Broadband (or high-speed) internet access is not a luxury, but a basic necessity for economic and human development in both developed and developing countries.
It is a powerful tool for the delivery of essential services such as education and healthcare, offers increased opportunities for women's empowerment and environmental sustainability, and contributes to enhanced government transparency and accountability. It also helps foster the social development of communities, including within the broader global context.
The challenge is to expand broadband access to all. Only about 35 percent of the population in developing countries has access to the Internet (versus about 80 percent in advanced economies). Broadband has also become a foundation for smart infrastructure (e.g. Intelligent Transport Systems and Smart Electric grids) that is facilitated by new wireless technologies. It can help create jobs in information and communication technology (ICT), engineering and other sectors, as well as help catalyze job skills development, an important avenue toward poverty reduction and shared prosperity.
In addition, broadband can help expand the reach of task-based work through online outsourcing platforms, which are projected to provide millions of jobs and billions of dollars in revenue over the coming years. Raising Internet penetration to 75 percent of the population in all developing countries (from the current level of approximately 35 percent) would add as much as US$2 trillion to their collective gross domestic product (GDP) and create more than 140 million jobs around the world.
The challenge is to expand broadband access, especially in rural areas. Even “digital divides” in access exist across regions and countries, such divides within countries have a disproportionate impact on rural communities and the poor. For example, while broadband use in the capital cities of India, the Kyrgyz Republic and Moldova and are at the same level as some Organization for Economic Co-operation and Development (OECD) members, usage in these three countries’ rural areas is among the lowest in the world. These disparities impede shared prosperity and constrain access to pathways out of poverty.
One possible solution for expanding broadband is to unleash private investment to the maximum extent possible, supplementing it where the social returns on these investments outweigh the private returns — for example, in rural areas where costs are high or revenues are low. This requires a mix of approaches to address a range of constraints, the World Bank Group can play a major role in connecting more people to the Internet.
The World Bank is strongly committed to affordable broadband access and has established the following goals to help address that goal:
- Position at least 35 land-locked, fragile and small-island countries to develop affordable broadband Internet service for all residents by 2020 in support of Sustainable Development Goal (SDG) 9.c: “strive to provide universal and affordable access to the Internet in least developed countries by 2020.” An affordable entry-level broadband subscription would cost less than five percent of average per-capita income.
- Provide technical assistance to (1) create national and regional frameworks enabling private and public-private investment in broadband service and (2) design investment-ready projects that will achieve the availability and affordability target.
The World Bank experience
The World Bank has generated significant progress in developing countries through innovative strategies and models including:
Sector policy and regulatory reforms. The World Bank helps governments, companies and other stakeholders implement sector reform to stimulate private investment and competition with a strong emphasis on low-income, fragile, small-island, and landlocked states. Our globally recognized and widely quoted studies have provided our clients with deep sector analysis and evidence-based recommendations in all areas of broadband market development.
Loans and grants for broadband. Since 2007, we have allocated US$1.2 billion with a focus on projects for submarine cables and terrestrial backbone networks, and for regional integration in the South Pacific, the Caribbean, and East, Central and West Africa.
Partnering for broadband. The World Bank has invested in complex public-private ventures in digital infrastructure to expand broadband access in frontier markets, including Burundi, Democratic Republic of Congo, Gabon, The Gambia, Guinea, Liberia, Malawi, Rwanda, and São Tomé and Príncipe.
Partnering with the World Bank
Development partners in affordable broadband access for all work with the World Bank for the policy and regulatory aspects and for the framing of interventions, including public-private partnerships and the remedying of market failures. In addition, partners collaborate with IFC and MIGA for the mobilization of private investors.
In order to develop new solutions and help finance grants, we also seek strategic partnerships with multinational organizations, industry and foundations. Areas of focus in such partnerships include feasibility studies, regulatory capacity building and technical assistance in sector reform.
With well-designed interventions, multisector partnerships, policy reforms and through the efforts of the World Bank, its donors, partners and client countries, affordable broadband access is becoming a reality for more communities across the globe.