Wednesday, April 4, 2012

Nepal’s pathetic readiness in information technology

The latest Global Information Technology Report 2012 ranks Nepal 128 out of 142 countries in terms of network readiness. Insufficient development of ICT infrastructure has limited its ability to leverage information and communications technologies to boost country competitiveness. It has stifled entrepreneurship and innovation.

Out of a total score of 7, Nepal scored 2.9. Overall, Nepal’s technology readiness is lower than the average of low income countries (except for in affordability--in mobile cellular tariffs PPP $/min, Nepal is eighth competitive in the world).

The Networked Readiness Index 2012
Rank Country Score Rank Country Score
1 Sweden 5.94 69 India 3.89
2 Singapore 5.86 71 Sri Lanka 3.88
3 Finland 5.81 102 Pakistan 3.39
4 Denmark 5.70 113 Bangladesh 3.20
5 Switzerland 5.61 128 Nepal 2.92
6 Netherlands 5.60 138 Chad 2.55
7 Norway 5.59 139 Mauritania 2.55
8 United States 5.56 140 Angola 2.49
9 Canada 5.51 141 Yemen 2.41
10 United Kingdom 5.50 142 Haiti 2.27

The index is composed to ten pillars. Nepal’s ranking (out of 142 countries) in each category is listed in brackets.

  • Political and regulatory environment (123)
  • Business and innovative environment (122)
  • Infrastructure and digital content (135)
  • Affordability (74)
  • Skills (128)
  • Individual usage (136)
  • Business usage (130)
  • Government usage (128)
  • Economic impacts (132)
  • Social impacts (126)

The report notes that ICT readiness in sub-Saharan Africa is still low, with most countries showing significant lags in connectivity due to insufficient development of ICT infrastructure, which remains too costly, and displaying poor skill levels that do not allow for an efficient use of the available technology. Even in those countries where ICT infrastructure has been improved, ICT-driven impacts on competitiveness and well-being trail behind, resulting in a new digital divide.

Under the theme Living in a Hyperconnected World, the report explores the causes and consequences of living in an environment where the Internet is accessible and immediate; people and businesses can communicate instantly; and machines are interconnected. The exponential growth of mobile devices, big data and social media is a driver of this process of hyperconnectivity and, consequently, fundamental transformations in all areas of society are being witnessed. This year’s report tracks how societies leverage ICT to derive important competitive advantages and increase social well-being.

Nepal: Aid at a glance (2010)

Net ODA to Nepal amounted US$821 million in 2010, down from US$854 million in 2009. Austerity in the donor countries is squeezing ODA as well. The UK seems to be the largest bilateral donor (US$107 million). A major portion of the ODA went to education (almost 20 percent), followed by health and population, other social sectors, and economic infrastructure and services, among others. For more, see here

What happens when real wage growth outpaces labor productivity growth?

Well, it suppress employment creation. Klein assesses the South African labor market and employment creation in this paper, whose abstract is copied below.

The paper looks at the dynamics of employment in South Africa and examines the factors that contributed to the job-shedding observed during the recent financial crisis. The paper finds that the rapid growth of the real wage, which outpaced the labor productivity growth in most sectors, played an important role in suppressing employment creation. The paper also finds that while there is a co-integrating link between the real wage and labor productivity, the deviations from equilibrium are persistent and thus contribute to a weak link between real wage growth and labor productivity growth in the short term. This finding is also supported by a cross-country analysis, which shows that in South Africa the link between the real wage and labor productivity is substantially weaker than in other emerging markets, even after controlling for labor market tightness indicators.

May be the unruly trade unions in Nepal should have a look at the findings of this paper.