From Africa Recovery, Vol.15#4 (December 2001), Briefs page

'E-commerce' a tool for development

Poor countries can exploit rapidly expanding opportunities for profitable commercial ventures on the Internet, argue researchers of the UN Conference on Trade and Development (UNCTAD). "E-commerce," as it is popularly called, can be "an important tool for development," says the agency's E-Commerce and Development Report 2001, released in November 2001. Advanced information and communications technology can enable businesses to cut costs, increase efficiency and reduce constraints of time and distance, enhancing their productivity. Noting that e-commerce in industrialized countries has helped stimulate growth, the report highlights the potential for developing countries to also benefit.

Among the African e-commerce ventures cited is EthioGift, based in Addis Ababa, Ethiopia. It earned $50,000 in 2000 selling a variety of products, including "very big sheep" for family feasts, many of them bought by Ethiopians who live in developed countries but support their families back home. The key to success, observes UNCTAD, is to sell products to a diaspora community or "small niche market" abroad. Other examples include a Ugandan company selling traditional African fabrics to African-Americans and a Tanzanian venture that markets African art to the same clientele. E-commerce ventures can also be used to secure expert advice on health care from doctors in Northern countries, as well as to promote tourism via the Internet ("e-tourism"), notes the report.

There are some constraints hampering e-commerce, however, including inadequate access to computers, skilled personnel and Internet facilities, and a limited ability to handle credit card payments, the report states. For developing countries to realize the full potential of e-commerce to help narrow the North-South productivity gap, they must step up their technological development. Otherwise, it warns, e-commerce could further widen the gap.

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