ECA ITU

1

• ECA ITU
• Joint ECA -ITU-Issues Paper on the impact of ICTs
  on Employment and Poverty Alleviation in Africa
• (Opportunities and challenges)
• Draft report
• Moses Ubaru
• mubaru_at_nitda.gov.ng
• moses_ubaru_at_yahoo.com

2
Presentation Outline

• Brief Introduction
• Objectives
• Methodology
• Case studies
• Recommendations
• Conclusion

3
Introduction

• This report outlines the findings of desk
  research and consultations in selected African
  countries on the impact of Information and
  Communications Technologies (ICTs) on employment
  creation and poverty alleviation.
• The countries covered under the study are Egypt,
  Ethiopia, Kenya, Mozambique and Nigeria.

4
Introduction

• The objective of the study
• is to prepare an Issues paper on the impact
  of ICTs on Employment and Poverty Alleviation in
  Africa with an emphasis on
• ICT as an economic sector with capacity for
  generating huge employment opportunities and for
  contributing to rapid economic growth and
• ICT as a sector to leverage the growth and
  competitiveness of other African economic sectors
  
• The study therefore seeks to answer such
  questions as what jobs should be created?, in
  which sectors?, the role of Governments and the
  private sector in job creation?, what strategies
  are needed for the creation of such jobs?, and
  what resources could be used to attain a given
  level of employment?

5
Introduction

• METHODOLOGY
• Three stage approach
• Desk research using the internet and available
  documentation. This served to generate a
  knowledge base about the general ICT situation in
  the region.
• The research was followed by contacts made with
  key informants in the region for leads, pointers
  and further background documents.
• Then gathering information through interviews
  with the key stakeholders from the public and
  private sectors and ICT users in Ethiopia, Egypt,
  Kenya, Mozambique, and Nigeria

6
A Case Study of Egypt

• Socio-economic Background
• Egypt occupies the northeast corner of the
  African continent
• Population of the as at 2006 was put at
  78,887,007 (July 2006 est.)
• GDP per capita of 4,200 (2006 est.). The country
  presently has industrial growth rate of 5.1
  (2006 est.) with 21.8 million (2006 est.) labor
  force.

7
A Case Study of EgyptContd

• The ICT landscape in Egypt
• Egypts telecommunications sector began a journey
  of reform in 1998.
• The Ministry of Communications and Information
  Technology (MCIT) established in 1999 to lead
  Egypts transition into an information Society,
• while the National Telecommunications Regulatory
  Authority (NTRA) was empowered by the
  Telecommunication Act No. 10 in 2003 to act as
  the independent regulatory authority overseeing
  the telecommunications sector in Egypt.
• ICT Sector reform was quickly followed by the
  privatization of the mobile phone sector.
• National ICT plan adopted in 2000

8
The ICT landscape in Egypt

• There have been momentous leaps forward in the
  ICT development in Egypt between 2003 and now.
  These include
• Internet users in Egypt jumped from 2.7 million
  to 5 million between December 2003 and July 2005,
  
• Broadband services subscribers about 68,000.
• Fixed line subscriptions rose sharply from 8.8
  million to 10.1 million between 2003 and 2005,
  while
• during the same period mobile phone subscriptions
  increased almost twofold from 5.8 million to 11.2
  million.
• IT clubs, for IT training and usage accessible to
  youth in underdeveloped areas, more than doubled
  from 618 to 1,244 in less than two years.

9
The following chart illustrates the rapid
development of ICT in Egypt between 2003 and
2005
10
A Case Study of EgyptContd

• Introduction of competition
• 7 data carriers and facility-based Internet
  service providers (ISPs) have been licensed
• over 214 service-based ISPs lease infrastructure
  and compete in the provision of content to users
• Also 2 prepaid calling card operators were
  licensed in 2004 to compete with Telecom Egypt on
  the provision of national, mobile and
  international services
• 2 payphone operators were licensed to compete
  for the provision of payphone services throughout
  Egypt in competition with Telecom Egypt on
  facility-basis.
• 2 VSAT operators and several international GMPCS
  operators have also been licensed to provide
  satellite services in Egypt

11

• The following chart maps the dramatic increase of
  mobile and fixed line telephone subscribers in
  Egypt from 1998 to 2005 when number of mobile
  subscribers have surpassed the number of fixed
  line subscribers

12

• At around 15.4 mobile penetration, the market
  remains fertile ground for potential investors.
  The Egyptian mobile market still has a
  significant room for growth which favors the
  entry of at least a third mobile operator. NTRA
  is preparing for issuing of a third mobile
  license.

13
Introduction of competition Contd

• The story here is that liberalization and the
  resulting
• competition has helped to accelerate the growth
  of
• the ICT sector in Egypt

14
A Case Study of EgyptContd

• Universal Service
• Egypt has put in place a universal access
  mechanism to ensure equal access for rural users
  to telecommunications services that are
  comparable in price and scope to those available
  in urban centers.
• ICT and Poverty Alleviation in Egypt
• Traditionally poverty has been defined in terms
  of per capita income. The World Bank report
  however, goes beyond the view of income levels in
  its definition of poverty, suggesting that
  poverty includes powerlessness, voicelessness,
  vulnerability and fear (World Bank Report
  2001-2002).
• European Commission adds the deprivation of basic
  capabilities and lack of access to education,
  health, national resources, employment, land and
  credit, political participation, services and
  infrastructure (European Commission 2001).

