Lecture Series: International Responses to the Global Digital Divide

About the speakers (L to R): Iqbal Z. Quadir is an entrepreneur who founded GrameenPhone in collaboration with Grameen Bank of Bangladesh and Telenor AS of Norway. Quadir conceived and developed the company's basic concept of providing telephone access to all, including the rural poor, by adding cellular telephony to village-based micro-enterprise organized by Grameen Bank. Carlos Braga is manager of the InfoDev (Information for Development) Program, a multi-donor grant facility at the World Bank. He is also the acting Deputy Director of the Global Development Gateway, an Internet portal established to promote cooperation for development among governments, the private sector, and civil societal organizations. Thomas Kalil is a Special Assistant to the President for Economic Policy, and is the National Economic Council's "point person" on a wide range of technology and telecommunications issues. In addition, he serves as the U.S. representative to the Digital Opportunity Taskforce (DOT Force), the G-8's working group on the global digital divide.

Rapporteur's Report

On November 21, 2000, the Project on the Information Revolution and World Politics convened a panel discussion on international responses to the global digital divide. The panel?s moderator, William Drake of the Carnegie Endowment, began by noting that the current debate on the global digital divide?or the gap between information technology "haves" and "have nots"?builds on an earlier set of discussions on the role of information and communications technologies (ICTs) in development. In the 1980s, many focused on the number of people around the world with access to telephone services. The debate has now shifted to digital technologies, in particular the Internet.

There are analytical questions to be raised about the global digital divide, Drake pointed out. For example, the notion of a divide evokes comparative terminology, focusing attention on who has more of a particular resource or technology. Yet by concentrating on this "divide," we may miss some important trends. In absolute terms, for instance, many developing countries, especially in Asia and Latin America, have already exhibited tremendous progress, particularly in areas such as teledensity and Internet penetration.

Nonetheless, the idea of a global digital divide has set off a multilateral debate, with numerous players around the world focused on how to "bridge the divide." As a result, an extraordinary range of initiatives is now underway. Industrialized countries have proposed a number of programs: the United States, for example, has developed the Leland Initiative to help wire Africa, while Japan has promised $15 billion to work on the global digital divide. The G8 has also gotten involved, adopting in July an information technology charter that promised to help expand Internet access and Internet-based development around the world. Regional bodies such as the European Union and ASEAN are addressing the digital divide through their own measures, as are intergovernmental organizations such as the World Bank, the ITU, and the UNDP. The private sector is also playing a leading role, Drake continued, citing as examples the report of the World Economic Forum's task force on the digital divide and the Web portal run by the Global Business Dialogue on Electronic Commerce, which brings together individual corporate programs.

Moreover, since a variety of actors are now seeking to address the global digital divide, including individual firms, research centers, civil societal organizations (CSOs), and philanthropic institutions, several initiatives have sought to coordinate the various activities. One of the most important, Drake said, is the Digital Opportunity Task Force (or "dot force"). The dot force was created at the G8 summit as a tripartite body of government institutions, CSOs, and the private sector, and it is currently evolving into a global public policy network. The Global Network Readiness and Resource Initiative is another important coordination effort. It aims to provide country-specific self-assessments, as well as assemble teams of experts that can advise developing countries on the ground and help them develop national strategies.

In addition to coordinated top-down strategies, many local CSOs and entrepreneurs in developing countries are implementing creative technological solutions to the digital divide. Given the range and breadth of activity, Drake said, it is helpful to take stock of steps pursued by the different organizations around the world that are working together to help developing countries become knowledge societies.

The first panel speaker, Thomas Kalil, began by noting that while ICTs are relevant for economic and social development, access to ICTs is clearly not an end in itself. Rather, ICTs should be viewed as a piece of the development puzzle, to be accompanied by a range of other solutions in areas from health to education to macroeconomic policies.

Kalil then elaborated on the work of the dot force, which is producing a report for the G8?s next meeting in Genoa in June 2001. The issues it will address include the implementation of sound policy and regulatory frameworks for developing countries; ways of improving access to ICTs; and applications of ICTs for development. With such issues now on the public policy agenda, interesting ideas are emerging about policies that encourage both competition and universal access in developing countries. One example is the use of auctions that would allow for market mechanisms to determine the least amount of subsidy that companies would be willing to accept to service rural areas. Businesses are also developing new models to serve markets traditionally ignored by multinational corporations in industrialized countries, he pointed out, and ongoing research seeks to find ways that new technologies can dramatically reduce access costs.

