The impact of broadband on developing country GDP

This year, a World Bank report reveals the impact of broadband on growth in 120 countries from 1980 to 2006. Its analysis revealed that each 10 percentage points of broadband penetration results in 1.21% increase in per capita GDP growth in developed countries, and 1.38% increase in developing countries. Consider the example of broadband deployment in China. Another report by Professor Leonard Waverman suggests the release of new spectrum for mobile broadband services in 2009 will ultimately add the equivalent of $211 billion to China’s GDP and create 300,000 jobs.

….. Thailand’s transition to broadband may well evolve quickly, affordably and in a way that might uplift the lives of millions of low income citizens.

Many have argued that broadband can work for advanced countries but not emerging markets. The data is beginning to show otherwise.

This year, a World Bank report reveals the impact of broadband on growth in 120 countries from 1980 to 2006. Its analysis revealed that each 10 percentage points of broadband penetration results in 1.21% increase in per capita GDP growth in developed countries, and 1.38% increase in developing countries. Consider the example of broadband deployment in China. Another report by Professor Leonard Waverman suggests the release of new spectrum for mobile broadband services in 2009 will ultimately add the equivalent of $211 billion to China’s GDP and create 300,000 jobs.

Where does Thailand fit in this picture? Nokia Seimens’ Connectivity Scorecard, shows that Thailand has room to develop its ICT infrastructure and benefit the economy and society, ranking No. 11 of the 25 countries studied in the resource- and efficiency-driven economies.

However, broadband services are only moderately developed. But now that business, government and academia are all aligned in support of meaningful broadband, this picture could quickly change. Thailand possesses relatively better human capital resources than most Southeast Asian nations. Broadband could boost them much further. These benefits could be enhanced through the cooperative sentiment expressed at the Meaningful Broadband seminar. Examples of these benefits include:

– A new approach can emerge for Universal Service Obligation. USO refers to a fund derived from 4% of telecommunications investments made in Thailand. The working group would consider how the fund could stimulate markets to benefit large number of low-income Thais who might otherwise not benefit from broadband.

– Public-private partnerships could develop to inject subsidies into mobile supply chains, enabling them to serve a lower income stratum of the population, and produce content that transmits skills and jobs to these forgotten citizens.

– Education reform could become a reality for Thailand thanks to broadband, especially if integrated into policies for human resources development being conceived by the prime minister.

These are just a few ideas from the to come out of the Meaningful Broadband Working Group. Thanks to its formation, Thailand could find a new 21st century pathway towards human development.

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