ILOILO--ITUITU--ECA study on the impact of ECA study on the impact of ICTsICTs on on Employment and Poverty Alleviation in AfricaEmployment and Poverty Alleviation in Africa

The Information Society: What Regional The Information Society: What Regional Commissions are doingCommissions are doing

Presentation outlinePresentation outline

Background (General/WSIS)The StudyObjectivesMajor QuestionsGeneral FindingsFactors for ICT & Job CreationICT Employment Opportunities - EgyptWay Forward

General BackgroundGeneral Background• The 39th Conference of African Ministers of Finance, Planning and

Economic Development, Ouagadougou, Burkina Faso, 10 to 15 May 2006

• Ouagadougou Declaration on Employment and Poverty Alleviation in Africa, the African Union Extraordinary Assembly of Heads of State and Government, September 2004

• Implementation of the Regional Initiative on ICT Applications adopted by the World Telecommunication Development Conference, Doha 2006

WSISWSIS BackgroundBackground

Action line C7

• Geneva Plan of Action (2003)Encourage the development of best practices for e-workers and e-employers built. Promote new ways of organizing work and business.Promote teleworking to increase employment opportunities in developing countries, LDCs, and small economies.Intervention programmes in S&T targeted at young girls to increase the number of women in ICT careers.

Background WSISBackground WSISAction line C7

• Tunis Commitments (2005)

“The growth and productivity enhancing effects of well implemented investments in ICTs can lead to increased trade and to more and better employment.

For this reason, both enterprise development and labourmarket policies play a fundamental role in the adoption of ICTs”.

The StudyThe Study• Collaborating institutions:

• ECA• ITU• ILOWith financial support from the Government of Finland

• Countries covered:• Burkina Faso• Cameroon• Egypt• Ethiopia• Kenya

• Mozambique• Nigeria• Senegal• Uganda

ObjectivesObjectives• Prepare a Technical Paper on the impact of ICTs on

Employment and Poverty Alleviation in Africa

• Insights into labour and employment strategies required for the Knowledge Economy

• Potential new areas of employment creation in African economies

• ICT as a sector to leverage the growth and competitiveness of other sectors

Major QuestionsMajor Questions

• What jobs should be created and which sectors?

• Role of Governments and the private sector?

• Mechanisms for the creation of such jobs?

• Resources needed to attain a given level of employment?

General FindingsGeneral Findings• ICTs associated with new patterns of job creation and job loss

• indications that jobs could be lost through three main channels:a) Obsolescenceb) Automation – replaces old tasks and occupations e.g

telephone switchboard.c) “Disintermediation“

• Demand for ICT products and services are beginning to generate new jobs in Africa

• New industries such as the software, micro-electronics, GSM industries etc. brought about new employment opportunities

Factors for ICT & Job CreationFactors for ICT & Job Creation• Liberalization of the ICT sector and the importance of appropriate

infrastructure• Economic Reforms• Universal Access Provision• Large Pool of literate citizens and the importance of human

capacity• Outsourcing• Effect of Diaspora on Business Process Outsourcing (BPO)• Gender• e-Commerce• Cost of Bandwidth for Internet Access• Entrepreneurship• E-Agriculture

Factors for ICT & Job CreationFactors for ICT & Job Creation1. Liberalization of the ICT sector and the

importance of appropriate infrastructure

The study shows that:a) Access to reliable, and affordable telecommunications andelectrical power infrastructure is an important precondition for the use of ICT to generate employment opportunities.

b) Higher ICT penetration, more vibrant economy, higher job creation (directly and indirectly) and more positive impact on poverty alleviation recorded in countries that are liberalized

Factors for ICT & Job CreationFactors for ICT & Job Creation2. Economic Reforms

• Nearly all the African countries examined are undergoing one form of economic reform or the other

• ICT barely mentioned in the Poverty Reduction or Poverty Eradication documents of the various countries

• The documents did not articulate how ICT could be used to drive the development of the various sectors of the economy.

Factors for ICT & Job CreationFactors for ICT & Job Creation3. Universal Access Provision

• Countries such as Nigeria and Egypt have put in place Universal Service policies that are designed to facilitate the penetration of ICT services to rural underserved and commercially unviable areas of the countries.

• Mozambique, Kenya and Ethiopia are still in the process of developing their Universal Access policies.

Factors for ICT & Job CreationFactors for ICT & Job Creation4. Requirement for highly literate citizens and the

importance of human capacity

• Apart from Egypt and Nigeria, the study indicates that most African countries lack the critical mass of skilled ICT manpower required to drive and grow the ICT sector.

• This goes to underscore the need for deliberate policies to promote the development of the required critical mass of skilled ICT manpower in the various countries

Factors for ICT & Job CreationFactors for ICT & Job Creation5. Outsourcing

• Even though the global outsourcing market is very huge, most of the countries studied are yet tap fully into it.