15
A Case Study of EgyptContd

• Typical example of the use of ICT for poverty
  alleviation in Egypt include
• The free internet programme.
• Improved access to government services
• IT clubs
• Capacity Building (Human Resources) Initiatives
• In recognition of the fact that the availability
  of the right skilled manpower is what drives
  development in the modern information society,
  Egypt has laid a lot of emphasis on capacity
  building. Examples include
• the Illiteracy Eradication Programme,
• the Basic Skills Development Training Programme,
• the smart schools programme, etc
• The MCIT s target has been to produce 5000-6000
  highly professional ICT personnel for the market
  annually in a five-year period through various
  strategic alliances and miscellaneous programs.

16
Capacity Building (Human Resources) Contd

• Several institutions involved in capacity
• building include
• The National Telecommunication Institute (NTI)
• The Information Technology Institutee (ITI),
• Regional Information Technology and Software
  Engineering Centre (RITSEC).
• The Regional Information Technology Institute
  (RITI)

17
ICT and Employment Generation in Egypt

• Egypt has seen huge growth in the ICT sector in
  the last few years.
• The number of companies in the ICT sector in
  Egypt exceeds 1,570
• The companies employ approximately 35,000
  MCIT-Information Society
• Agriculture is one of Egypts largest employment
  industries, and whilst it is a low technology
  sector, policy has been implemented to offer
  related services through various web portals.
• Creating jobs through IT clubs
• Over 4000 jobs have been created in various
  governorates in Egypt through the IT club
  initiative of MCIT.
• Each IT-Club has a minimum of three staff, the
  manager, and two technical support assistants
  that live near the local community.

18
ICT and Employment Generation in Egypt Contd

• Job creation through ICT Outsourcing in Egypt
• Egypt is gradually positioning itself as a major
  Outsourcing destination and a number of
  employments are already being generated through
  the call centre programme
• Regional Expansion of Egyptians Telecom Companies
• As a result of the huge pool of skilled ICT
  personnel in Egypt, Egyptian telecommunications
  companies are expanding beyond the shores of
  Egypt

19
ICT and Employment Generation in Egypt Contd

• Job Creation through the Mobile Phone Services
• Two mobile phone operators Vodafone and
  MobiNil
• Generation of approximately 5,000 direct jobs and
  15,000 indirect jobs
• Investments worth 10 billion LE by the two
  mobile phone service companies
• Government proceedings of nearly 7.4 billion
  LE
• Development of Egyptian know-how in the fields
  of design, establishment, and maintenance of
  2/2.5 G networks
• In short, the GSM industry is contributing
  tremendously to the growth of the Egyptian
  economy.
• The PC ownership Schemes and Job creation
• A number of jobs have been created through the
  PC for community and the Laptops for
  professionals programmes. Well over 500
  distributors, sales outlets, services and
  maintenance centres have been created as a result
  of these schemes

20
ICT and Employment Generation in Egypt Contd

• Female Employment in ICT
• Telecom Egypt has seen a steady increase in its
  qualified women engineers in the last five years.
  Also the number of women holding leadership
  positions was also continuously rising in this
  time except for the year 2001 as many of them
  reached the retirement age. The National Telecom
  Institute showed that the percentage of women
  engineers ranges between 64 to 68 percent out of
  the total number. Within its academic positions
  more women continue to occupy departmental
  leadership positions.
• MobiNil witnessed a remarkable increase in the
  number of women engineers between 2002 and
  2003.The percentage of women working for the
  different company departments ranges from 35
  percent to 38 percent, including women who held
  non engineering posts.
• The next slide illustrates the trend for
  education and employment of women in the ICT
  industry.

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22
ICT and Employment Generation in Egypt Contd

• Job Creation through e-Agriculture Programme.
• In collaboration with the Food and Agriculture
  Organization (FAO), Egypt implemented the Virtual
  Extension Research Communication Network (VERCON)
  which provides the platform for information
  sharing between agricultural researchers and
  extension workers.
• Currently there are already 57 nodes in the
  network (5 in central and 52 in 6 governorates).
  The target is to have 163 sites in 15
  governorates by mid 2007.
• The network had already created jobs for over
  1000 workers including 92 extension workers, 12
  researchers, and other workers involved in
  content development. It has also contributed
  tremendously to empowering farmers with relevant
  information to boost their productivity and
  profitability.

23
ICT and Employment Generation in Egypt Contd

• Software Industry, IT services and Job Creation
• Technology parks and incubators and skilled
  human resources are the major engines of growth
  behind the Egyptian software industry. The
  software industry is the fastest growing segment
  among the Egyptian IT segments.
• Egyptian software exports were estimated at 500
  million in 2005.
• The number of companies working in the software
  industry is nearly 300 with 7000 professionals
  employed in the industry.
• IT services market generated 210 million in
  revenue representing almost 29 percent of the
  total Egyptian IT market.

24
A Case Study of Kenya

• Socio-economic Background
• The population of Kenya is presently estimated to
  be 34,707,817(July 2006 est.)
• GDP per capita is put at 1,200 (2006 est.).
• The countrys industrial growth rate is 6.3 with
  a labor force of about 1.955 million (2006 est.),
  agriculture 75 industry and services 25 (2003
  est.)

