Uganda Investment Authority UIA FUTURE OF ICT

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Uganda Investment Authority (UIA) FUTURE OF ICT
THE SERVICES SECTOR ITS IMPLICATIONS FOR THE
KAMPALA INDUSTRIAL BUSINESS PARK (KIBP)

• Kafu Hall, Serena Conference Center
• 6th Nov. 2006
• By Ignatius Kakembo-Ntambi
• CEO, Latest Technology International Limited
• Tel [phone]-436 561
• Email kakembon_at_yahoo.com/ ikntambi_at_lti.co.ug

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Background

• The KIBP - An intelligent government intervention
  into business processes in the selected 6
  business clusters.
• Objective To identify the infrastructural needs
  of the ICT Services sector other support
  needed from government for the sector to emerge.
• The challenge What are the most appropriate
  government interventions (non-financial!) to
  enable the identified 6 sectors emerge?
• Members Invited to debate and identify enablers
  to satisfy the demands of the businesses to
  facilitate their emergence.

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Introduction

• ICT is an industry in its own right and an
  enabler of other sectors of the economy.
• Uganda is Land-locked, not e-locked.
• Todays digital watch has more processing power
  than all the computers of the 1950s put
  together!!!

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ICT Policy (2004)

• Government recognises the important role played
  by ICT is commitment to champion the
  development use of ICT in Uganda
• Vision National development driven by efficient
  utility of ICT
• Goal Achieve quantifiable impact throughout
  Uganda within 10 years
• Objectives 14 Policy objectives

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ICT Master Plan for e-governance (by Mega-Tech
Aug06, funded by US Trade Dev Agency) 1.
Foundation - Establish Foundation (2006-07)

• Establish NICTS as Program Management Office for
  ICT
• Establish Agency Counterparts
• Define and approve target architecture
• Establish coordinated budgeting and capital
  planning processes

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(Cont.)2. Adoption - Drive Adoption and
Utilization (2008-09)

• Transition to target architecture
• Implement/Maintain Common Solutions
• Promote and cultivate technical staff

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(Cont.)3. Transformation - Realize Government
Wide Transformation (2010-2011)

• Extend network (MPLS)
• Expand ICT solutions
• Pursue Additional Collaboration Areas identified
  in National ICT Strategy
• What is on the Ground?

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What is on the ground?

• There was an attempt thru the World Bank
  sponsored Infrastructure Agenda Project to
  estimate the no. of PCs in use in Uganda in 2002.
• Could be 50K or more today!!(?). There is need to
  establish the current level of computerisation in
  the country.
• E-government study established those in govt in
  2005 at approx 17K!
• Private sector esp. Financial, leisure
  insurance have computerised many of their
  operations!

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COMMUNICATIONS SECTOR COMPARATIVE FIGURES FOR THE
PERIOD DECEMBER 1996 TO JUNE 2006 (UCC Website,
comperative figures for PCs not available)
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Who are the major players in the ICT Sector in
Uganda?

• Government for Policy, Legal Regulatory Frame
  works, manpower, etc
• National Regulators (UCC, NPA, NITA, BC, IMC)
• UIA for Investment and ICT Strategic Intervention
  Programs
• UNCST

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• Public and Private Education Institutions. for
  skills development
• National Telecom Operators for backbone
  infrastructure and Connectivity. (uganda telecom,
  MTN, Celtel, etc)
• VSAT International Data Gateway Operators
• PSP ISPs

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• Public Internet Access Providers (Cyber cafes)
• FM Radio Stations
• Private Television Stations
• Private Radio Communications users

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• Courier Services Providers
• National Postal Services Operators
• Networked Society
• Computer Systems Suppliers (hardware software
  vendors)

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Regulatory Framework Investment Climate Issues

• Zero taxes incl. VAT on import of some ICT
  equipment
• Tax exemption needs to be extended to all ICT
  equipment
• What more?

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Industrial Clustering The Theory

• No coy captures all the economic benefits of its
  innovation process
• Spillovers can be captured by other coys
• Geographical proximity of coys increases the
  potential of capture and
• A supportive local infrastructure nurtures the
  process.

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ICT Services Sector Cluster is Knowledge-Based

• Could be
• region (Silicon Valley, USA)
• technopole (Ottawa, Canada)
• industrial research park (Hsinchu, Taiwan)
• business industrial promotion (India et al)
• Common features proximity and linkages among the
  players.

