Two Asian nations -- Korea and Singapore -- have managed to leapfrog multiple stages of economic development and have transformed into economic miracles. This comes as no accident, in part, because both have taken a planned approach to technological development, starting with national broadband plans, which has led to increased broadband adoption, and successive waves of economic growth.
A new report by the UN Broadband Commission and Cisco shows that Korea and Singapore are the most notable examples of a statistically significant trend; Countries that embrace national broadband plans have increased broadband adoption. The data show that the introduction of a broadband plan accounts for 2.5 percent higher fixed broadband penetration and 7.4 percent higher mobile broadband penetration. This is based on a thorough examination of broadband adoption data from 2001 through 2011.
For developing countries, 2.5 percent is nearly half of current fixed broadband penetration (6 percent). This is a significant impact and at the global level translates into over 175 million more broadband connections. In most cases, a single fixed connection serves multiple people, meaning more than half a billion more people onto broadband.
The report also demonstrates that a competitive market results in higher broadband penetration, with a particularly strong impact for mobile broadband. Competitive mobile broadband markets have 26.5 percent higher penetration on average.
Now why is this important?
Because, as we know, higher broadband penetration drives economic growth and helps nation achieve social goals, such as improved education and health care outcomes.
In the Republic of Korea, for example, the Government instituted a series of IT master plans since the mid-1990s, and the nation has since become a world leader in the utilization and production of IT. Over the last two decades, its nominal GDP per capita has more than doubled from under $12,000 in 1995 to over $25,000 in 2013 and the country consistently ranks in the top 10 countries in terms of average broadband speeds and adoption.
Similarly, in Singapore, the country has had national IT related plans in place since 1985 (starting with the National Computerisation Plan and most recently the iN2015). Over this period, the country has significantly advanced its IT environment. In 1980 Singapore was still at an early stage in IT development as it had only 22.2 fixed lines per 100 people, substantially below other countries such as Australia (32.3 fixed lines per 100 people) and New Zealand (36.1 fixed line per 100 people). But today, Singapore stands atop several measures of IT and broadband adoption, such as the 2013 Networked Readiness Index, where Singapore ranks second worldwide out of 144 countries.
And Korea and Singapore are just two examples; the same trend holds true for Chile, Spain, Latvia, Lithuania, and several other countries, including many on the African continent.
In Nyangwete, a remote Kenyan village of 20,000 people, Community Knowledge Centers are giving citizens Internet access and, with it, connections to language and technology training, health care information, and other resources. Local farmers connect with Kenya Seed Company to buy sorghum seeds then sell back the crops. In 2010, the village's income from agriculture increased by 34 million Kenyan shillings (almost $400,000). Roughly 10 to 15 percent of the village population has branched out into new business after the influx of money in 2010. The number of women with personal businesses grew 20 to 30 percent since 2010, and the number of women receiving a secondary education has increased by roughly 20 percent since 2010.
Broadband deployment leads to more than economic opportunity; it can help create social progress and lead to healthier communities. In Kenya, Inveneo helped a nongovernmental organization called Organic Health Response (OHR) set up a 512kbps connection on Mfangano -- an island in Lake Victoria with 26,000 inhabitants, dirt roads, and one of the highest HIV infection rates in the world. In exchange for having HIV tests every month, residents can access the Internet for free at an OHR training center. Once the broadband link was established, word spread quickly across the island, and within a few hours all 10 computers at the center were in use. As a result, more citizens are connected to the world outside Mfangano and 2,000 of them have enrolled in HIV/AIDS-related social services offered by OHR.
For policymakers thinking about how to jumpstart their economies, there are 5 basic takeaways.
- Develop a national broadband plan to set a strategic vision for how information technology will drive your country's knowledge economy;
- Get buy in from both public and private constituencies;
- Ensure the plan is balanced between the supply of high-speed Internet and demand driving adoption;
- Implement rules and regulations that ensure a competitive broadband market;
- Finally, regularly monitor progress toward broadband targets and ensure implementation and follow through.
The message to policymakers is clear: If you want to increase economic growth, focus on broadband. And to drive broadband, have an effective national broadband plan.
To read the report in full, click here.