COMMUNICATION: Information Technology Industry Strong Despite Crisis

By Gustavo Capdevila Reprint | | Print |

Gustavo Capdevila

GENEVA, Feb 19 2003 (IPS) - Information and communication technologies (ICT) remain a powerful engine of growth, despite the crisis that has led to the collapse of a number of companies in the industry in recent years, according to a new World Economic Forum (WEF) report released Wednesday.

In its ”Global Information Technology Report 2002-2003: Readiness for the Networked World”, WEF – which was founded in 1971 by prominent business, political and academic leaders in the Swiss resort city of Davos – points to the continued consolidation in the ICT sector despite the ”prevailing heightened uncertainty in the global economy.”

Besides outlining the global outlook for the sector, the new report ranks 82 countries with respect to the use and application of ICT and ”rates the economies according to their degree of preparedness to capture fully the benefits of the networked economy.”

Topping the Networked Readiness Index is Finland, which stands out for the use of ICT by its citizens, business community and government.

Although the United States continues offering ”the best market environment for networked readiness,” it lost its first-place ranking due to its diminished competitive edge in terms of connectivity and diffusion of ICT, says the study.

Information technologies constitute the backbone of a number of economic activities, such as banking, airlines and publications, while providing significant added value for consumer products like TV sets, cars and cell-phones, says WEF.

WEF, which has gained renown in the past decades for its annual gatherings of the world’s top government and corporate leaders in Davos, describes itself as ”a collaborative framework for the world’s leaders to address global issues.”

WEF Managing Director José María Figueres underlined that the release of the report coincided with the sessions in Geneva of the preparatory committee for the World Summit on the Information Society.

The conference will open Dec. 10-12 in this Swiss city, and will be concluded in Tunisia, in 2005. The United Nations has convened the summit in search of formulas for closing the digital divide separating rich and poor countries.

Figueres underlined that the summit needed assessments of the state of ICT like the one offered by the WEF report, in order to evaluate the progress made in that field.

The experts with WEF and other specialised institutions who drew up the report said the crisis in the ICT industry had provided lessons, especially for governments with respect to the adoption of appropriate policies.

WEF economist Fiona Paua said that ”beyond just providing a yearly snapshot, the report intends to aid leaders in crafting the best policy environment for competing in a networked global economy.”

The collapse of the ”new economy”, which dragged a number of ICT companies into bankruptcy in the past few years, forced countries to design national policies that have given rise to new energies, said Bruno Lanvin, manager of the World Bank’s Information for Development Programme.

But he stressed that the decline has not been limited to the ICT industry, and said it was an illusion to believe that the new economy could be managed separately from the rest of the world economy, as it experienced a slowdown.

Singapore is in third place on the Networked Readiness Index, although it appears at the top in terms of its ”political/regulatory environment” and ”the readiness of its government to employ ICT in its internal processes and delivery of services.”

Germany is in 10th place, but is described as ”the strongest of the 82 economies in terms of ICT usage by businesses.”

The report states that Israel stand out among the world’s emerging economies, ranking 12th on the index due to outstanding results in terms of innovation.

Estonia, in 24th place, ahead of Spain, Italy and Portugal, was boosted by the government’s readiness and usage of ICT.

In Latin America, Brazil is in the lead, ranking 29th overall, mainly due to the use of on-line technologies by the government.

The report also underscores the performance of two African nations, Tunisia (which ranks 34th) and Botswana (44th).

The experts at WEF and the French institute INSEAD, which collaborated in preparing the report, mentioned the difficulties faced in compiling up-to-date statistics on the ICT industry.

For that reason, they said, the second annual report only covered 82 countries, although they were confident that future editions would include additional economies, especially in Africa.