25
Socio-economic Background Contd
26
Overview of the ICT sector

• The telecommunication sector in Kenya is the
  responsibility of the Communication Commission of
  Kenya (CCK)
• Prior to 1998, the Kenya Posts and
  Telecommunication Corporation (KPTC) was the sole
  provider of basic telecommunications services.
• In 1998, a modern regulatory regime was
  established by the Kenya Telecommunications Act,
  which set up the Communications Commission of
  Kenya (CCK) an independent industry regulator.
• Telkom Kenya was created in 1999 as a separate
  legal entity from the previous postal and
  telecommunications statutory body and is slated
  for privatisation, but this has been a very slow
  process.
• Only Telkom Kenya has the license to operate a
  commercial International VSAT service.

27
Overview of the ICT sector

• Second National Operator (SNO) yet to be
  approved
• Nevertheless, the telecommunication sector as a
  whole has been liberalized and there are private
  companies entering the market.
• Currently, there are two private telephone
  companies, Safaricom and Celtel. As a result, the
  number of telephone subscribers has risen rapidly
  over the past six years.
• In June 1999, Kenya had 15,000 mobile phone
  subscribers. By the end of 2005, there were more
  than 4.6 million subscribers.
• Table 1 summarises the development of the
  Kenyas ICT landscape over the period 1999 to
  2006.

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29
ICTs, employment and poverty alleviation in Kenya

• ICTs and the Poverty Reduction Strategy Programme
  (PRSP)
• The Kenyan Economic Recovery Programme (ERP)
  designed to replace the Poverty Reduction
  Strategy Programme (PRSP) recognizes and
  emphasizes the need to develop the ICT sector as
  a major contributor to socio-economic
  development.
• It does not however, emphasize the cross cutting
  effect of ICT and the need to mainstream ICT in
  the various sectors of the economy.
• The ERP document stresses job creation and
  poverty reduction as the priority of all
  government development efforts.

30
ICTs, employment and poverty alleviation in Kenya
Contd

• GSM and Poverty Alleviation
• The introduction of GSM in Kenya has helped in
  the Alleviation of poverty in the country as the
  following example illustrates
• Sokoni-SMS Empowering farmers through SMS
  market price service
• The Kenya Agricultural Commodity Exchange (KACE)
  is a private-sector firm
• launched in 1997 to facilitate linkage between
  sellers and buyers of agricultural
• commodities
• provide relevant and timely marketing
  information and intelligence
• provide a transparent and competitive market
  price discovery mechanism and
• harness ICTs for rural value addition and
  empowerment.
• KACE launched an SMS-based information
  serviceSokoniSMSfor farmers.
• The SokoniSMS service enables farmers to receive
  market prices in various market centres around
  the country through their mobile phones. Equipped
  with this information, the farmers are able to
  determine the most profitable market centre to
  transport products to and circumvent middlemen
  who usually offer to buy the products at much
  lower prices.

31
ICTs, employment and poverty alleviation in Kenya
Contd

• The Arid land information network for
  pastoralists and farmers
• The Arid Lands Information Network (ALIN)
  provides farmers and pastoralists
• in drought prone areas of Kenya with information
  for sustainable livelihoods.
• ALIN is integrated into the global Open Knowledge
  Network (OKN) through the access points which are
  set up in the dry lands around the country from
  where Community Development Workers (CDWs) and
  community members can access information on
  sustainable farming best practices and share
  experiences and ideas.
• Each access point uses WorldSpace satellite
  radio receiver with multimedia facilities to
  enable users to download specific content via
  satellite. .
• Community members and CDWs converge at the access
  point for relevant information, and experience
  sharing which may include farming practices,
  veterinary advice and accessing the downloaded
  national newspapers, including the Daily Nation
  which do not get to these remote areas. The CDWs
  also access information on behalf of the
  community members and share the information
  during their focus group meetings.
• By partnering with other organizations in the
  OKN, ALIN has enabled the geographically
  dispersed communities to share information via
  ICTs.
• From the information obtained at the access
  point, community members are able to make
  informed decisions that improve their farming,
  health and other livelihood practices.

32
ICTs, employment and poverty alleviation in Kenya
Contd

• Lake Victoria Environmental Management Project
  (LVEMP)
• The project uses ICTs in the form of geographical
  information systems (GIS) to
• create and update a scientific and
  socio-economic database on the current status of
  Lake Victorias forest growth, land-use
  practices, pollution and water quality, among
  others.
• The government is thus able to make informed
  decisions on improvement of conditions in and
  around the lake. A significant gain from this has
  been the 80 per cent reduction in water surface
  coverage of water hyacinth leading to resumption
  of fish exports to the European Union. Fish
  exports from Kenya to the EU was originally
  banned under stringent pollution and processing
  standards of the European Commission. The
  ICT-enabled gains in income due to improved
  environmental protection that has resulted in
  increased consciousness of the direct linkages
  between the information society and sustainable
  development.
• After learning more about the water hyacinth,
  many enterprising people around
• the lake have learned to earn a living from
  the infamous weed by drying it and
• making mats and baskets for sale. Similar
  initiatives could be replicated for other lakes
  and dams in Kenya.

