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United Nations Conference on Trade and Development E-commerce and Development Report 2002 Report

by Emmet Cole

The United Nations Conference on Trade and Development (UNCTAD), a UN trade and development agency, has released its 282-page "E-commerce and Development Report" for 2002. According to the Foreword, written by Kofi Annan, the report "provides factual information and analysis covering a range of topics that will influence the expansion of e-commerce in developing countries. It also identifies the policy and business options available to developing countries, and makes practical proposals for maximizing the contribution of e-commerce to economic and social development." E-commerce is described as "helping countries improve trade efficiency" and as "facilitating the integration of developing countries into the global economy." From the outset, an unstated assumption—that the digital divide should be measured, explained, and understood in terms of dollar value and first world business strategies—pervades the entire document.

According to the report, there are now 655 million registered Internet users. While this is a 30 percent increase on 2001, this figure represents only about 10 percent of the world's population. Not surprisingly, the US has the most Internet users, at 143 million—more than any other single country in absolute terms. Next is China with some 56.6 million, while Europe as a whole had 144 million users in 2001, compared to just 108 million the year before. The number of Web users between 2000 and 2001 rose 44.3 percent in Asia, 43.4 percent in Africa, 33.5 percent in Latin America, 32.7 percent in Europe, and 10.4 percent in North America.

The report finds that the nature of the digital divide has shifted in at least one important respect over the last year: developing nations are now undergoing the fastest rates of growth. India is a case in point where 25 percent more people had Internet access in 2001, or one out of every 147 people in the country. Growth is also strong in Latin America, especially in Brazil, Mexico, Chile, Colombia, and Venezuela.

The report demonstrates that developing nations are not sharing in the e-commerce boom to the same degree as those in the developed world with their share in total world e-commerce in 2001 sitting at just 6.7 percent. This figure is expected to grow in the years ahead as more Indian and Chinese businesses begin operating online. Nevertheless, such figures describe a digital disparity that shows no sign of disappearing.

The report portrays the developing world as reaching out to the wealthier and more developed world with varying degrees of desperation in the hope of penetrating the international e-commerce market. Perhaps the authors of the report want to aid the creation of digital infrastructures in developing countries for the sole purpose of later exploitation by multinational commercial interests. Given the global downturn in the IT sector, the "developed" world has a desperate need for fresh markets.

The report observes that digital publishing offers fresh opportunities to poorer states by providing local businesses with the opportunity to establish a presence "in a market dominated by the developed-country giants of the culture industry." By lowering production costs and cutting out intermediaries, innovative software generates new markets and enables unknown authors to expand their readerships. For example, profits from Peru's "informal" book industry are higher than those from traditional publishing.

Although the 'value' of the Internet should not measured only in dollar bills, coverage of this report in the mainstream media has been focused on commercial aspects of the Internet and not on the political and social implications of the digital divide. Thus, we are told that the global value of e-commerce could reach USD2.3 billion this year. That figure, which includes all goods and services purchased on-line, is 50 percent higher than last year. We are also informed that the world's e-commerce industry could be worth USD3.9 billion by the end of next year. The US accounts for around 45 percent of e-commerce, with Western Europe and Japan accounting for 25 percent and 15 percent, respectively.

In emphasizing the transient values of e-commerce over the immeasurable worth of digital equality, the media has merely been following the UN's lead. While the report offers many useful facts and figures and even boasts a chapter dedicated to "Gender, E-Commerce and Development," its fixation on international e-commerce has resulted in a work that severely limited in scope. The analysis doesn't reflect to any great extent on the social aspects of Internet penetration. It doesn't tackle the difficult philosophical and moral issues that the digital divide raises.

Finally, isn't there a danger in measuring the digital divide in purely economic terms? The digital divide is also an information divide. The Internet's capacity to educate, transform and enlighten is currency free. Should the digital divide be treated like a temporary malady that can be relieved simply by opening markets, developing trusted supplier relationships and implementing 'first-world approved' business practices?

You can view the full report at:

Report Contents:
Part One
Chapter 1
E-Commerce around the world: A brief status report
A. Global connectivity and online trade
B. Regional perspectives
C. E-commerce and development: the international dialogue
Chapter 2
The domain name system and issues for developing countries
A. Introduction
B. Domain names - Coming into the mainstream
C. The role of ICANN
D. Domain names and legal issues - The relationship between the DNS and Intellectual Property Rights
E. Concluding remarks and policy recommendations
Chapter 3
Gender, e-commerce and development
A. The relevance of gender
B. Digital opportunities for women
C. Capacity building: rationale for a "gender lens"
D. Other factors affecting women in the digital economy
E. Conclusions and policy recommendations
Chapter 4
A. Introduction
B. Main Features of M-commerce
C. Wireless in Developing Countries
D. E-commerce Applications and Trends
E. Privacy and Data Protection
F. Main Findings and Recommendations
Part Two
Chapter 5
The IT industry, e-business and development
A. Introduction and definition of the Information Technology and Development
B. Trade in IT products and Trade Policy Environment
C. Role of IT in E-business and the developmental impact of the IT industry
D. Methodology of the survey of most important IT multinationals
E. Results of the survey
F. Conclusions
Chapter 6
E-Finance for development: Global trends, national experiences and SMEs
A. Introduction
B. Internet banking
C. Internet payments
D. International electronic trade and finance systems
E. Online credit information and credit insurance systems
F. Private Equity Mobilization
G. Microfinance initiatives
H. Lessons from global e-finance experiences
I. E-finance challenges for SMEs
J. Conclusions
Chapter 7
E-Commerce application the publishing industry
A. Introduction
B. Features of e-publishing and main issues
C. E-publishing in developing countries
D. Copyright issues in the world of e-publishing
E. Concluding summary and recommendations
Chapter 8
A. Introduction
B. Suitability
C. Best practice
D. Regulatory and supervisory issues and insurance activities on the Internet
E. Conclusions
Chapter 9
Export performance and E-Services
A. Introduction
B. Information technology and services export performance
C. Measuring export performance in the services sectors
D. Case studies from developing countries: computer-related services exports
E. Conclusion and policy implications

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