e-commerce in three landlocked nations*

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e-commerce in three landlocked nations
INET 2000 Developing Countries Networking
Symposium18 July 2000, Yokohama-Japan

• Michael Minges
• minges_at_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.
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Topics

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

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Internet Case Studies
ITU project to examine diffusion of Internet in
developing countries
www.itu.int/ti/casestudies
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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 paysUS 77.00

Source ICIMOD.
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Barriers to e-commerce

• Economic, social, linguistic
• Infrastructure
• Market size
• e-Business costs

Source World Bank.
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Language Literacy
Source Ethnologue www.sil.org/ethnologue,
UNDP ltwww.undp.org/hdrogt.
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Infrastructure
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Internet market
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Setting up a web business
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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 200000 cards (2 of population)

• Local sites cannot process credit cards

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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

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e-commerce dimensions
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Tourism
1998. Source World Tourism Organization.
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Mikes B2C tourism e-commerce 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
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Bolivian 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

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Gurkhas Pashmina
One of Nepals 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 Gurkhas 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
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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/
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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
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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

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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.

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The end

• Selected references
• ITU Internet Case Study site www.itu.int/ti/cases
  tudies
• UNCTAD e-commerce publication www.unctad.org/ecom
  merce/building.pdf
• IDRC e-commerce project for Uganda
  www.idrc.ca/reports/read_article_english.cfm?artic
  le_num451
• Nepal e-commerce presentation www.unctad.org/ecom
  merce/colombo/nepal/sld001.htm
• ?eriSign small business e-commerce support
  www.internet-trust-services.com/customers/small-b
  usiness.html