A Grassroots View: Helping Small Firms Put the "E" in Trade

By Peters, Teresa | International Trade Forum, January 1, 2003 | Go to article overview

A Grassroots View: Helping Small Firms Put the "E" in Trade


Peters, Teresa, International Trade Forum


National strategies need to concentrate on real e-issues facing small firms, so that they can benefit from information and communications technologies.

We need more awareness of the benefits and efficiencies that information and communications technologies can bring to developing countries. This is especially true for economic development and growth of small and medium sized enterprises (SMEs) - the drivers for growth in developing countries. Stimulating the SME sector is a smart strategy for governments striving to bring economic opportunity to the most needy, especially in light of growing evidence linking entrepreneurship to economic growth and poverty reduction.

SMEs are often the backbone of the private sector in the developing world, creating jobs and providing a tax base for local government, which in turn, provides revenue for things like improving basic infrastructure, schools and hospitals. Frequently, SMEs offer the only employment available to millions of poor people throughout the world.

E-trade promises

While information and communications technologies (ICTs) may not seem like a central concern when small businesses need good business plans and seed funding more than computers, today's information society requires that most SMEs have some level of ICT use integrated into their business. Entrepreneurs who use ICTs appropriately can run a more efficient business and reach markets that were previously unimaginable.

Many developing countries fail to create and maintain an environment fostering SME development and ICT use. Lack of basic infrastructure - from roads and electricity to telephones and Internet connectivity - is an obvious, often insurmountable barrier. Likewise, a country's legal and regulatory framework helps or hinders small businesses and ICT deployment.

One example is how business relies on technology or infrastructure that is limited by current laws or regulations, such as laws that control or ban the use of satellite, wireless, or voice over Internet protocol (VoIP) technologies. Another example is ICT-based businesses that are hindered by fiscal or customs policies limiting crossborder trade in computing technologies or ICT-based services.

In sectors where current laws or regulations do not cover ICT use, businesses face grey areas instead of reliable and transparent rules. In healthcare, for example, firms using ICT need appropriate privacy and data protection laws to govern the handling of electronic health data.

Making access a reality

For SMEs to realize the promise of e-trade, national ICT and e-development strategies must cover a range of issues, and implement them effectively over the long term. We at Bridges.org call this real access to ICTs.

* Infrastructure. E-trade will only be a reality when there is physical access to ICT that is appropriate to the needs of the business and the local conditions in which it works.

* Affordability. Technology must be affordable to own and/or to use by SMEs, and business must be able to sustain its ICT use within local economic conditions.

* Training. People in SMEs must be able to explore possibilities to use ICT to improve business, and they must be trained to use it effectively.

* Relevance. There must be applications, content, and services available to SMEs that are relevant to their business, especially in terms of language.

* Integration. Technology use must be integrated into the business so that it makes it faster, easier, or cheaper to do something they need to do instead of loading additional burdens on doing business.

* Security. SMEs must understand threats they face in doing business in an electronic environment and their responsibilities with respect to privacy and data protection, and they should feel confident in the use of security technologies. …

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A Grassroots View: Helping Small Firms Put the "E" in Trade
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