e-commerce in e-commerce in three landlocked nations*three landlocked nations*
Michael [email protected]
International Telecommunication Union
INET 2000Developing Countries Networking Symposium
18 July 2000, Yokohama-Japan
* 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.
TopicsTopics
• Why e-commerce for developing countries
• Barriers to e-commerce in developing countries
• What kind of e-commerce for developing countries
• e-Strategies
Internet Case StudiesInternet Case Studies
Africa
Uganda
Americas
Bolivia
Asia
Nepal
ITU project to examine diffusion of Internet in developing countries
www.itu.int/ti/casestudies
Why e-commerce for Why e-commerce for developing nations?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$ 77.00Source: ICIMOD.
Barriers to e-commerceBarriers to e-commerce
• Economic, social, linguistic
• Infrastructure• Market size• e-Business costs
Bolivia
Nepal
Uganda
GNP per capita1998, US$
$300
$200
$1'000
Source: World Bank.
Language & LiteracyLanguage & Literacy
CountryMain
mothertongue
#Langu-ages
Literacy
BoliviaSpanish 40%Quecha 37%Aymara 24%
39 86%
Nepal Nepali 58% 124 39%Uganda Luganda 16% 46 64%
Source: Ethnologue www.sil.org/ethnologue, UNDP <www.undp.org/hdro>.
InfrastructureInfrastructure
Bolivia Nepal UgandaHouseholds with electricity
67% 15% 4%
Telephone lines (Density)
502’403 (6.2%)
234’668(1.1%)
59’424(0.27)
Mobile phones (Density)
420’344(5.2%)
3’154(0.01%)
87’173(.40)
PCs per 100 People
1.2% 0.27% 0.28%
Internet marketInternet marketBolivia Nepal Uganda
Internet start 7/95 7/95 7/95Number of ISPs
10 8 4
Number of subscribers (Density)
25’600(0.32%)
8’900(0.04%)
4’100(0.02%)
Number of users (Density)
75’000(0.94%)
35’000(0.15%)
25’000(0.12%)
International bandwidth (Mbps)
8 5 1.2 up1.7 down
30 hours of dial-up Internet
US$ 37 US$ 38 US$ 146
Setting up a web businessSetting up a web business
Bolivia Nepal UgandaLeased line per month
US$ 1’000
64kbps
US$ 570 38.8 kbps
US$ 25064kbps
Web hosting per month
US$ 12 - 30
US$ 10 / month
minimumPrice of domain name
.boUS$ 100
.npfree
.ugUS$ 50
Payment Payment
• 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
What to sell?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
e-commerce dimensionse-commerce dimensions
Domestic Foreign
Business-Consumer
Local business selling to local
consumers
Local business selling to foreign
consumers
Business-Business
Local business selling to local
business
Local business selling to foreign
businessGovernment-Business / Consumer
Government applications
Export-related documents
TourismTourismBolivia Nepal Uganda
Lake TiticacaEco-tourism
Mt. EverestBuddha Birthplace
Source of NileMountain gorillas
434’000 tourists*13% exports*
435’000 tourists*11% exports*
238’000 tourists*22% exports*
http://www.mcei.gov.bo/web_mcei/Turismo/turismo.htm
http://www.welcomenepal.com
http://www.utbsite.com
* 1998. Source: World Tourism Organization.
www.yakandyeti.com
Mike’s B2C tourism e-Mike’s B2C tourism e-commerce experiencescommerce experiences
• Hard to locate information
• Pricing not transparent
• Could not place reservation from web form
• ‘Clunky’ compared to big hotel chain websites www.nilehotel.com
Bolivian B2CBolivian B2C• 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
www.boliviamall.com
Gurkhas & PashminaGurkhas & Pashmina
www.nepalonline.net/gurkhamanpower
www.huikaipashmina.com
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.
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.
Selling stamps in UgandaSelling 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/
One group does it allOne 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
Government2BusinessGovernment2Business• 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
StrategiesStrategies• 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.
The endThe 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