33
ICTs, employment and poverty alleviation in Kenya
Contd

• ICT in Government and other institutions
  (parliament, universities, research institutions,
  etc.)
• The directorate of e-Government, Kenya was
  established under the presidency in 2005 to get
  all Government services online by providing all
  MDAs the necessary guidelines and support to make
  their services available online.
• In period 2005 2006 the directorate focused on
  the provision of infrastructure. All the MDAs and
  the state house in Nairobi now have structured
  cabled LANs with about 18,000 points in all.
• The MDAs are interconnected with leased lines
  from TDM, and with wireless backup. The provision
  of fibre optic links for the MDAs is ongoing.
• The second phase of the e-Government programme
  which commenced from 2007 will focus on
  provision of services. Already a number of
  services could be accessed online such as
  checking of examination results, advertisement of
  vacancies by the public service commission and
  the filling of application forms online, and
  tendering online.
• The Ministry of finance has been the first major
  user of the e-government ICT infrastructure. To
  accelerate the adoption of ICT in the MDAs,
• IT departments have been created in all the MDAs.
  
• According to the director, Dr Okech, there are
  about 450 IT staff in the IT departments out of
  which 130 are young graduates hired in 2005.
  These according to him are definitely not enough
  for the work at hand.

34
ICT for Employment Kenya

• SMEs
• A very useful interactive meeting with the
  Telecommunications Services Providers Association
  of Kenya (TESPOK) reveals the existence of
  several Small and Medium Enterprises (SMEs) in
  the ICT industry with staff strength between 5
  and 100.
• For instance Kenya Data Network (KDN) has a staff
  strength of 92, and employs the services of 12
  other contractors in executing her jobs,
• SahaNet (33 employees), TodaysOnline (26
  employees), Flashcom (52 employees), SIMBANet (60
  employees), Kenyaweb (64 employees) just to
  mention a few.
• These organizations are involved in providing
  services ranging from ISP,
• Data network services, ICT Training, and
  consultancy services.

35
ICT for Employment Kenya

• SMEs
• Indirectly, the development of the ICT sector
  has led to creation of a lot of employment in the
  informal sector and has led to a few SMEs
  springing up.
• A few example include
• the ecosandals business,
• the Business Process Outsourcing,
• the Pre-paid card services kiosks, and the phone
  charging business.
• And according to Dr Kulubi, with many FM
  community radio stations springing up, a lot of
  people are getting employed, and more rural
  people are purchasing radio sets and getting
  better informed.

36
ICT for Employment Kenya Contd

• The Ecosandals example
• Through the use of the Internet to source for
  market, Maina and his team began to export
  sandals made from condemned tires to United
  States and Europe. On the average, the firm now
  exports over 1,000 pairs of sandals each month,
  at a cost of 13 to 15 dollars. These sales have
  substantially improved the lives of its workers

37
ICT for Employment Kenya Contd

• Business Process Outsourcing
• Kenya has a comparative advantage in the BPO
  market due to low priced but high quality labour
  force, strong cultural links to Europe and the
  USA, strong work ethic and service oriented
  culture, and strong language skills and strategic
  location and favourable time zones. The
  implementation of the undersea optic cable is
  expected to lower the Call Centres costs,
  particularly those associated with access by over
  70 per cent. This is expected to spur growth in
  the sector as more business outsourcing solution
  platforms can be provided at affordable costs.
• The BPO sector currently employs about 1,000
  people and the five major players are Kencall
  (400 employees), Skyweb-Evans (100 employees),
  Preciss International (20 employees),
• Kentech Data (20 employees), Oriak Digital
  (20 staff)

38
ICT for Employment Kenya Contd

• Business Process Outsourcing
• Following are the identified major bottlenecks
  limiting growth in the BPO sector
• High licensing fees The current licence fee of
  Kshs100,000 for call centres is a barrier to
  market entry.
• Lack of national standards for BPO
• .
• High infrastructure costs
• .
• Access to finance for start-up / expansion of
  BPO operations The business is new to banks and
  this makes it difficult to acquire financing
  through bank loans.
• Marketing More Government support is necessary
  to market Kenya as a BPO destination.
• Perceptions about the region The East African
  region is not perceived as BPO destination. This
  coupled with perceptions on insecurity and
  corruption puts Kenya at a disadvantaged
  position.
• Shortage of high level / specialist ICT skills
  
• A lot of capacity building is required to
  produce the critical mass of IT skilled manpower
  required to develop the sector

39
A Case Study of Nigeria

• Demographic Data
• Population
  140m.
• Annual Growth rate
  2.38
• Economy
• GDP per Capita
  1,400
• Nature of Economy
• Petroleum (oil gas) dominated, accounting
  for over 80 of Federal Revenue Agriculture
  Manufacturing less dominant vibrant informal
  sector

40
Key Facts about Nigeria Contd
41
Overview of the ICT Sector in Nigeria Contd
42
ICT and Poverty Alleviation in Nigeria

• The PRSP
• The National Economic Empowerment Development
  Strategy (NEEDS) is Nigerias home-grown poverty
  reduction strategy. A medium term framework
  (2003-2007) which builds on Nigerias past
  economic development plans targeted on poverty
  eradication, wealth creation, employment
  generation and value re-orientation.
• The document hardly mentioned anything about ICT
• However, it is being revised and the cross
  cutting effect of ICT for development would be
  reflected

43
ICT and Poverty Alleviation in Nigeria

• Visible areas of impact of ICT on poverty
  alleviation in Nigeria include
• Improved access to education through the IT
  driven National Open University, Nigeria (NOUN)
• Improved access to government services
  eGovernment services

