Issues
Information Communication Technologies (ICTs) can have a transformational impact on poor men and women’s lives, and play an important role in inclusive private sector development. New technology can transform business, support entrepreneurship, and drive innovation and economic growth in the developing world (Yonazi et al. 2012). ICTs can also aid the effectiveness of development interventions, with many agencies supporting the provision of new technology to help reduce the costs and facilitate poverty reduction.
The increased coverage and spread of mobile telephones presents new opportunities for consumers and producers. Phones can be used as a platform to increase access to information and financial services, enhance participation, and help citizens access government services (Yonazi et al. 2012). Improved communication systems can also help firms to better manage their supply chains, and create new jobs in response to the demand for mobile-related services (Aker and Mbiti 2010).
As a key driver of innovation and technology, the private sector can play a vital role in supporting participation and new technology in developing countries. Businesses often own or sell specialised technology which can be crucial to development (Zyck and Kent 2014).
Approaches
ICTs have been used in donor interventions in various sectors. Case study examples show how new technology has been used to help address challenges in agricultural production and food security, such as inadequate access to markets, unfavourable market conditions, and high production and transportation costs (Yonazi et al. 2012; Kora and Kassem 2010). Recent literature shows how ICTs can support smallholder farmers in value chains by improving access to financial services and providing agricultural information (Keeble et al. 2011).
ICTs have also played an important role in reporting labour abuses to improve working conditions.
LaborVoices – increasing worker participation
LaborVoices is a US based NGO that provides global brands and their supply chains with an early warning system, based on direct feedback from workers. Workers are anonymously polled through their mobile phones on safety and working conditions. This provides real-time visibility into working conditions and enables companies to identify and solve problems before they become urgent.
Recent case studies show how ICTs have been used in social entrepreneurship to create social value (Maree et al. 2013). Examples from Kenya and Uganda show how mobile phones have enhanced the capacity of users to upgrade themselves economically and socially (Maree et al. 2013). In Kenya, for instance, mobile phones have been used to deliver finance for start-up entrepreneurs (Maree et al. 2013).
Technology transfer has been used as a component of broader PSD strategies, and can provide tangible gains in a range of sectors. In education, for instance, the introduction and use of new technologies can increase the skills and employability of students. Literature on technology transfer to aid local production emphasises the need for an institutional and policy framework that includes:
- A systematic assessment of national and regional needs, including local production capacity and market viability (UNCTAD 2011)
- A favourable policy framework that promotes domestic and foreign investment in production and technology transfer (UNCTAD 2011)
- Policies and mechanisms that promote access to locally produced goods.
There is a growing body of literature exploring the role of ICT in the delivery of financial services to the poor (Stefanski 2012). In Kenya, for example, the mobile money service M-PESA has been highly successful in offering a range of payment services, including making school payments, paying utility bills, and purchasing travel tickets (Stefanski 2012). Subscribers are also able to collect cash from selected ATMs (Stefanski 2012). Despite the rise of technological innovations for financial inclusion, experts’ caution that tensions between government and donor approaches can hamper implementation (Williams and Johnson 2013). It is recommended that donors undertake political economy analysis to understand the dynamics of financial inclusion (Williams and Johnson 2013).
Impacts
There is a broad body of evidence linking investment in ICTs and economic growth, but less consistent evidence on the links to pro-poor growth (Batchelor and Scott 2005; World Bank 2009). Many ICT interventions are relatively new and so there is limited evidence available about their impact and effectiveness (Dunbar 2013). Key lessons emerging from the literature on the use of ICTs for development include:
- Enabling environment: Governments’ have a key role to play in creating an enabling policy environment for ICT development; acting as role model and key client in adopting new technologies; and widening access to ICT infrastructure and connectivity (Stefanski 2012).
- Cross-sectoral and multi-stakeholder collaboration: Effective use of ICTs requires cross-sectoral and multi-stakeholder collaboration between technologists, development practitioners, and entrepreneurs (Yonazi et al. 2012).
- By 2012, there were approximately 250 million mobile phone subscriptions in Africa, more than in the European Union and the United States of America (Yonazi et al. 2012).
- Aker, J., & Mbiti, I. (2010). Mobile phones and economic development in Africa. Journal of Economic Perspectives, 24(3). See document online
- Batchelor, S., & Scott, N. (2005). Good practice paper on ICTs for economic growth and poverty reduction. Paris: OECD. See document online
- Dunbar, M. (2013). Engaging the private sector in skills development: Final. Oxford: HEART. See document online
- Kora, G., & Kassem, M. (2010). The application of information and communication and technologies in agricultural and rural development in Egypt. Rome: FAO. See document online
- Maree, J., Piontak, R., Omwansa, T., Shinyekwa, I., & Njenga, K. (2013). Developmental uses of mobile phones in Kenya and Uganda (Capturing the Gains Working Paper 35). Manchester: University of Manchester. See document online
- Stefanski, S. (2012). Financial services. In E. Yonazi, T. Kelly, N. Halewood, & C. Blackman, The transformational use of information and communication technologies in Africa. Washington: World Bank. See document online
- UNCTAD. (2011). Local production of pharmaceutical and related technology transfer in developing countries: A series of case studies by the UNCTAD Secretariat. New York and Geneva: UNCTAD. See document online
- Williams, R., & Johnson, S. (2013). Facing up to the political realities of financial inclusion: Time for donors to re-think their approach? Oxford: Oxford Policy Management. See document online
- World Bank. (2009). Information and communication for development 2009: Extending reach and increasing impact. Washington, DC: World Bank. See document online
- Yonazi, E., Kelly, T., Halewood, N., & Blackman, C. (2012). The transformational use of information and communication technologies in Africa. Washington, DC: World Bank. See document online
- Zyck, S., & Kent, R. (2014). Humanitarian crises, emergency preparedness and response: the role of business and the private sector – Final report. London: ODI. See document online