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Operational Units within the ICT Services
Sector Cluster

• Technology Transfer
• Business Development Market Enabling
• Incubation Center
• IT Center for Industry
• Research Development
• Specialised Programs set up with technology
  business partners like centers of excellence for
  computer security, database technology competency
  center, software standards, etc
• Technical business infrastructure including
  office space

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Overall Activities of the ICT Services Sector
Cluster at the KIBP

• Data Entry, Call Centre Software process
  improvement
• Market enabling visits, networking functions,
  missions
• Business match-making
• Funding coordination (thru venture capital
  investor, angel investors, banks, etc.)
• Business and legal information service
• Back Office operations Software start-up
  incubation

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• To nurture technology ideas into commercial
  successes
• To provide workspace supportive environments to
  ICT entrepreneurs at startup during early
  stages of their businesses
• To enlist support from successful business people
  to act as mentors, judges, instructors, etc to
  new start-ups.

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• Formal training (technical and non-technical)
• Seminars/ conferences/ workshops
• Exhibition/trade events
• Excellence/competency centers operation
• Technology community events

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Support of Specific Local Strengths and Assets

• Technological strengths (universities, government
  research institutions and major firms)
• Local market strengths (e.g. government
  procurement, banking)
• Social, cultural and entertainment infrastructure
  are important assets because skilled people are
  Foot-Loose and migrate to areas with good
  quality of life.

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Components of a successful ICT Services Cluster

• 1. ICT Champions are Important that have
  Entrepreneurial Drive
• Central to firms and cluster development
• Individuals whether they are growing firms or in
  supporting organizations and
• Where it is weak clusters stagnate.

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Components of a successful ICT Services Cluster
(Cont)

• 2. Funding Need Various Sources of Financing
• Full spectrum of funding instruments is needed
• Angel and venture capital and government funds at
  the start-up phase and
• Debt/equity instruments for the growth where 1
  of working capital is needed to support 1 of
  sales.

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Components of a successful ICT Services Cluster
(Cont)

• 3. Information Networks which can be
• Informal where the focus is on the transfer of
  tacit knowledge
• Formal (e.g. ICT Industry Associations, Chambers
  of Commerce, Govt institutions)
• Where such structures are weak clustering suffers

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Components of a successful ICT Services Cluster
(Cont)

• 4. Educational Research Institutions
• Necessary to provide skilled people and
  technological expertise
• But, not sufficient for success unless there are
  strong linkages to industry (e.g. Silicon
  Valley) and
• Where linkages are weak clustering stagnates

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Components of a successful ICT Services Cluster
(Cont)

• 5. Staying Power
• It can take 10 () years for a cluster to reach
  maturity
• Growth can be supported through sustained
  government support and
• Growth can also be accelerated by attracting
  investment by multinational companies.

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Vision of the KIBP for the ICT services sector

• To put in place a sustainable 1st rate facility
  that supports entrepreneurs to create world class
  ICT services as well as make ICT an enabler for
  the other sectors in the Ugandan economy.

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What KIBP can bring to the ICT Services Sector

• Provide a facility for ICT business incubation
  for export-oriented ICT firms in Uganda for data
  entry, call centres, and software development.
• Improve quality standards of local ICT companies
  to international levels-through software process
  improvement frameworks.
• Promote transfer of relevant technologies for the
  software industry - directed at professionals and
  management levels.

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• Promote capability building for mature companies
  and incubation of new start-up ICT entrepreneurs.
  
• Promote new market opportunities for local
  software businesses at domestic and international
  levels, including business match-making,
  collaboration, finding new market channels
  funding sources.
• Promote use of IT, especially through use of
  appropriate software, in all sectors of the
  economy to increase productivity and
  competitiveness

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Facilities required for the ICT Services Sector
in KIBP

• Intelligent Building with High Speed Broadband
  Internet connectivity
• Continuous Power supply on 24x7 basis (solar,
  wind)
• Fully enabled Incubation marketing
  functionality
• Design KIBP as an intelligent facility with
  Broadband Internet availability everywhere
• Provide meeting rooms/ conference facilities,
  entertainment, sports, etc

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Conclusion

• Success of ICT services cluster is based on
  private sectors (both entrepreneurs and vendors)
  continuing support of its operations
• The KIBP will provide the initial experiences for
  the govt in getting directly involved with hitech
  niche areas of the ICT industry. It will provide
  a very good basis for evaluation to measure the
  performance of its many roles.
• This will enable further focusing of ICT services
  not only for export services but also in
  addressing the needs of local businesses,
  industries agriculture especially the 6 key
  clusters present in KIBP.

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Conclusion (cont.)

• On successful implementation of KIBP, there will
  be opportunities for duplication of a similar
  effort in other parts of Uganda for the different
  sectors.
• The ICT Cluster will get software and other
  service providers involved deeper and enable
  faster growth and competitiveness of other
  business sectors in Uganda.
• Will enable the government to understand the
  business needs of the sector and be able to come
  up with appropriate responses in a timely fashion.

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Finally

• Thank you good Brainstorming!