How tech can help end poverty in Asia

When it comes to speed of adoption, nothing quite compares to how quickly South-East Asian countries’ mobile penetration rose in the last five years. The most competitive economies in South-East Asia (according to the World Economic Forum’s Global Competitiveness Report 2014-2015) – Singapore, Malaysia, Thailand, Indonesia and the Philippines – are the same countries where mobile subscription penetration is greater than 100%. Our analysis shows that these same countries have the highest rates of smartphone adoption, with Singapore, Malaysia and Thailand already exceeding 50% as of 2014, and with the other countries poised to reach 50% smartphone adoption by 2016.

Smartphone adoption rates are a good indicator of how ready the country is for e-services, and also on how much more traffic mobile and data networks need to accommodate. In many markets in South-East Asia, subscribers connect to the internet exclusively through the mobile phone – in fact, in our ConsumerLab studies subscribers have expressed a preference for mobile phones when it comes to internet connectivity.

As devices such as smartphones become increasingly more affordable, the internet becomes more fully accessible, allowing populations to benefit from the digital age on more equal terms leading to positive impacts for business, people and society.

For example, during one market study in the Philippines, we learned about a young mother who sold cosmetics via Facebook. What started as a means to augment their family income now allows her to earn more than what her husband makes as an overseas Filipino worker. In Bangladesh, a local taxi driver shared how his children could now look for better jobs by browsing through job opportunities online – an alternative that was not previously available for his generation.

There are many other examples of mobile subscribers using connectivity to improve their economic status, and studies that prove how Information and Communication Technologies (ICTs) help to boost economies:

  • a 10% increase in penetration leads on average to 1% sustainable GDP growth
  • Doubling broadband speeds for an economy can add 0.3% to GDP growth. In the BRIC countries, introducing a 0.5 Mbps broadband connection increases household income by $800 per year

We studied Myanmar in particular, as we prepared to re-enter the market in 2012, and what we have found is that the total economic impact of the mobile sector in Myanmar is estimated to be 1.5-7.4% of gross domestic product (GDP) over the first three years after licenses are issued, assuming there is a medium rate of mobile penetration.

The conclusion that we draw from all these studies is that ICT is the most effective and fastest way to ensure that a country’s citizens have access to the information they need to improve their socio-economic standing and overall quality of life.

However, we believe that greater efforts are needed by industry and governments to ensure that connectivity is available and accessible for all. Market forces alone are not sufficient in the near term to address what we see as the three main barriers to progress: infrastructure, affordability and usage. We are working with our customers, regulators, governments and other relevant stakeholders in South-East Asia to work towards greater accessibility for all. Mobile and internet connectivity must be integrated into a country’s development agenda, especially as developing markets in the region prepare to introduce widespread 4G/LTE coverage in the next few years. Once 4G/LTE coverage becomes ubiquitous, the possibilities to extend ICT’s usefulness as a tool to boost economies will become even more limitless.

Author: Sam Saba, President, Ericsson, South East Asia & Oceania

Image: Children try out laptops at a showroom in Seoul March 27, 2012. REUTERS/Bobby Yip

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