44
ICT and Employment in Nigeria

• The impact of ICT on employment and poverty
  eradication cannot be over emphasized in that it
  now plays a key role in education, learning,
  research, agriculture, health, trade and
  commerce.
• The growth in the ICT sector in Nigeria from
  1999 to date has touched several aspects of life
  of Nigerians.
• Foreign Direct Investment has increased
  especially by service providers. This is over 8
  Million.
• New employment has been generated through people
  that have been directly employed either at the
  white collar job level or the small and medium
  scale enterprises as a result of the deregulation
  of the ICT sector.
• The deregulation of the sector has created a lot
  of opportunities including the emergence of many
  private broadcasting firms, private telephone
  operators, Internet service operators,
  Information Technology (IT) firms, Support
  services like Telecentres, Cybercafes, Recharge
  cards producing companies, Prepaid card
  companies, Consulting firms etc.
• In the commercial market, the sector has provided
  self employment for the dealer that deal on the
  telephone accessories. It puts food on the table
  of a lot Nigerian engaged in the industry.

45
ICT and Employment in Nigeria Contd

• ICT and Job Creation through Telecentres in
  Nigeria
• ICTs have assisted Nigeria in the reduction of
  unemployment rates at national, urban and in
  rural areas of Nigeria. Through the establishment
  of rural information centers in most parts of the
  country,
• ICTs have created employment opportunities in
  rural areas by engaging telecentre managers,
  subject matter specialists, information managers,
  translators and information technology
  technicians.
• Such centers have helped to bridge the gap
  between urban and rural communities and reduce
  the rural-urban migration problem. The centers
  have also provided training and those trained
  have now become small-scale entrepreneurs in
  their respective areas. Thousands of the poor
  Nigerian has also benefited from telephone
  service through sales of either accessories or
  Telephone calls (make calls, receive calls)

46
ICT and Employment in Nigeria Contd

• ICT and Job Creation through the GSM
• The level of job that the telecommunications
  sector in Nigeria has created is enormous
  especially with the employment requirement of the
  service providers and at the Small and Medium
  scale level. Many Nigerians now are into
  Computers, GSM and their accessories sale and
  repairs while others set up telephone call
  centres as their major source of income.
• The level of employment generation in the
  informal sector like the Otigba market in Lagos
  (the largest informal ICT market in sub Saharan
  Africa) and various others scattered all over
  Nigeria are enormous.
• Tthe GSM "umbrella people" who, in many towns
  across Nigeria, resell GSM wireless services,
  most notably by selling phone calls. With an
  umbrella to mark their stand, a Subscriber's
  Identification Module (SIM) card and handset,
  they are ready for business. GSM resale has
  become a viable employment opportunity for
  hundreds of young Nigerians. It has even become
  quite lucrative. In an economy where the average
  monthly Gross National Income per capita stands
  at 24.17 USD, umbrella people can net up to 15.40
  USD per day.

47
ICT and Employment in Nigeria Contd

• ICT and Job Creation through the GSM
• Over 10,000 people directly employed by the GSM
  operators alone
• Estimated 1,000,000 indirect employment
  opportunities created through the operation of
  GSM (Recharge card hawkers, Resellers etc
  including the umbrella people)
• Opportunities for Nigeria workers to serve as
  expatriates to other
• countries (Foreign input to GDP).
• Large number of franchised dealers nationwide
• Estimated indirect employment over 400,000
• Nigerian ICT professionals being attracted Home
• --Contribution to Nigerias GDP 1-3 increase
• Source NCC (2006)

48
ICT and Employment in Nigeria Contd

• ICT and Job Creation through In-sourcing
• A typical example of how ICT could create jobs is
  that of the Teachers Registration Council of
  Nigeria (TRCN) where over three hundred people
  are engaged in the data capture under the
  National Teachers Registration and
  computerization scheme.
• Using a computer laboratory equipped with 100
  computer systems and three servers, three hundred
  data entry operators working in three shifts of
  100 per shift are involved in the capturing of
  teachers records with supervisors and managers
  cross-checking and validating the entries.
• It is clear from this example that if the
  federal government comes up with a policy that
  mandates all the ministries to capture all their
  files in electronic format before a certain date
  as a necessary pre-requisite in preparation for
  e-Government implementation, that a lot of jobs
  will be created for the data entry operators.

49
A Case Study of Mozambique

• Socio-economic Background
• Mozambique is located on the eastern coast of
  southern Africa. It has eleven provinces Cabo
  Delgado, Niassa, Nampula, Tete, Zambezia, Manica,
  Sofala, Inhambane, Gaza, Maputo Province and
  Maputo City. The country with an area of just
  over 790,000 sq. km has a population estimate of
  about 20.366.795  (2007).
• Mozambique is a country of great potential and
  many contrasts.
• Its population is strikingly young, with 10
  million children accounting for half of the total
  population of 20 million.
• Around 70 per cent of Mozambicans live in rural
  areas, where the majority ekes a living from
  subsistence farming.
• Recurrent drought in the countrys interior,
  however, has led people to migrate to urban and
  coastal areas with adverse environmental
  consequences, such as desertification and
  pollution of surface water.
• While Mozambiques income per capita is US 310,
  well below the sub-Saharan average of US 754,
  the country has emerged as one of Africas most
  successful examples of post conflict
  reconstruction and economic recovery.

