INFORMATION AS AN ECONOMIC RESOURCE

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INFORMATION AS AN ECONOMIC RESOURCE
United Nations Economic Commission for Africa
(UNECA)

• Moubarack LO
• (Keynote Speaker)
• (CODI IV)25-28 April 2005 Addis Ababa, Ethiopia

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PLAN DE LA PRÉSENTATION

• INTRODUCTION
• I. INFORMATION AS A KEY FACTOR IN ECONOMIC GROWTH
• II. INFORMATION STRENGTHENS THE COMPETITIVENESS
  OF BUSINESSES AND NATIONS IN SEVERAL WAYS
• III. AFRICAN COUNTRIES MUST PUT IN PLACE
  INFORMATION- AND KNOWLEDGE-FRIENDLY STRATEGIES

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INTRODUCTION

• 3 new attributes of Information
• Information has taken on unprecedented scope as a
  result of the rise of the mass media , the advent
  of information technology, the spread of
  telecommunication networks, and the convergence
  of information technology, telecommunications and
  audiovisual technologies.
• Information has become much easier to create,
  gather, process, store, disseminate and use in
  day-to-day activities of firms.
• Information has the virtually unique capacity to
  be used, reused, processed, shared and exchanged
  without losing value indeed, it generates added
  value through this process.

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INTRODUCTION

• Information or Knowledge?

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INTRODUCTION

• INFORMATION OR KNOWLEDGE ?

A FIRMS REAL STRATEGIC RESOURCE LIES IN
KNOWLEDGE AND UNDERSTANDING RATHER THAN IN
INFORMATION ALONE
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INTRODUCTION

• Some concepts
• INFORMATION GOOD
• INFORMATION AND COMMUNICATION TECHNOLOGIES
• INFORMATION INDUSTRY
• INFORMATION SOCIETY
• INFORMATION ECONOMY

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I. INFORMATION AND ECONOMIC GROWTH

THE MACROECONOMIC EFFECTS OF INFORMATION
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I. INFORMATION AND ECONOMIC GROWTH

• ECONOMIC RESEARCH DEALING WITH THE RELATIONSHIP
  BETWEEN INFORMATION AND ECONOMIC GROWTH GENERALLY
  FOCUSES ON THE IMPACT OF THE INTRODUCTION OF ICTS
  ON PRODUCTIVITY.
• SOLOW PARADOX (1987).

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I. INFORMATION AND ECONOMIC GROWTH

• THE END OF SOLOW PARADOX
• ECONOMETRIC TESTS RESULTS
• Source Gordon 2000

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I. INFORMATION AND ECONOMIC GROWTH

• CONCLUSION THE LABOR PRODUCTIVITY GROWTH IS
  STRONG AND COULD DERIVE FROM THREE SOURCES
  (Haacker-Morsink (2002))
• Capital deepening, which gives workers increased
  capital in quantitative and qualitative terms
• A higher quality of the labour factor, including
  more highly qualified manpower and
• Increased total factor productivity (TFP) as a
  consequence of technical advances, innovations or
  restructuring of a companys working methods.

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I. INFORMATION AND ECONOMIC GROWTH

• HOWEVER, ECONOMISTS REMAIN DIVIDED ON TWO
  QUESTIONS
• IS THE INCREASED LABOUR PRODUCTIVITY CAUSED BY
  ICTS PERMANENT OR TEMPORARY? AND
• IF THERE IS AN OVERALL INCREASE IN TOTAL FACTOR
  PRODUCTIVITY, IS IT LIMITED TO THE ICT PRODUCTION
  SECTORS OR DOES IT INCLUDE USER SECTORS?

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I. INFORMATION AND ECONOMIC GROWTH
Diagram 1  Explicative factors of the
technical progress in the ICT sectors Source
Bureau fédéral du Plan de Belgique.
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I. INFORMATION AND ECONOMIC GROWTH
Graph Effect of the growing use of ICTs on
the gross domestic product (GDP) of OECD
countries  (Source OECD)
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I. INFORMATION AND ECONOMIC GROWTH

• Research made in the Global Information
  Technology Report 2004-2005, published by the
  World Economic Forum, has found that
• Countries with GDP less than 5000 enjoy the
  highest productivity gain
• Trade barrier is one of the critical factors on
  the level of ICT usage.

