The Information Economy Report 2012: The Software Industry and Developing Countries is the seventh in the flagship series published by the United Nations Conference on Trade and Development (UNCTAD). The 2012 edition gives focuses on the role of software capabilities in accelerating progress towards a more inclusive information society.
Key issues covered include:
- The link between software capabilities and development
- Global and regional trends in production, spending, trade, investment, venture capital and employment in the software sector
- The evolving ICT landscape and its impact on software production patterns
- Trends and implications related to free and open source software (FOSS)
- An analysis of the market orientation of software production in developing countries
- Country case studies
- Policy recommendations on how governments and their development partners can better leverage software for development and strengthen national software systems
The Report finds that, because software is increasingly permeating societies at all levels of development and activity, it is becoming more important for countries to develop the technological capabilities needed to adopt and adapt existing software solutions, and eventually to innovate. Software and service activities represent an opportunity for developing countries, thanks to the low capital entry requirements, the sector's high-value, high-growth nature and knowledge-rich profile. Due to changes in the ICT landscape, even small-scale developers in developing countries can now participate in software development and production, for example in the area of mobile applications. The Report suggests that there is considerable room for developing countries to make better use of the software potential.
The Report introduces the concept of the national software system. It emphasizes that domestic software producers and users are greatly influenced by the quality and affordability of ICT infrastructure, access to relevant human resources and capital, the legal framework, an enabling business infrastructure, as well as by the links with software networks in the rest of the world.
Governments play a central role in the national software system. Overall, the competitiveness of the system is affected by the national vision, strategy and government policies which should nurture software capabilities and the system as a whole. In particular, Governments are important users of software (notably through e-government and public procurement activities) and they strongly influence most of the enabling factors of the system.
The Information Economy Report 2012 offers several policy recommendations to governments. It also explores various examples of software development initiatives by individual countries and groups of countries.
In the Statistical Annex of the Report, UNCTAD presents among other things international data on software spending, exports and employment.
The contribution that a dynamic local information technology (IT) industry makes to national economic development - as a productive sector in itself and, more importantly, as an enabler of productive use of information and communication technologies (ICTs) throughout the economy and society - has encouraged policy makers all over the world to put in place public policies and programmes that facilitate its development.
A wide range of instruments are available to policy makers in this context. Designing and implementing public procurement practices that help to increase the participation of local IT firms when the public sector acquires IT goods and services represents one such instrument. However, successful use of public procurement policies requires a clear vision of the overall policy objective and a good understanding of the local IT sector's strengths and weaknesses.
Until now, relatively little attention has been paid to the link between public procurement and local IT sector development in developing and emerging economies. This joint UNCTAD-BMZ study seeks to address this gap and to provide decision makers with an improved basis for understanding when and how public procurement can be leveraged for the development of a vibrant IT sector. The report builds on the analytical and practical experience of UNCTAD and German development cooperation in designing and implementing measures to promote ICT sector development and build local ICT capacities in developing and emerging economies.
The report identifies seven main strategies countries may consider in this context. Based on a review of the experience of Kenya, Senegal and Sri Lanka in this area, it distinguishes between elementary measures - such as establishing open and competitive procurement processes or regular public-industry dialogues that all countries should adopt - and more advanced measures that may be appropriate once a country reaches a certain threshold level of maturity in its public procurement practices and IT sector capabilities. Policy makers need to identify a balanced mix of strategies suitable to their specific context, encompassing complementary interventions at the macro, meso and micro levels.
The successful application of public procurement for the promotion of local IT sector development is complex but can be a powerful policy tool. Our expectation is that the findings and policy recommendations included in this report will help public procurement officials, promoters of the ICT sector, e-government programme managers, local IT/software associations and the donor community to identify more effective strategies in this field.
Chairman's Summary by Mr. Timo Valli - Conference on Leading the way in eGovernment development: Conference for Government CIOs and Key Officials, 29 to 30 May 2013, Helsinki, Finland