UNCTAD Information Economy Report 2010

Information Economy Report 2010: ICTs, Enterprises and Poverty Alleviation

Comments by Dr Francisco Osorio

The United Nations Conference on Trade and Development (UNCTAD) published in October 2010 a very important macro-economic study on mobile phones and development. I say mobile phones because most of the report is about this technology.

Torbjorn Fredriksson is the study’s team leader, who presented the report at The University of Manchester on October 14th, organised by the Manchester’s Centre for Development Informatics and Brooks World Poverty Institute (see news here). I was giving a printed copy but can be download it here.

The report is organised in five chapters:  (1) Exploring the link between poverty, ICTs and enterprises, (2) Trends in connectivity and affordability, (3) The ICT sector and the poor, (4) ICT use by enterprises and poverty alleviation and (5) The policy challenge.

After attending the presentation and later reading the report, I got the impression of a balanced study. It situates in the middle of two common discourses on M4D: either mobile phones are the final solution to development problems or mobile phones only perpetuates inequality in favour of the rich. The report is optimistic but it is not deterministic: there is evidence mobile phones can help socioeconomic development but also the lack of knowledge is important that cannot supports strong arguments either in favour or against. Simply said nobody knows yet.

We know one thing: mobile phones are important because is the communication technology poor people use the most after TV and radio. In other words, mobile phones are important for the poor. This simple sentence is the starting point of all research. When it is expressed in a graph, the statistical evidence shows a curve that goes up incredible fast (more phones than ever, more poor people using them).

Then the question: what does it mean? For the UNCTAD report it means an opportunity that could be used to help the poor. It does not say it will help, it might. Governments could support the mobile phone industry, because it may help to alleviate poverty. The report, although cautions, bets for an investment without strong arguments in favour. This jump into the unknown may pay well.

Even so, the most important conclusion is that we need more research. The report shows examples from many sources. Going through the references, the only anthropologist cited is Barendregt. Many references go to Donner and Heeks. The key examples come from India and Kenya but there are others from all over the world.

The report says it focuses on enterprises because they can significantly contribute to poverty reduction. The role ICTs play in enterprises, it says, is to give information access and better communications for poor people to help them build livelihood assets.

The report covers many aspects of this relationship between the poor, enterprises and mobile phones (the key ICT) and there is a very good quote that summarises one aspect of this relationship: mobile phones are more effective as a livelihood resource (communication tool) than as a source of livelihood (income generation) for the poor.

There are important distinctions to be made within enterprises. Considering its size, there are micro-enterprises, small and medium and large. Considering its purpose, they could be classified as subsistence based or growth-oriented. Considering use of ICTs, there are directs and indirect uses, either for economic and non-economic purposes. In other words, the landscape is not simple and many distinctions need to be made, instead of using concepts such as enterprises and the role of ICTs as mono-dimensional. The focus of the report is in the direct use of ICTs by poor in enterprises and direct use of ICTs by poor in ICT sector enterprises.

Other important aspect covered by the report is the problem that such a technology is facing around the world: affordability, network coverage, prices, taxes, and public policies against it, among others. Also, the open question is what would happen in the future. If TV and radio are important, well, some mobile phones integrate both into the handset (but they are too expensive to use for the poor). If the Internet is vital to access information, the mobile phone could be the way forward for the poor (still, many problems of affordability here).

As a final comment, I think this report could easily produce impact in the M4D academic community and for our project will be of great importance.

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