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I. INFORMATION AND ECONOMIC GROWTH

• ECONOMIC POLICY LESSON FOR LESS DEVELOPED
  COUNTRIES (endogenous growth theory)
• THEIR GOVERNMENTS MUST PROMOTE GROWTH BY
  PROVIDING INCENTIVES FOR AGENTS ACTIVE IN THE
  KNOWLEDGE PRODUCTION SECTORS, WHICH ARE
  HUMAN-CAPITAL-INTENSIVE AND INCORPORATED INTO THE
  GLOBAL IDEAS EXCHANGES NETWORKS.

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I. INFORMATION AND ECONOMIC GROWTH

• AN EMERGING NEW ECONOMY?
• SOME ECONOMISTS (GORDON (2000)
  BOSTWORTH-TRIPLETT (2000)) HAVE DOUBT IN THE SO
  CALLED  DIGITAL REVOLUTION. FOR THEM, THE
  IMPACT OF ICT DIFFUSION (TFP GROWTH) IS
  CONCENTRATED SOLELY IN THE ICT SECTOR.
• IN THE CONTRARY, HAACKER-MORSINK (2002) ESTIMATES
  THAT ICT DIFFUSION HAS STRUCTURAL CONSEQUENCES ON
  THE ECONOMY SIMILAR TO THE ONES GENERATED BY THE
  PREVIOUS INDUSTRIAL REVOLUTIONS (ELECTRICITY,
  TRANSPORTATION).

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I. INFORMATION AND ECONOMIC GROWTH

• AN EMERGING NEW ECONOMY?
• THE REAL ECONOMIC FACTS DEMONSTRATE THAT WE ARE
  WITNESSING THE EMERGENCE OF A NEW ECONOMY
• THIS NEW ECONOMY IS BASED, BUT NOT ONLY, ON
  INFORMATION AND ICTS, WHICH BOTH STIMULATES AND
  IS SUPPORTED BY THE PROGRESSIVE DOMINANCE OF THE
  SERVICE SECTOR IN THE WORLD ECONOMY AND BY
  LIBERALIZATION OF THE TRADE IN GOODS, SERVICES
  AND IDEAS.

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I. INFORMATION AND ECONOMIC GROWTH
STRONG GROWTH WITH LOW INFLATION
CREATION OF NEW JOBS
ACCELERATION OF SCIENTIFIC INNOVATIONS AND THEIR
DIFFUSION
NEW ECONOMY
RE-ENGINEERING OF THE PRODUCTION METHODS OF
COMPANIES
INTEGRATION OF FINANCIAL MARKETS
EXPANSION OF E-COMMERCE
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I. INFORMATION AND ECONOMIC GROWTH

• SEVERAL COUNTRIES ARE THUS SEEKING TO MAKE
  INFORMATION THE ENGINE FOR THEIR DEVELOPMENT BY
  ADOPTING A CLEARLY ARTICULATED VISION
• CANADA (to become the first country to build an
  e-economy in the twenty-first century)
• FINLAND (the most competitive country in the
  world)
• IRELAND (to be the  European E-hub)
• INDIA (major ICT exporter software)
• SINGAPORE (The intelligent island)
• MALAYSIA (Multimedia Super Corridor) .

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II. INFORMATION AND COMPETITIVENESS

THE MICROECONOMIC EFFECTS OF INFORMATION
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II. INFORMATION AND COMPETITIVENESS

• While economists continue to disagree as to the
  macroeconomic impact of ICTs, this is not true
  with regard to microeconomics.
• There is a wide consensus to consider that
  information and ICT play key roles in the new
  competitiveness paradigm and that businesses must
  adapt to this new deal.

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II. INFORMATION AND COMPETITIVENESS

• There have been great changes in the concept of
  the competitiveness of business and nations
  intangible factors (such as know-how and
  technical innovation) have taken on increasing
  importance by comparison with tangible factors
  (such as raw materials), radically transforming
  the manner in which businesses operate.

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II. INFORMATION AND COMPETITIVENESS
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II. INFORMATION AND COMPETITIVENESS

• COMPETITIVENESS IS NOW ACHIEVED, NOT BY
  DEVELOPING COMPARATIVE PRICE ADVANTAGES AND
  COUNTING ON AN ABUNDANCE OF NATURAL RESOURCES,
  BUT RATHER THROUGH INNOVATIVE PRODUCTS AND
  PROCESSES AND SERVICES PROVIDED TO CUSTOMERS
  (MICHAEL PORTER).
• IT IS ACHIEVED THROUGH BETTER MANAGEMENT OF
  KNOWLEDGE AND COMPETENCIES, GREATER FLEXIBILITY
  AND BY DOING BUSINESS _at_ THE SPEED OF THOUGHT
  (BILL GATES).