50
Overview of the ICT sector

• The telecommunications law and the policy of the
  telecommunications sector were approved by the
  council of ministers in 2004 while the National
  ICT policy together with the implementation
  strategies were approved by the council of
  ministers in 2002
• The telecommunications sector in Mozambique is
  organized as follows
• The Ministry of Transport and Communications
  (MTC) is responsible for the definition of the
  sector policy and development strategy
• The National Institute of Communications of
  Mozambique (INCM) is an independent entity,
  responsible for the regulation of the
  telecommunications sector, including licensing,
  monitoring and implementation of the policy
• The National ICT Policy Commission (NIPC) is an
  inter-ministerial body comprising MTC, Ministry
  of Education, and the Ministry of Planning and
  Finance, chaired by the Prime Minister and is
  responsible for providing leadership direction
  for all ICT initiatives.
• The Telecommunicaçoes de Moçambique (TDM) the
  incumbent operator still enjoys a monopoly of the
  basic telephony services for five years which
  ends 2007 December, after which TDM would be
  privatized.

51
Overview of the ICT sector Mozambique

• Universal Access (UA) Policy and Legislation.
• The Universal Access Policy is currently being
  developed. The draft policy seeks to achieve, in
  the long run, a reasonable access to all
  traditional and emerging information and
  communications services, including basic fixed
  voice telephony, e-mail, Internet and SMS, among
  others.
• The draft requires all operators and service
  providers who have obtained licence or
  registration from INCM to contribute to the
  Universal Access Service Fund (FSAU) through
  financial contribution, or direct investment in
  infrastructure or both.
• The INCM is expected to set up a Commission
  comprising operators, service providers,
  services users, representatives of government
  entities, etc which will advise on the most
  efficient ways of using and operating the funds

52
Technology Situation of Mozambique Contd

• ICT Companies
• There are around 50 ICT companies in Mozambique,
  only few of which actually focus on software
  application development. (www.cta.org.mz). Most
  of them focus on maintenance and selling of PCs
  including accessories. There are around 10 ISPs,
  most of them based in Maputo.
• There are two main GSM service providers in the
  country namely, Mcel and Vodacom.
• The ICT landscape as provided by INCM is
  summarized in the following table below
• The INCM record indicate that as at 2006, there
  were 24 Internet Service Providers (ISPs), about
  350,000 internet users, between 70,000 to 100,000
  PCs users and about 141 registered domain names
  in Mozambique

53
The is summary of ICT landscape as provided by
INCM
54
The Telecommunication landscape

• ISPs are currently not allowed to provide
  Voice over IP services under present law. (NO
  VoIP).
• There are currently no companies in Mozambique
  involved in the local manufacturing (assembling)
  of PCs.

55
ICT and Poverty Eradication (PARPA)

• The Action Plan for the Reduction of Absolute
  Poverty (PARPA II) was approved by the council of
  ministers on the 2nd of May 2002 and is intended
  to reduce the incidence of poverty from 54
  percent in 2003 to 45 percent in 2009.
• The three crucial pillars of PARPA II relevant
  to the present study are governance, human
  capital, and economic development.
• PARPA II in sections 220 to 230 recognized the
  cross cutting effect of Science and Technology,
  especially ICT and emphasized the need to exploit
  ICT for poverty reduction.
• Between 2001 and 2005, there has been remarkable
  achievements in poverty reduction based on such
  indicators as Consumption per family unit,
  Access to Education, Access to Health care,
  Access to public goods and services (Access to
  good roads, public phones, rural extension
  services etc), Access to private goods and
  services ( Access to modern lighting, portable
  water, modern sanitation etc).
• It is however extremely difficult, to quantify
  the contribution of ICT to the reductions in
  poverty due to lack of data and to the
  interdependencies among the action areas in
  fostering economic growth and reducing poverty.
• Following are few examples of the ICT programmes
  cited by the people interviewed that have
  definitely contributed to the poverty reduction
  in Mozambique

56
ICT and Poverty Eradication (PARPA) Contd

• Community Media Centres (CMCs)
• According to Polly Gaster the Coordinator of the
  CMC initiative, 17 CMCs, three Telecentres and
  forty (40) Community Radio centres, implemented
  through the assistance of donor organizations
  including UNESCO, would be in place by February
  2007.
• These centres which are owned by the communities
  are operated with the help of volunteers. The
  radio aspect of the programmes according to her,
  has proved to be more successful in meeting the
  needs of the communities.
• Because of high cost of connectivity, Polly
  Gaster expressed fears over the sustainability of
  the CMCs when donor assistance is eventually
  withdrawn.

57
ICT and Poverty Eradication (PARPA) Contd

• SchoolNet
• The SchoolNet programme has provided computer
  laboratories with Internet connection for
  thirteen schools in three regions,
• Has trained a number of teachers on the use of
  computers for education. Each school (with around
  400-500 students operating at three shifts per
  day) is equipped with 12-13 computers. The
  project includes higher secondary schools,
  technical, commercial and industrial schools as
  well as teacher training colleges (which prepare
  teachers for primary education).
• The SchoolNet project was able to build awareness
  on the importance of computers for education and
  to train teachers on the use of IT. A major
  problem at the moment is that content for
  teaching and learning is scanty. The ministry of
  education is has already embacked on a programme
  to develop the software for public high schools.

