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Georg
Caspary
Modern information and communications technologies
(ICTs) hold great promises for developing countries. However, if
they are to benefit the poor their introduction must be carefully
examined. This article shows several models of affordable access
to ICTs which have been tried in various parts of the developing
world.
Common wisdom has it that the advent of modern
information and communication technologies (ICTs) such as telephony
or the internet hold unprecedented opportunities for developing
countries. Academics, policymakers and entrepreneurs alike frequently
claim that ICTs represent one of the most powerful tools in the
struggle against poverty.
There appear to be good reasons for such claims, too. After all,
there are a number of ways - some obvious and some not-so-obvious
ones - in which ICTs may serve the development process. For instance,
private entrepreneurs benefit because ICTs help to improve access
to markets or supply chains and provide a broader base for decision
making, thus making risk more calculable. Moreover, many local communities
have experienced that ICTs have increased civil society participation
in political decision making processes and may expand the reach
and accessibility of government services and public infrastructure.
In the Indian state of Andhra Pradesh, Internet-based Integrated
Citizen Service Centres allow for electronic bill payment, issuing
of certificates, permits and licenses; or access to public information.
Nevertheless, a word of caution is in order. There is as yet little
systematic empirical evidence of the supposed enormous, developmental
impacts of ICTs. Moreover, in many - especially rural - areas of
developing countries, the private sector is so far less than keen
to invest in ICTs because of lack of experience with rural developing-country
markets or low purchasing power of the local population. This means
that, if ICT access is to be expanded, public money will have to
be spent - which in turn means that there are important trade-offs
to be considered. In many areas, there are serious questions about
how much money policymakers should spare for the build-up of ICTs
instead of investing further in education or health care.
Given such trade-offs, there is a need to identify which kinds
of ICT access deliver the best value for money in developing countries,
and how the limited resources that can be spent on it can be made
to best suit the particular needs of the poor. A number of models
for affordable access have so far been tried.
One of the most famous projects is the Grameen Village Phone system,
undertaken by Grameen Telecom (a member of the Grameen group). The
project aims at ultimately spreading phone access to the over 100
million rural inhabitants of Bangladesh who are so far 'unwired',
made possible by combining the Grameen Bank's expertise in village-based
micro-enterprise and microcredit, with the latest digital wireless
technology. The aim is to have selected member borrowers of Grameen
Bank purchase the phones under a lease finance and make the phones
available to all users in the village on a fee-paying basis.
Recent research by the consulting firm Telecom Development Group
has shown that the Village Pay Phone Program yields significant
positive social and economic impacts, including relatively large
consumer surpluses and immeasurable quality of life benefits. The
consumer surplus for a single phone call from a village to Dhaka,
a call that replaces a physical trip to the city, ranges from 2.6
to 9.8 per cent of mean monthly household income. The cost of a
trip to the city ranges from 2 to 8 times the cost of a single phone
call, meaning real savings for poor rural people of between 132
to 490 Taka ($ 2.70 to $10) per call.
Another model of ICT provision in rural areas of developing countries,
and one which attempts to combine phone access with access to other
ICTs (in particular the Internet), is that of so-called telecentres.
A telecentre is a common point of access for multiple users (often
an entire community), providing a range of ICT services including
Internet, fax, word processing, and even specialised information
retrieval or applications (e.g. distance education).
Telecentres have been established widely in the developing world,
and vary in their service provision and means of funding. In Peru,
the establishment of numerous Cabinas Públicas, has lead
to one of the highest concentrations of public internet access and
a significant reduction in prices. Nevertheless, the experience
with telecentres has so far been a mixed one. In numerous cases,
usage, particularly of PCs, has been lower than expected or commercial
viability was not attained. Of the over 70 Community Telecentres
established since 1997 by the South African Universal Services Agency,
only 40 per cent remain open today, with only 3 per cent making
enough money to cover costs. Many other telecentres failed to serve
their particular target groups (some telecentres are, for instance,
being used disproportionately by tourists).
Telecentres exist in various kinds, each with their respective
merits. First, one might distinguish between small, private sector
telecentres on the one hand and bigger, donor-funded telecentres
on the other hand. Smaller, privately-run telecentres are often
financially self-sustaining - but are thus usually restricted to
areas where they expect to be viable (usually urban centres) and
are usually neither within physical nor financial reach of the poor.
They are also unlikely to be able to provide local content. By contrast,
larger, often externally funded telecentres are rarely financially
sustainable but can focus more on specific 'development' aspects,
including access specifically targeted at rural communities and
the poorest in general, as well as a focus on training.
All this means that it is highly probable that ICTs do hold some
significant potential gains for the development process, leading
to a widely-perceived risk of some developing countries being bypassed
by the ICT revolution if they do not invest into this sector. Yet,
just as great is the danger of exaggerated expectations from ICTs
for development, leading decision-makers to expend scarce public
resources where there is little hard evidence to justify such steps.
Until further systematic evidence on the precise developmental impact
of different ICTs on different communities exists, or until there
is substantially more private investment in this sector, maximising
the use from ICTs for developing countries will require an understanding
not only of the opportunities ICTs present, but also of the trade-offs
involved - and of the particular ways in which ICT access has to
be tailored if any developmental benefits are to be reaped.
Georg Caspary, Policy Analyst at the Organization for Economic
Cooperation and Development (OECD).
Extracted from D+C Development and Cooperation, January/February
2002
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