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II. INFORMATION AND COMPETITIVENESS
INFORMATION AS A FACTOR OF COMPETITIVE ADVANTAGE
(Porter)
Role in the composition of products and services
Facilitate management tasks
Powerful marketing instrument
COMPETITIVE ADVANTAGE
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II. INFORMATION AND COMPETITIVENESS
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II. INFORMATION AND COMPETITIVENESS

• NECESSITY FOR THE FIRM TO ORGANISE INFORMATION
  MANAGEMENT THROUGH
• TECHNOLOGY WATCH
• KNOWLEDGE MANAGEMENT
• ECONOMIC INTELLIGENCE
• BENCHMARKING

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II. INFORMATION AND COMPETITIVENESS

• CONSEQUENCES FOR THE FIRM
• NEW AND CONTNUOUS INVESTMENTS IN TECHNICAL AND
  HUMAN RESOURCES
• COMPLETE REDEFINITION OF STRATEGY
  (OUT-SOURCING)
• CHANGE OF STRUCTURE (A MORE STREAMLINED
  ORGANOGRAM PARTICIPATIVE MANAGEMENT)
• PUT THE CLIENTS AT THE HEART OF THE FIRM
  OPERATIONS.

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II. INFORMATION AND COMPETITIVENESS

• Roles of the State as strategist
• Acting as a model user of ICTs (E-Government)
• Promoting telecommunications infrastructures and
  related policies
• Regulating access to information
• Reducing imperfection of information
• Facilitating sharing and protection of
  information
• (in the framework of the ADPIC Agreement)
• Promoting Information for All (reduce the
  digital gap)
• Set an example by being transparent.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION EDGE

• IS IT IN AFRICAS INTEREST TO USE INFORMATION AS
  A BASIS FOR ITS DEVELOPMENT?
• HAS IT THE POTENTIAL TO DO SO?

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• MOST AFRICAN COUNTRIES ARE POOR AND KEPT IN A
  VICIOUS CIRCLE OF SLUGGISH ECONOMIC GROWTH AND
  LOW COMPETITIVENESS
• JUST AS POVERTY TENDS TO DIMINISH ACCESS TO
  INFORMATION AND KNOWLEDGE SYSTEMS AND PROCESSES,
  LACK OF ACCESS TO INFORMATION FLOWS AND KNOWLEDGE
  SYSTEMS AND PROCESSES IS ITSELF A SOURCE OF
  POVERTY.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• AFRICA IS POOR BECAUSE
• IT CANNOT EASILY INTEGRATE
• INTO THE INFORMATION AGE.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• THE ONLY WAY OUT OF ITS PREDICAMENT IS URGENTLY
  TO ACHIEVE THE VISION OF

BECOMING A KEY PLAYER IN THE INFORMATION SOCIETY
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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• THE GLOBAL ECONOMYS TRANSITION TO AN
  INFORMATION- AND KNOWLEDGE-BASED ECONOMY OFFERS
  TO AFRICAN COUNTRIES NEW OPPORTUNITY TO DEVELOP
  COMPETITIVE ADVANTAGES BASED ON THEIR HISTORY AND
  ON THE SUBSTANTIVE CONDITIONS WITH WHICH THEY ARE
  FAMILIAR.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• 2 MAJOR HANDICAPS FOR AFRICA

INFORMATION IMPERFECTION
LIMITED SIZE OF MARKET
LOW CONNECTIVITY
LIMITED SPREAD OF ICTS
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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• These fundamental handicaps, however, should not
  be a reason to give up
• Africas priority should be to demonstrate
  political will, set the process in motion and
  firmly commit itself to the pursuit of a
  development strategy that gives primacy to the
  dissemination of information, knowledge and ICTs.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• NEED OF VISION AND POLITICAL WILL
• African Information Society Initiative (AISI) in
  1996
• New Partnership for Africas Development (NEPAD)
• African Union Commission.
• NEED OF SUPPORT FROM INTERNATIONAL PARTNERS
• Millenium Development Goals
• Digital Solidarity Fund.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• NEED OF APPROPRIATE STRATEGIES
• To develop and implement national strategies,
  including sectoral strategies, reflected in local
  strategies.
• The national information and communication
  infrastructures (NICI) are sufficiently complete
  to serve as action frameworks.
• .

