Overview

Technological progress is a driving force behind economic growth, citizen engagement, and job creation. Information and communication technologies (ICTs), in particular, are reshaping many aspects of the world’s economies, governments, and societies.

In this context, access to the internet has become a vital development tool. The so-called Fourth Industrial Revolution is a digital revolution that requires universal and reliable internet access; without it, many developing countries will not be able to fully participate in an increasingly mobile and digital-based economy.

Public officials, businesses, and citizens in developing countries can harness the transformative power of ICTs to provide more efficient services, catalyze economic growth, and strengthen social networks. More than 75% of people around the world now have access to a cell phone. In Tanzania, for example, mobile money agents now outnumber all other financial intermediaries by a factor of 10 to 1. More than half of Tanzanians living on less than $2 a day have access to mobile technology.

At the same time, access to the internet through mobile or fixed broadband remains prohibitively expensive in many countries where lack of ICT infrastructure and regulatory bottlenecks still hamper broadband development. Of a global population of 7.4 billion people, more than 4 billion still don’t have access to the internet, with 90% of them in developing countries. And only 1.1 billion have access to high-speed internet.

The cost of residential fixed-broadband services amounts to about 30% of the average monthly Gross National Income (GNI) per capita in developing countries, compared to just 1.7% of the average national income in developed countries. This average masks vast discrepancies between and within countries, particularly affecting opportunities for the poor. In Djibouti, for example, a mobile broadband package costs more than the income of the country's poorest 60% of the population.

Under SDG # 9, the world set an ambitious target to “significantly increase access to information and communications technology and strive to provide universal and affordable access to the Internet in least developed countries by 2020”. It’s clear that governments, private sector, and the international community have a lot to do to reach this target and bridge the digital divide.

But progress is possible. Effective ICT policy reform can trigger greater private investment in broadband infrastructure and make internet access more affordable. Governments can also ensure fair taxation for the telecom industry, and use universal service funds to focus on broadband rollout, in partnership with others and under open access principles to develop healthy competition. These efforts will ultimately enable poverty reduction and shared prosperity.

Last Updated: Sep 23, 2016

The World Bank sees Information and Communication Technologies (ICT) as a game-changing opportunity for sustainable development. To help client countries harness the benefits of digital technologies, our ICT business plan for the next three years (2016-18) aims to:

  • Expand digital connectivity, with a focus on scaling up affordable access to broadband for all – including for women, persons with disabilities, disadvantaged communities, and people living in remote and rural areas. To achieve this goal, the World Bank supports countries’ efforts to enable the right policy and regulatory frameworks for a competitive ICT environment, and also provides financing for the construction or upgrading of ICT infrastructure.
  • Develop digital platforms and solutions that can improve public service delivery and make governments more open, effective, and accountable.

The 2016 World Development Report on Digital Dividends showed that digital technologies, primarily mobile phones and the internet, have contributed to considerable growth in many countries: in developing countries, it is estimated that a 10% increase in high-speed internet connections, for instance, leverages an average 1.4% increase in economic growth.

ICTs have the potential to boost economic development in many ways, including: improved services to citizens through e-government projects, job creation in the creative and high-tech industries, additional trade flows, and opportunities for small producers from developing countries to link up to global value chains. Broadening digital access will bring even greater benefits for innovation, entrepreneurship, and job creation. 

In Fiscal Year 2016 (FY16), the World Bank portfolio included 32 standalone ICT projects, with total commitments amounting to $1.6 billion. Furthermore, ICT components are increasingly included in projects across different sectors such as transport, education, health, agriculture, and public sector management.

The IFC has provided over $7 billion to more than 400 telecom, media and technology projects in 86 countries over the past years. In FY16, the IFC committed financing for a total volume of $376 million, including investments in innovative technologies across various industries: manufacturing, infrastructure, health, education, as well as e-commerce. IFC’s investment strategy in the ICT sector focuses on supporting the build-out of broadband infrastructure to increase access to the Internet, particularly in Africa, Central Asia, and South Asia, where a number of joint IFC/World Bank interventions are planned. Another key priority for IFC is to foster innovation in the provision of digital services such as FinTech, eHealth, eEducation, and eCommerce.

MIGA has provided investment guarantees totaling more than $2 billion in the ICT sector over the past 25 years, including $855 million for projects in Sub-Saharan Africa.

The World Bank’s ICT work is informed by in-depth analytical work. Recent publications include:

Last Updated: Sep 23, 2016

The World Bank Group’s work in the ICT sector aims to empower people socially, economically, and politically to reduce poverty and increase shared prosperity. Below are some examples of projects that have lowered barriers to mobile and internet access, boosted jobs, and improved government effectiveness and transparency.

In West Africa, we have helped connect seven countries to the Africa Coast to Europe submarine fiber optic cable. As a result, the price of internet access has dropped dramatically—by more than half in most cases—allowing more schools, households, and SMEs to connect to better quality internet. In the Gambia alone, the wholesale price for internet access is less than a fifth of what it used to be.

In Myanmar, we helped the government create the right regulatory environment and attract foreign investment, while developing the local IT industry and creating jobs. In 2012, it cost $300 to buy a SIM card in Myanmar. Now, it costs just $1.50—and users can choose from three operators.

In the Pacific region, the World Bank is helping the populations of remote islands gain access to broadband internet, making it easier and cheaper for people to connect to friends, jobs, and knowledge. In August 2013, a new 830-kilometer fiber optic cable connected the country of Tonga, an archipelago of 176 islands spread over 700,000 square kilometers of ocean, to Fiji and onwards to global broadband networks. As a result, the household price for a monthly internet service, per gigabyte, has fallen by 60%, and bandwidth utilization has grown tenfold. The arrival of broadband in Tonga is expected to help create more local jobs through business expansion, and will facilitate access to remote health and education services. Similar benefits are expected to spread throughout the Pacific as other countries join the Pacific Regional Connectivity Program.

In Afghanistan, a $22 million credit supported reforms that made the telecommunications market more competitive and attracted more than $1.2 billion in private investments. This helped increase the number of telephone subscribers from 57,000 to 13.4 million between 2002 and 2010, and reduce costs from $2 a minute to $0.10 a minute.

An additional $50 million project aims to expand internet access to more Afghans, building on widespread use of mobile phones to improve the delivery of public services, and supporting nascent entrepreneurship in the ICT sector. To date, about 186 kilometers of fiber cable have been deployed, and some 600 Afghans have been trained to become skilled information technology (IT) professionals.

In Mexico, boosting skilled job creation in the IT industry is also at the core of MexicoFirst. This institution, supported by the World Bank, trains and certifies IT workers for higher- paying jobs. As of 2013, more than 64,000 people were certified by MexicoFirst. An impact evaluation study found that graduates received an average salary increase of 36% after going through the certification program.

In the West Bank and Gaza, where youth and female unemployment rates are particularly high, the World Bank Group provided technical assistance to facilitate the creation of online work business partnerships between Palestinian workers and international online work companies.

In Moldova, the World Bank and its partners have helped usher an ambitious agenda that aims to transform the delivery of public services using ICTs, including the first public sector-shared cloud infrastructure for a client country, and the launch of online e-services that have improved citizen-government interactions. Moldova has won several international awards, including one by Transparency International, for its work in this area.

The World Bank is also teaming up with other partners to increase support to developing countries on this agenda. One of these initiatives is the Digital Development Partnership, which brings together the private sector, development partners and other stakeholders to help countries reap digital dividends. The other one is the Global Connect Initiative, which aims to expand internet access to the internet to an additional 1.5 billion people by 2020.

Last Updated: Sep 23, 2016





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