WAKE-UP CALL TO ASIA AND PACIFIC ON INFORMATION TECHNOLOGY FRONT -- EXPERTS WARN THAT REGION COULD LOSE BUSINESS TO DEVELOPED WORLD
Press Release
REC/41
WAKE-UP CALL TO ASIA AND PACIFIC ON INFORMATION TECHNOLOGY FRONT -- EXPERTS WARN THAT REGION COULD LOSE BUSINESS TO DEVELOPED WORLD
19990427 BANGKOK, 27 April (UN Information Service) -- A host of experts from different parts of Asia and the Pacific today called upon governments in the region to pay greater attention to developing their electronic commerce and information technology capabilities. Failure to do so, they warned, could result in the region losing business in several important sectors to a small number of developed countries which have a head start over the rest of the world in electronic commerce activities."Most governments [in the region] have yet to absorb the implications of information and communication technology, or to adopt policies to encourage the required development of skills and the spread of access", said Adrianus Mooy, Executive Secretary, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP). Mr. Mooy was speaking at an informal panel discussion on "Information technology, globalization, economic security and development" held at the United Nations Conference Centre, Bangkok, as part of the fifty-fifth session of ESCAP.
The ESCAP Executive Secretary said that information technology was clearly a very significant force behind the increasing globalization of economic activity such as production, trade and finance, and he urged governments to imaginatively promote its vigorous use.
"We need to grasp that enlightened policy initiatives will enhance the positive economic impact of information and communication technology, that such initiatives can lead to the reduced marginalization of developing countries in the global society, and of economically disadvantaged groups within a country", Mr. Mooy said.
Speaking at the panel discussion, K.K. Bajaj, Deputy Director-General, National Informatics Centre, India, said that if current trends in information technology use continue, the gap between information-rich and information-poor countries will further widen. Mr. Bajaj quoted estimates that show that by the year 2001 nearly 40 per cent of the United States population will be online, compared to only 13 per cent in Europe. "The situation in developing countries is far worse than in Europe", Mr. Bajaj said.
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Pointing out that by the year 2000, the total volume of electronic commerce in the world would reach around $600 billion, which is about 10 per cent of all global trade, Mr. Bajaj said "this technology has to be seized by the developing countries to their advantage". Similarly, Mr. Bajaj noted that while the United States alone accounted for nearly 50 per cent of the 147 million Internet users worldwide, Asia, excluding Japan, accounted for only 7 per cent.
"Clearly, the developing countries, though very large in size and population, and commanding a fair share of the world trade, are non-entities in cyberspace, both as users and information providers", Mr. Bajaj said.
In the area of trading in stocks and futures, too, an expert at the ESCAP panel discussion warned, traditional stock exchanges in Asia were at risk of losing out to online traders.
"Online trading of stocks and shares is becoming increasingly popular in the United States, but the rest of the world still has quite a way to catch up", said Stephen Cheung, Research Consultant with the Securities and Futures Commission, Hong Kong, China. According to Mr. Cheung, studies forecast that the number of online investing accounts would grow to 14 million by the year 2002, with assets managed online reaching $688 billion.
"Forward-looking online brokers from the United States will continue their ambitious expansion into other geographic locations including Hong Kong, China", Mr. Cheung said. According to Mr. Cheung, local markets will suffer as a result of losing volume to foreign markets through the Internet.
"Small brokers are especially vulnerable because of their lack of resources to develop their own Internet capability. A concerted effort by the governments, brokers and exchanges is required to hammer out a solution", said Mr. Cheung.
Mr. Cheung predicted a growing trend of alliances between exchanges to increase their pool of stock liquidity, capture market share and lower transaction costs for online investors.
Another expert at the panel discussion pointed out that, in a global economy, information technology plays a more important role than traditional economic inputs such as labour and capital.
"Thanks to advanced information technology, knowledge-based workers, who create and utilize information, play a key role in economic activities", said Hwang Eui-hwan, Director, Technology Standards Division, Ministry of Information and Communication, Republic of Korea.
Mr. Hwang pointed out that information technology was changing the production, investment and employment structures of entire economies.
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Mr. Hwang said that while the number of workers in the manufacturing sector is being drastically reduced, employment in the information and knowledge-intensive service sector is rapidly increasing.
In the United States, for example, the total number of telecommuting workers had increased from 4 million in 1990 to 11 million in 1997. According to Mr. Hwang, the Government of the Republic of Korea had drawn up an ambitious plan titled "Cyber Korea 2" to utilize information technology to overcome the downturn in its economy as part of the Asian economic crisis.
The three-day ministerial segment of the fifty-fifth Commission session, which began on 26 April, will end tomorrow with the adoption of a report containing a plan of action and resolutions by member and associate member countries of ESCAP.
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