged in a program design to implement these beliefs.

Business-Government Forum on Digital Opportunity
In conjunction with the OECD "Emerging Market Economy Forum" in Dubai on January 16-17, 2001, WITSA also hosted with its AGB partners, a January 15 business-government forum on e-commerce entitled “Maximizing the Digital Opportunity”. The purpose of the business-government forum was to highlight the private sector's priority needs for policy coherence between countries, and the international trade and economic policy issues "which need to be addressed to make the digital economy a reality for emerging market economies as well as advanced market economies" (see press release). Several WITSA representatives spoke at the two Dubai events, including:

  • WITSA Executive Director (see presentation at OECD or WITSA site)
  • Dr. Waclaw Iszkowski, President of the Polish Chamber of Information Technology and Telecommunications (PIIiT)
  • Ms. Silvia Bidart, Executive Director of Cámara de Empresas de Software y Servicios Informáticos; CESSI (Argentina); and Chairman of the WITSA Task Force on Developing Countries. See presentation at OECD or WITSA site.

E-Readiness Report
Separately, WITSA collaborated with McConnell International in issuing a first E-Readiness report, entitled “Risk E-Business: Seizing the Opportunity of Global E-Readiness” (August 2000). The Report measures the E-Readiness in 42 countries, which is the capacity to participate in the global digital economy. According to the report, the current ICT-led expansion is at risk, threatening the global economy. Global e-society stands at a turning point. Action or inaction by national governments and industry leaders will produce a very mixed set of outcomes. Some countries will make technology a driver for a new national economy, leaping from an agrarian or industrial base into the knowledge economy. Others will fail to take the necessary steps and will be left behind in the race for cyber markets. The 42 countries were selected as “critical economies” because they represent the “source of the next phase of world economic growth”: make up almost 75 percent of the world population and a quarter of the global GDP. Twenty-three of the 42 countries have at least two areas where substantial improvement is needed. Without significant progress over the next three years, these countries will face great challenges in catching up with the global leaders. The level of readiness was based on criteria such as Internet access, E-leadership, information security, human capital, and E-business climate.

WITSA collaborated with McConnell International in issuing a second E-Readiness report in May 2001, rating 53 key economies. Many WITSA members contributed to this report, which updated the August 2000 study. Among its key findings: Opportunities for continued e-business growth abound in the markets of developing countries! Please see the report, entitled "Ready? Net. Go! Partnerships Leading the Global Economy" in its entirety at http://www.witsa.org/papers/e-readiness2.pdf as well as the press release at http://www.witsa.org/press/e-readiness2PR.htm. The report suggested that e-business, e-government, and e-society increasingly now were on the front burner in leading emerging economies. In the “post-Dot.Crash”, it was seen as a time for catching up with the rich countries. The report also found scores of business opportunities for companies willing to work with local partners to bring the benefits of the networked age to large numbers of the world’s people.

WITSA recognizes the needs presented by developing economies and is engaged in a multifaceted program with its association members throughout the world to address these needs. In addition, WITSA is engaged in an international outreach program to identify new members, particularly in developing economies, to bring the programs and benefits of the Organization to them.

Full versions of WITSA’s statements can be found at http://www.witsa.org/papers/.

Adrian Schofield
Born in the south of England, emigrated to Southern Africa in 1981, where he has worked in the fields of casino administration, payroll processing, software sales, recruitment & contracting of IT skills and technical training.

Job Title
Director & CEO of Ermald Trading (Pty) Ltd, providing consulting and association management services in the ICT sector.

Other responsibilities
President of Information Industry South Africa since January 2000; Member of ICT Development Council; Chairman of SAVANT Steering Committee; Past President and current Management Committee member of Information Technology Association of South Africa; Vice-Chairman for Africa of WITSA; Board member of ICT Sector Education & Training Authority; Member of the Computer Society of South Africa.

¹ See the OECD Report The Economic and Social Impact of Electronic Commerce: Preliminary Findings and Research Agenda, Paris, 1999.

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