58
ICT and Poverty Eradication (PARPA) Contd

• E-Government
• The Government Network (GovNet) already
  interconnects about 15 government institutions in
  Maputo including government ministries and
  departments.
• The government services oriented portal is
  already in place but the websites of most of the
  ministries are however, very static and are
  mostly in Portuguese.
• There are a few that are in English such as the
  Ministry of Tourism.
• The ministry of Planning and Finance is in the
  process of extending her network to the provinces
  to enable the provinces access the integrated
  financial management system.

59
ICT and Poverty Eradication (PARPA) Contd

• GSM
• Like many other African countries were the GSM
  has been introduced, the GSM market in Mozambique
  is growing steadily. There are two major GSM
  operators in the country namely Mcel and Vodacom.
  
• Mcel has covered 80 districts with a combined
  population of 76 of the countrys population,
  although large tracts of land in all the regions
  are yet to be covered.
• Mcel coverage largely follows the areas of
  population concentration. The areas not covered
  are those with low population density and which
  are not commercially attractive.
• Vodacoms network coverage mirrors that of Mcel,
  though with fewer points of presence and less
  intensive build up in the high density areas
  outside Maputo.
• The networks have generated a lot of activities
  leading to small businesses such as GSM
  repairers, GSM credit resellers and have largely
  improved communication across the country.

60
ICT and Poverty Eradication (PARPA) Contd

• E-Health
• The Ministry of Health has established a health
  network linking three main hospitals in Maputo to
  the ministry and to four Provinces.
• Plans are being made to extend the network to all
  the ten provinces. The phase one of the project
  is basically the provision of infrastructure.
  Local area networks (LANS) are already being
  implemented in the various hospitals. Software
  applications for various services would be
  deployed in phase two.
• A trial tele-medicine service for HIV/AIDS
  patients is already on between Maputo and Tete.
• The field workers of the health ministry are
  already using palmtops in the field for gathering
  health data.
• Sixteen technical people were recruited last year
  for the project and screening has commenced for
  the recruitment of 22 more IT staff in the first
  quarter of 2007. To ensure the success of the
  e-Health scheme, plans are already on to retrain
  health staff on the use of ICT for their jobs.

61
ICT and Poverty Eradication (PARPA) Contd

• Mobile Internet Unit (MIU)
• One Mobile Internet Unit (MIU) has been built
  and is being used to create IT awareness and
  training. No data was available to indicate the
  level of impact of the MIU.

62
ICT and Poverty Eradication (PARPA) Contd

• Enhancing Education with ICTs
• According to the Ministry of education, ICT is
  already been used for school administration at
  national level.
• Data collection from schools has become much
  easier for the schools that are already
  computerized. Plans are on to provide e-mail
  facilities at the Provinces and eventually at the
  district levels to enhance statistics data
  collection from schools all over the country.
• ICTs have also been introduced into the secondary
  school curriculum since 2003 according to
• All the Technical and vocational schools already
  have administrative software while the software
  for the secondary schools is being developed.
• Two distance learning schools are at the
  experimental stage. These are currently providing
  correspondence courses but would soon be upgraded
  to make use of ICT for effective delivery of the
  courses.

63
ICT and Employment in Mozambique

• The development of the ICT sector in Mozambique
  has giving wing to direct and indirect
  employment.
• There is hardly any qualified IT skilled
  personnel in Mozambique that does not have
  employment.
• The general complain in the industry however, is
  that most of the graduates from the Universities
  in Mozambique are not well skilled for immediate
  employment.
• Inspite of that the IT firms still employ them
  and re-train them for six months to one year
  before they become productive on the job.
• In fact, there are testimonies that some
  students of the University of Eduardo Mondlane
  got employed and left school without completing
  their degree programme. This is a clear
  indication of shortage of skilled ICT personnel
  in the industry.

64
ICT and Employment in Mozambique

• GSM and job creation
• mCel has four major distributors and
  approximately 10,000 retail outlets selling
  pre-paid airtime cards.
• Vodacom uses twelve super dealers who manage an
  extensive network of resellers across the
  country. Thus the GSM industry has given wing to
  several pre-paid card kiosks business

65
ICT and Employment in Mozambique Contd

• Developing the ICT Workforce
• Among the principal challenges to developing the
  ICT workforce in Mozambique today are
• The existence of a very limited pool both in
  quantitative and qualitative terms of well
  qualified professionals in the area of ICTs
• Weak quality of training courses in
  informatics
• Absence of a vibrant national hardware or
  software industry to stimulate training and
  specialization in these areas
• Absence of professional requirements and of a
  system of evaluation and certification
  informatics courses

66
ICT and Employment Contd

• The Banking Sector
• Banks are usually the first adopters of ICT in
  most countries. There are currently over 10 banks
  in Mozambique, only one of which, BSTM (Banco
  Standard Totta de Moçambique) provides online
  banking services.

67
ICT and Employment Mozambique Contd

• ICT in Government (E-Government)
• The government generally performs its operations
  manually, although there are some isolated
  automated pockets. The government does have a few
  web pages but they are almost all quite static
  and non-interactive.
• The government can actually generate a lot of
  employment by leading the way in the deployment
  of ICT for her day to day operations.
• This could be done through the outsourcing of the
  ICT training of the government staff and the
  computerization of government operations to the
  private Mozambican ICT organizations.
• According to the Ministry of National Planning
  and Development, and the Ministry of Finance, the
  government has implemented the SISTAF a finance
  application for finance and budget management and
  planning. 60 of budgeting is already being
  carried out with SISTAF. Budget is available
  online. The usage of SISTAF would be made
  operational in 28 out of the 130 districts by the
  end of 2007.

