ICTs and the Internet can strengthen economic growth and recovery
Investment in Information and Communication Technology (ICT) and the Internet has the potential to boost job creation and economic growth during the current economic crisis, according to the ICC Commission on the Digital Economy.
However, ICC says opportunities for these technologies must be appropriately harnessed for this to take place.
The International Chamber of Commerce (ICC) this week released ICTs and the Internet’s impact on job creation and economic growth, a tool designed to help policymakers seize opportunities to improve economic conditions.
Findings from studies – collected in the paper by the Commission on the Digital Economy – show a positive correlation between investment in the Internet and other ICTs, and an increase in economic activity. High speed networks and ICT services not only create a platform for this activity, but also improve the competitiveness of an economy.
The studies show that this potential for growth is even more substantial in developing countries. For each 10 percentage-point increase in high speed Internet connections there is an increase in economic growth of 1.38 percentage points for developing countries, according to research from the World Bank.
“ICTs and the Internet are powerful tools for social and economic growth and this is particularly true during the current economic climate,” said Herbert Heitmann, Chair of the Commission on the Digital Economy. “There is enormous potential for these technologies to foster innovation, particularly in developing countries.”
Business supports policies that promote market entry and investments for ICTs and the Internet. Its aim is to attain greater geographic coverage of networks in order to seize the opportunities presented by increasing use of these technologies.
ICC’s Commission on the Digital Economy recommends that governments establish a regulatory framework that enables investment and that realises the full potential of high speed mobility, broadband Internet and cloud computing.
“Governments must also maximize the availability of mobile broadband spectrum for industry and allow cross border data flows in order to encourage further innovation,” Mr Heitmann said. “Any inability to meet growing demand for mobile broadband data could hinder social and economic development, as well as innovation and competition.”
The most appropriate policies for attracting investment and promoting innovation in general require:
• Open markets that eliminate investment barriers
• Pro-investment policies
• Independent regulators
• Enforcement of the rule of law
• Adequate and effective protection and enforcement of intellectual property rights
• Pro-competitive and non-discriminatory legal, policy and regulatory frameworks that also increase user choice regarding quality and cost of services
• Independent courts
• Policy approaches that foster entrepreneurship and innovation
ICTs and the Internet also have a critical role to play in building a more sustainable green economy, according to the Commission on the Digital Economy. Use of ICTs accounts for around 40% of recent overall productivity growth among OECD countries.
While ICTs are responsible for approximately 2-3% of current global carbon dioxide emissions, their application has real potential to reduce energy consumption in the remaining 97-98% of carbon emissions, according to findings in the paper.
The ICC urges policymakers to maintain a commitment to policies that will promote investment in the Internet and ICTs, which in turn will support sustainable economic growth and recovery.
Find out more about the Commission on the Digital Economy.