15 October 2010
GENEVA: The United Nations Conference on Trade and Development (UNCTAD) has urged policymakers in developing countries to make the ICT sector a more important component in their poverty-reduction strategies.
The Information Economy Report 2010, released on Thursday, says that more benefits can be secured for the grassroots creation of small-scale enterprises if enlightened government support is added.
The manufacture of ICT equipment presents a more mixed picture – only a few low-income countries are extensively involved in such industries.
The report calls for more studies of the effects of manufacturing mobile phones, computers and related equipment to assess the benefits and drawbacks for the poor.
The Information Economy Report 2010 also notes that extensive off-shoring of services such as programming, and clerical tasks and processes – which are jobs based on global ICT networks – is still limited to a few developing countries, and tends to employ relatively highly skilled workers.
However, several socially conscious enterprises have recently had some success in expanding ICT services work to rural communities (in India, for example), resulting in new income-earning opportunities for some poor people in rural areas. The report recommends that governments consider policies that could encourage this trend.
ICT-related micro-enterprises are spreading rapidly in many low-income countries and can offer work of real value to populations with little education and scant resources, it added.
This activity includes selling airtime on the streets, refurbishing mobile phones, repairing personal computers, and running cybercafés. Such commercial undertakings have relatively low barriers to entry: the costs and the skills required are often modest, and the poor are taking advantage of this. In Gambia, former street beggars have been hired as sales representatives for Gamcel, one of the country’s major mobile telecom operators. Other examples cited in the report are the selling of airtime in Bangladesh, Ghana, and Uganda; the running of cyber centres in Nigeria and the Bolivarian Republic of Venezuela; and the creation of ICT-based enterprises in the slums of Mumbai, India.
However, UNCTAD also stresses that ICT micro-enterprises typically operate in a volatile and risky sector, and returns on investment are often low. Micro-entrepreneurs must have the capacity to adapt and respond to change. The report notes that the opportunities for ICT micro-enterprises to survive and grow are greater in urban settings, where it is easier to establish essential relationships with other enterprises, both formal and informal. The scope for creating long term jobs around such activities in rural areas appears to be more limited.
The report added that the manufacture of ICT goods, such as mobile phones and computers, is characterized by large economies of scale and global production systems.
The rapid expansion of this industrial sector has created opportunities for the poor, but only in a few countries.
Exports of ICT goods are highly concentrated geographically: the top 10 exporters accounted for over three quarters of world exports of ICT goods in 2008. In China – by far the single largest exporter of such items – ICT manufacturing has made a significant contribution to the incomes of the poor.
UNCTAD estimates that it has created 25 million manufacturing jobs for workers migrating to cities from the Chinese countryside. Moreover, up to $18 billion of their annual incomes may be remitted to their rural villages.
On the other hand, these migrant workers are often vulnerable to layoffs and may suffer difficult working conditions.
The Information Economy Report 2010 calls for more research so that a better picture can be obtained of the impact of ICT manufacturing on poverty reduction. – The Daily Star
Copyright The Daily Star 2010.