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• Agenda for action
• Mainstream the NICI
• Earmark adequate budgetary resources
• Incorporate an information dimension into every
  future public policy structure.
• Remodel the regulatory policies in the economic
  sphere
• Follow-up and assessment.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE
VISION
OBJECTIVES
STRATEGIES
ACTION PLAN
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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

Strategies to be implemented in the Committee on
Development Information (CODI) sectors
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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• Information and Communication Technologies
  (ICTs)
• AFRICA CAN CLAIM A PLACE IN THE GLOBAL ICT
  BUSINESS
• ICT-USE-BASED SERVICES HAVE INCREASED DURING THE
  PAST FEW YEARS AND THE SUPPLY IN THAT AREA IS
  ALREADY CREATING MANY NEW OPPORTUNITIES IN AFRICA
  (EXAMPLE CALL CENTRES).

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• ICTS, BY MAKING INFORMATION AND KNOWLEDGE
  ACCESSIBLE, CAN CONTRIBUTE TO POVERTY
  ALLEVIATION.
• BY USING ICT, SMALL PRODUCERS, WHO WERE HITHERTO
  AT THE MERCY OF MIDDLEMEN, CAN INCREASE THEIR
  INCOMES (SEE MANOBI CASE).

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• This calls for the development of a series of
  information systems focused on the poor
• These information systems may be related to
  financially viable markets, income-generating
  outlets, government services, governance issues,
  health care, HIV/AIDS prevention and treatment,
  education and capacity-building programmes.
• They must be based on technologies and
  applications adapted to the characteristics of
  the target groups and to the environments in
  which they live
• Priority should be given to information systems
  using the spoken word ( particularly in local
  languages), sound and images or touch-screens.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• To fully achieve the development potential of
  ICTs, the emphasis should be on
•  The legal and regulatory environment
•  Development of technical infrastructures
• Content in terms both of marketable products and
  services, and of the promotion and development of
  African cultural values
• Development of the human resources necessary for
  emerging areas of specialization, and life-long
  training
• Encouraging businesses to use information systems
  and ICTs in every aspect of their work
• Addressing governance issues relating to
  information access, dissemination and use
• Creation of information systems on markets, using
  easily-available, low-cost and user-friendly
  terminals.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• Economic Statistics
•  The availability of reliable statistical data is
  of fundamental importance for private-sector
  operators, who use them to make projections and
  to take strategic decisions, especially with
  regard to investments.
• Statistical services should be able to properly
  gather, process, analyse, interpret and
  disseminate data quickly and impartially using
  easily-accessible media.
• The development of ICTs offers many opportunities
  for statistical services to produce their
  statistics more quickly and economically and
  allows them to work on microeconomic data, which
  they can then easily compile in order to study
  larger bodies of data.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• Economic Statistics (Cont.)
• Dissemination of data and consumer relations are
  also improved by the emergence of ICTs.
  Statistics can thus be posted on a web site and
  subscriber companies can receive specific data on
  their areas of activity electronically.
• Informatics make it possible to draw up
  consolidated company balance sheets in the level
  of the Central Banks. It makes it possible to
  identify a businesss risk potential in the
  context of bank loans and thus to reduce
  information asymmetry on the financial market.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• Geographical Information Systems
• Measures to be taken at the national and
  continental levels include
• Sensitizing African decision makers to the value
  and utility of studies based on geographical
  information systems
•  Formulating national policies for the management
  of geographical information
• Strengthening local capacities in the area of
  geographical information systems
• Improving access to geographical information
• Conducting studies on the use of geographical
  information systems in policy formulation
• Supporting the African satellites projects.

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III. STRATEGIES FOR AFRICA IN THE NEW
INFORMATION AGE

• Information services (libraries, archives and
  documentation centres)
• Information services encourage economic, social
  and human-resource development and help promote
  intellectual freedom and the preservation of
  democratic values and civil rights
• Information services are a means of reducing the
  existing divide between the infos rich and the
  infos poor (specially Public libraries)
• Public information services can also be very
  useful to small-and medium-sized enterprises and
  industries

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MERCI