• The study also shows that African countries have the potential to participate actively in outsourcing and a lot of jobs could be created as a result.

Factors for ICT & Job CreationFactors for ICT & Job Creation6. Effect of Diaspora on Business Process

Outsourcing (BPO)

• The Egyptians and Nigerians in the diaspora playing very active roles to ensure that the respective countries take advantage of the emerging global BPO market

• The other African countries are yet to exploit the great potentials of their citizens in diaspora for the development of the BPO markets in their countries

Factors for ICT & Job CreationFactors for ICT & Job Creation7. Gender Issues

• Recognition by countries to mainstream gender in ICT programmes,

• However, Egypt is perhaps the only country of the countries being studies where women’s participation in ICT is pronounced.

Factors for ICT & Job CreationFactors for ICT & Job Creation8. e-Commerce

• The lack of a functioning e-payment systems and e-signature acts in the countries hindering the growth of e-commerce

• However, m-commerce (using GSM to facilitate payment) is already thriving in Nigeria and Kenya

• Need to create the necessary enabling environment for the establishment of e-payment systems.

Factors for ICT & Job CreationFactors for ICT & Job Creation9. Cost of Bandwidth for Internet Access

• Minimum Bandwidth required for meaningful internet access is 256 Kbps

• However, the high cost of bandwidth in most of the countries studied a major deterrent to ICT penetration and a major hindrance to creation of jobs through ICT

• The free internet strategy adopted by Egypt may be worth replicating in other African countries as a way of enhancing ICT diffusion

Factors for ICT & Job CreationFactors for ICT & Job Creation10. Entrepreneurship

• In virtually all the African countries visited, the education system does not emphasize entrepreneurship with the result that graduates are always looking up to the government to provide jobs.

• Education systems should be reviewed to encourage entrepreneurship which would encourage young graduates to be innovative, creative and job creators rather than job seekers.

Factors for ICT & Job CreationFactors for ICT & Job Creation10 e-AGRICULTURE

• In all the countries, about 70% of the citizens earn their living from agriculture.

• The Egyptian pilot e-Agriculture programme, the Virtual Extension Research Communication Network (VERCON) shows that the value chain created through the introduction of appropriate e-agriculture programmes holds very huge potentials for generating large volume of decent jobs in African countries.

Networked Readiness Index 2006 Networked Readiness Index 2006 –– 20072007

African Rank Global Rank Score

Egypt 6th 77 3.44

Nigeria 10th 88 3.23

Kenya 13th 95 3.07

Mozambique 20th 115 2.64

Ethiopia 23rd 119 2.55

Factor for Job Creation/Some countries studiedFactor for Job Creation/Some countries studied

ICT Employment Opportunities ICT Employment Opportunities -- EgyptEgypt

In Egypt,

• Number of established ICT companies at 1,695 as at 2005

• ICT industry provides over 5,000 direct jobs and 15,000 indirectjobs

• Over 113,732 graduates of the special IT training programmes of MCIT have all been employed in the ICT industry

• The 10,000 seat Call centre at the smart village carries the potential to put 30,000 young Egyptian graduates on a steady payroll

Some Outcomes Some Outcomes -- CODICODI• Committee on Development Information –

CODI: Employment and the Knowledge Economy, 1-4 May 2007

• Technical Committee for ECA on Development Information, including ICTs.

• Provided input to ECA and partners work on employment and the knowledge-based economy and implications for Africa

Some Outcomes Some Outcomes -- CODICODI• Committee on Development Information –

CODI: Employment and the Knowledge Economy, 1-4 May 2007

• Place employment creation as an explicit and central objective of economic and social policies in Africa

• Deploy important efforts to improve the quality and coverage of education and skills enhancement systems that respond to the needs of rapidly changing economies

• Accord special attention to SMEs, young workers, women, vulnerable groups and people with disabilities as well as workers in the informal economy.

Way ForwardWay ForwardInput into Global Knowledge 3 Conference

ConclusionsConclusionsCentral Issues to be pursued regionally by ECA/ITU/ILO:

ICTs altering most components of production and marketing systems in economyJob creation strategy to cover all economic sectors including agricultureInvestments needed for learning, knowledge and innovationNeed for a review of national education, skills development and employability systemsStrengthen training systems to retrain existing labour force andimprove skills of new entrants into labour forceDevelop systems to enhance enterpreneurship culture Design of a favourable regulatory environment

ConclusionsConclusionsCentral Issues to be pursued regionally by ECA/ITU/ILO:

In preparing an ICTs based employment policy negative effects must be noted and anticipated as well as an identification of factors that can hamper their implementationSocietal members must understand the reason for change, measures adopted to implement change and efforts that all stakeholders have to makeTherefore, need for social dialogue, namely workers and employers’ organisations who represent the most affected components of society should participate in this dialogue

Thank You !Thank You !

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