ICT Policy Formulation and e-Strategy Development: A ... - un-apcict

effective 49 . Policy-makers also need to be aware of these specialized applications for the delivery
of health services.
ICT AS AN INDUSTRY
The ICT industry is either service-based or focused on hardware manufacturing and/or
assembly. Some companies are involved in all aspects of the business. A national ICT policy
can contribute to the establishment, development and growth of ICT businesses by providing
incentives and support to this sector. This can include giving consumers incentives to buy the
products and services offered by the ICT industry.
Incentives could also take the form of encouraging foreign partnerships or joint ventures,
including foreign direct investment, as well as empowering local businesses. Encouragement
can include tax incentives and reduction or removal of taxes on the import of computer
hardware and peripherals on the assumption that the resultant economic benefits will far
outweigh the loss of revenue. Other incentives include encouraging access to credit, lowering
taxation rates or providing tax holidays, etc. These incentives encourage the creation of a
demand and a local market for ICT goods and services.
As already mentioned, a recent report by UNCTAD 50 states that TNCs exert an influence on ICT
development and diffusion since they control much of the market for development and sale
of cutting-edge technologies. The lack of skills and capital prevents the entry of newer and
smaller firms.
Countries may, therefore, want to consider policies that will encourage national investment by
TNCs as a way of helping local firms, especially small, medium and micro enterprises (SMMEs),
gain the necessary skills and technologies to participate in what is becoming an increasingly
closed marketplace. Costa Rica, which succeeded in attracting Intel, provides a good example
of this 51 as do many of the Asian Tigers.
Beyond the use of classical fiscal incentives, policies that actively strengthen the capacity of
local businesses are also needed. These policies should target those local firms – SMMEs really
– that have the potential to become “flyers”, as Duncombe and Heeks have put it. Otherwise,
the effort may be dispersed. As already mentioned, the creation of business incubators to help
build local capacity may be required. Business incubators strengthen the entrepreneurial base
of a country or jurisdiction 52 . Governments may support business incubators as part of their
policies to promote economic development.
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http://www.Bridges.org, ‘Case study: The compliance service uses SMS technology for TB treatment’, ICT-enabled
Development Case Studies Series: Africa, IICD and Bridges.org, 2003; available at http://www.bridges.org/
iicd_casestudies/compliance/index.html.
50
UNCTAD, Investment and Technology Policies for Competitiveness: Review of Successful Country Experiences,
Technology for Development Series, UN, Geneva, 2003.
51
Gonzalez, A. Key Drivers for Investing in Costa Rica: The Intel Case, OECD Global Forum on International Investment,
New Horizons and Policy Challenges for Foreign Direct Investment in the 21 st Century, 2001; available at http://
www.oecd.org/dataoecd/53/53/2407839.pdf; Nathan Associates, 2003, ‘Successful integration in the global economy:
Costa Rica and Mauritius’, Research report, USAID; available at http://www.dec.org/pdf_docs/PNACS269.pdf.
52
UNIDO, ‘Business incubators: The concept’, 2003; available at http://www.unido.org/en/doc/3736.
ICT Policy Formulation and e-Strategy Development
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