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e-commerce in three landlocked nations*

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  1. INET 2000 Developing Countries Networking Symposium18 July 2000, Yokohama-Japan e-commerce in three landlocked nations* Michael Minges minges@itu.int International Telecommunication Union * The views expressed are those of the author and may not necessarily reflect the opinions of the ITU, its members or the countries profiled in this presentation.

  2. Topics • Why e-commerce for developing countries • Barriers to e-commerce in developing countries • What kind of e-commerce for developing countries • e-Strategies

  3. Internet Case Studies Americas Bolivia Asia Nepal Africa Uganda ITU project to examine diffusion of Internet in developing countries www.itu.int/ti/casestudies

  4. Why e-commerce for developing nations? • Increase sales, generate hard currency, boost employment and welfare • Gain expertise in information technology, reduce brain drain & urbanization • Lead to better business practices,enhance transparency & efficiency Dhaka Shawl • Producer in Nepal collects: US$ 6.60 • Consumer in Nepal pays: US$ 11.00 • Consumer in USA pays:US$ 77.00 Source: ICIMOD.

  5. Barriers to e-commerce • Economic, social, linguistic • Infrastructure • Market size • e-Business costs Source: World Bank.

  6. Language & Literacy Source: Ethnologue www.sil.org/ethnologue, UNDP <www.undp.org/hdro>.

  7. Infrastructure

  8. Internet market

  9. Setting up a web business

  10. Limited use of credit cards for B2C: Nepal: High income level for credit card, only good in Nepal and India Uganda: Cash-based society Bolivia: Around 200’000 cards (2% of population) Local sites cannot process credit cards Payment

  11. What to sell? • Understand e-commerce categories • ‘Show me the money’ • Foreigners • Expatriates • Develop areas where there are natural advantages • Local products and services • Travel

  12. e-commerce dimensions

  13. Tourism * 1998. Source: World Tourism Organization.

  14. Mike’s B2C tourism e-commerce experiences www.yakandyeti.com • Hard to locate information • Pricing not transparent • Could not place reservation from web form • ‘Clunky’ compared to big hotel chain websites www.nilehotel.com

  15. Many developing countries suffer from e-commerce logistical deficiences such as billing & shipping A big barrier is the lack of support for credit card payment One way around this hurdle is to host the site overseas For example Boliva Mall which sells local products aimed at expatriates as well as services such as local flower delivery Bolivian B2C www.boliviamall.com

  16. Gurkhas & Pashmina One of Nepal’s most famous exports is Pashmina shawls. Dozens of web sites advertize Pashmina wool products. However no Nepal located site accepts credit cards. www.huikaipashmina.com Nepalese Gurkha’s have served as reknowned soldiers abroad for over 200 years. Ex-Gurkha servicemen are leveraging that image and using the Internet to locate overseas jobs for their countrymen. www.nepalonline.net/gurkhamanpower

  17. Selling stamps in Uganda • Uganda Post Office is advertizing stamps on its web site • Many requests from overseas but payment must be made off-line http://www.ugandapost.com/

  18. One group does it all • In many developing countries, large groups dominate a significant portion of private economy • If they can be brought online, significant boost for e-commerce • Madhvani Group Uganda • Largest private investor • Over 20 companies http://www.madhvani.org

  19. Government2Business • Significant portion of population in Bolivia, Nepal and Uganda is rural • Governments should assist e-commerce applications for farmers • Product prices, input costs, transport schedules, weather reports • M.S. Swaminathan project in southern India

  20. Strategies • Act now not later. Amazon.com did not wait for perfect legal framework! • Build professional looking sites with good payment and fulfillment process to make web pages indistinguishable from 1st World sites. • Take advantage of free software and applications and support from bi-lateral and multi-lateral agencies. • Government should ‘endorse’ directories and develop relevant local applications • Be different.

  21. The end • Selected references • ITU Internet Case Study site: www.itu.int/ti/casestudies • UNCTAD e-commerce publication: www.unctad.org/ecommerce/building.pdf • IDRC e-commerce project for Uganda: www.idrc.ca/reports/read_article_english.cfm?article_num=451 • Nepal e-commerce presentation: www.unctad.org/ecommerce/colombo/nepal/sld001.htm • eriSign small business e-commerce support: www.internet-trust-services.com/customers/small-business.html