68
ICT and Employment Mozambique Contd

• Business incubators, SMEs and job creation
• SMEs form a very significant part of business
  in Mozambique and require an understanding of how
  they can best use ICT for their own business
  development. The SMEs need a lot of training on
  how to make business plans and how to generally
  make their business succeed.
• The Business and Technology incubator has taken
  off at the CIEUM and provides tenants with
  business expertise (Business plan development
  skills, and entrepreneurship skills tailored to
  Mozambiques development challenges), access to
  appropriate facilities for take off, assistance
  with defining appropriate mix of services and
  assistance with raising funds for take off.
• According to Constantino Sotomane, five small
  companies have successfully passed through the
  Business and Technology incubation programme of
  the MICTI and are now on their own.
• The Science and Technology Park is expected to
  bring international technology business expertise
  to Mozambique, reinforce links between business
  and the ICT academic community and seed and
  nurture Mozambican innovation capacities

69
ETHIOPIA CASE STUDY

• Economic Background
• Ethiopia's economy is based on agriculture,
  accounting for about half of the GDP, 60 of
  exports, and 80 of total employment.
• The agricultural sector suffers from frequent
  drought and poor cultivation practices.
• The industrial sector accounts for 10 of the
  GDP, 15 of the exports and employs close to 2
  of the labour force

70
ETHIOPIA CASE STUDY

• ICT Landscape
• Monopoly with Telecommunication Corporation (ETC)
  as the National Operator
• Ethiopia Telecommunications Agency (ETA) as
  regulator
• Teledensity as at 2005 was at 0.83 per 100
  inhabitants, exclusive of mobile telephony.
• If we include the 410,630 mobile subscribers the
  penetration rate shoots up to 1.39 per 100
• The number of internet users rose from 75,000 in
  2003 to 113,000 in 2004 with 88 internet hosts

71
ETHIOPIA CASE STUDY

• ICT status at a glance (2005)

72
ETHIOPIA CASE STUDY

• A State-of-the-art multimedia broadband backbone
  infrastructure with a core nucleus of 4000km of
  optical fiber.
• The network connects all 600 of Ethiopia's local
  councils (woredas) to 11 regional capitals using
  a combination of fiber, microwave, wireless and
  satellite technologies.

73
ETHIOPIA CASE STUDY

• ICT Poverty Alleviation
• WoredNet Initiative
• This is a major e-government initiative that
  connects all 600 of Ethiopia's local councils
  (woredas) to 11 regional capitals through
  internet telephone and video-conferencing.
• The initiative also provides connectivity to the
  SchoolNet initiative, eHealth and the soon to be
  launched AgriNet.
• SchoolNet Ethiopia
• The joint initiative by the Ministry of
  Education and UNDP is probably the most visible
  project in the country with a total of 181
  schools equipped with a minimum of 15 networked
  computers per lab all connected to the internet.
• Distance Learning
• The Ministry of Education in collaboration
  with the Indira Gandhi National Open University
  in India has initiated a distance learning
  prgramme using video conferencing.

74
ETHIOPIA CASE STUDY

• ICT and job creation
• Not much data available but as in other
  countries Jobs are being created through
• Telecentres
• GSM and
• Training centres

75
RECOMMENDATIONS

• Following are very important areas where the
  African
• countries could focus efforts with a view to
  create
• decent jobs, reduce unemployment and alleviate
• poverty
• Outsourcing
• Community Multipurpose Telecentre (CMCs), using
  post offices as outlets, and combining several
  technologies- radio, GSM, Internet , TV, and
  multi-media
• Market driven e-Agriculture.
• Promoting ICT based SMEs through incubators
  franchising
• Cyberparks
• Software development

76
RECOMMENDATIONS contd

• Following are very important with respect to
  Poverty alleviation
• Review of education curriculum to meanstream ICT
  in education right from primary school and to
  emphasize entrepreneurship
• Encourage life-long learning, distance-learning,
  e-learning, and re-skilling
• CMCs and Community radio

77
RECOMMENDATIONS

• Role of Government
• Creation of enabling environment through
  appropriate policies and incentives
• Education reform with emphasis on
  entrepreneurship
• Creation of IT parks and ICT incubators to assist
  startups. Eg Egyptian smart village
• Promoting ICT based SMEs by facilitating access
  to funds
• Creation of Universal Service fund to facilitate
  ICT diffusion to rural and underserved areas
• Facilitate creation of regional and international
  trade

78
RECOMMENDATIONS contd

• Role of NGOs and CBOs
• Advocacy and awareness creation
• Mentoring and training of young entrepreneurs
• Promoting gender issues

79
RECOMMENDATIONS contd

• Role of Private sector
• Support RD
• Software development
• Outsourcing
• Mentoring and training of young entrepreneurs
  (Internship)

80
CONCLUSION
Clearly, by seeing ICTs as tool for development
and focusing on appropriate solutions taking
advantage of the right combination of ICTs ,
African countries could create decent jobs for
her citizens and improve their living
standards. E-Agriculture promises to be a very
sure way of touching the lives of majority of
Africans through ICT. The value chain resulting
from the e-Agriculture programme could create a
lot of decent jobs and hence lead to poverty
alleviation. Also, software development, taking
advantage of open source where feasible, and the
emerging global outsourcing market represent huge
opportunities for decent job creation for African
countries.

81
THANK YOU