In addition to these measures, Kalil said, increased investment in developing countries? human capital is necessary, encompassing technical training for those building and managing ICTs as well as end user training for those directly involved in the development process. Regulators should be well informed of the issues involved in creating the right environment for ICTs to flourish, and local entrepreneurs should be encouraged in viewing access gaps as market opportunities. Moreover, Kalil added, we need to see more demonstrations of ICT applications that are directly relevant to development ? for instance, connecting hospitals and clinics in developing countries in order to provide not only two-way flows of health information, but enhanced mechanisms for tracking outbreaks of infectious diseases.

Click here for Kalil?s Powerpoint presentation.

Carlos Braga, the next speaker, began by breaking down some conventional wisdom about the process of development, including notions about the importance of geographic and economic distance, the relevance of human capital over natural resources, and the supposed inability of countries to leapfrog stages of development. In each these areas, the information revolution has led to new ways of thinking about development, as well as new ways for developing countries to both converge with and diverge from industrialized nations.

Braga argued that it is somewhat ironic to speak of a digital divide, since the overall ICT environment for developing countries has improved dramatically (statistics can be found at the World Bank?s Infodev website). But it is also true, he added, that connectivity and effective use of technology are still problems in many parts of the world, such as sub-Saharan Africa. In terms of an agenda, therefore, the World Bank Group is focusing on increasing access, making investments and loans to governments for regulatory reforms that will encourage the private sector, and helping fund projects that use ICTs for development in such areas as education and training. Two initiatives that the Bank has developed to help address these and related issues are Infodev, a public/private sector trust fund that disperses ICT-related grants around the world, and the Global Knowledge Gateway, a web portal with a development focus.

Infodev, "a venture fund for IT," is unique in that it has invited private companies as well as G7 countries and some developing countries to participate in the process and contribute resources, Braga said. Infodev typically disperses small grants to its applicants, which include projects from all over the globe. The Global Development Gateway, which was started in partnership with UNDP, has also solicited and incorporated ideas from the private sector, including companies such as Microsoft, IBM and Bloomberg. By using search engines to help locate and coordinate development projects and communities of interest, Braga added, the Gateway has found an effective way to diminish transaction costs and build a rich source of content which allows for contributions from projects worldwide.

Click here for Braga?s Powerpoint presentation.

The final speaker, Iqbal Quadir, kicked off his presentation by offering his own list of conventional wisdoms and their shortcomings. In particular, he disputed the common assertion that the poor in developing countries have little use for telephones when compared to other basic amenities. The telephone, Quadir argued, should not necessarily be seen as a consumer good, but rather as a tool of production, empowering citizens in developing countries to fight against daily poverty. A belief in this idea and in the developmental potential of the private sector led Quadir to establish GrameenPhone, a company that has used cell phones to aid development in his native country of Bangladesh.

The idea for GrameenPhone came about, Quadir said, when he saw that women in rural Bangladesh were borrowing money to purchase cows and selling the milk to repay their loans. "Why can?t a cell phone be a cow?" Quadir posited, explaining that this question led him to Grameen Bank, the rural-lending institution that lent to women for cow purchases. This formed the basis for GrameenPhone, which enacted a system in which rural women would borrow money to purchase cell phones and then charge for villagers to use their services. The concept not only helped wire more of Bangladesh?s villages, said Quadir, but enabled rural women to support themselves through private enterprise.

When constructing one layer of infrastructure, Quadir noted, it is necessary to build upon layers that are already in place. Even though there were large gaps in the rural financial infrastructure of Bangladesh, Quadir was able to partner with a unique and innovative institution, Grameen Bank, which specialized in microcredit and rural lending. Ultimately, he said, his experience in Bangladesh showed that it is possible and desirable to encourage creative ICT enterprises that can work both as business models and as development projects.

Further details from Quadir's presentation will be posted soon.

During the subsequent question and answer period, several audience members agreed with Quadir?s suggestion that in some cases the institutional infrastructure of the developing world may actually be hindering development. Braga noted that the role of institutions was indeed crucial to the development process, pointing out that incomplete or faulty structural reform of telecommunications authorities in developing countries may indeed be a factor in holding up connectivity and access. Other questions highlighted the need to address the divide within countries as well as between countries; the profit feasibility of private sector projects in poor countries; and the necessity and likelihood of ICTs projects in the developing world to be sustainable, scalable and replicable.

Finally, one audience member debated the usefulness of the notion of a "global digital divide," arguing that other serious development problems did not necessitate the use of terms like "transportation divide" or "energy divide." Drake responded that knowledge is "the mother of all resources," and as such, technologies that facilitate and augment knowledge can affect all sectors of the economy. For instance, he pointed out, the ability to effectively utilize and transmit knowledge may help a country to use energy more efficiently. Kalil added that the rate of change in technological development also helps distinguish ICTs from other development areas. With many countries in the early stages of the information revolution, it is important that they now make the right investments to steer toward convergence with industrialized nations.

Report prepared by Shanthi Kalathil.