Positive ICT growth in the Arab world reflects more opportunities for SMEs

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The 'smart' use of information and communication technology (ICT) by companies is a critical factor for success in innovation, competitiveness and growth. As large companies are moving to exploit the advantages offered by ICT, smaller companies have to follow suit.

According to the ‘ICT Facts and Figures 2017’ report by the ITU, the United Nations specialized agency for information and communication technologies (ICTs), 830 million young people are online, representing 80 percent of the youth population in 104 countries.

Arab youth are more into internet

When it comes to the Arab region, the report showed that almost 44 percent of the total population of Arab states use the internet, whereas 64 percent of these individuals are aged between 15 and 24. Worth mentioning that 47 percent of households have internet connection, which is below the world average (54 percent).

Cosmas Zavazava.
(image via Cosmas Zavazava)

Cosmas Zavazava, chief of department, projects and knowledge management, at the Telecommunication Development Bureau (BDT), at the ITU told Wamda that research showed a gap between the GCC and the Levant countries in terms of development of the infrastructure, access to the internet, and usage, in favor of the first. However, this gap is normal and some divergence even exists in other areas such as in Asia and in Africa. “We have witnessed this year an impressive growth of internet usage which reflects the high demand in these countries. In terms of accessibility, though the region is lagging behind the world averages, there is a remarkable increase year on year, which reflects the people’s absorption and readiness,” he added.

Youth (15-24 year olds) are at the forefront of internet adoption. The global report reflected an international trend where the youngsters are the main drivers behind the ICT deployment and usage. In Least Developed Countries (LDCs) including the Arab world, up to 35 percent of individuals using the internet are aged between 15 and 24, compared with 13 percent in developed countries and 23 percent globally.

Gender gap narrowing down
While the internet user gender gap has narrowed in most regions since 2013, the proportion of men using the internet remains higher than that of women in two-thirds of countries worldwide.

In 2017, the global internet penetration rate for men stands at almost 51 percent compared to almost 50 percent for women. In Arab states, men’s internet penetration rate stands at almost 48 percent, whereas that of women is almost 40 percent.

This reflects however a drop in gender gap throughout the years, down from 19 percent in 2013 to 17 percent this year, and shows that the development in the region is being led by both genders almost simultaneously.

Growth in mobile broadband
The report revealed that mobile broadband subscriptions have grown more than 20 percent annually in the last five years and are expected to reach 4.3 billion globally by the end of 2017.

Between 2012 and 2017, LDCs saw the highest growth-rate of mobile broadband subscriptions which is over 55 percent. Despite this, the number of mobile subscriptions per 100 inhabitants in LDCs is the lowest globally at 23 percent.

There is a greater opportunity for the region to grow in industries beyond ICT.
(image via Pixabay) 

When it comes to pricing, mobile broadband prices, as a percentage of gross national income per capita, dropped by half between 2013 and 2016. Mobile broadband is more affordable than fixed broadband in most developing countries.

ICT a driver to create businesses

In today’s ICT world, it is no longer an issue of infrastructure, rather a matter of application in a way to improve people’s lives,” commented Zavazava. He said that the development of the sector will lead towards more advancement in terms of IoT, AI, and big data.

“There is a greater opportunity for the region to grow in industries beyond ICT, due to the great potentials the research echoes and the dynamism we are witnessing.” These industries include business stimulation in para-ICT fields. “We will see more SMEs and startups engaging in the business cycle and the outlook is good,” said Zavazava.

Though global telecommunication revenues declined by four percent from $2 trillion in 2014 to $1.9 trillion in 2015 according to the report, the region’s telecom has been a sector leader in profitability.

In 2014, at the end of a four-year period in which capital-expenditure intensity was 17 percent (above the industry average of 16 percent), margins on earnings of 45 percent were achieved in the MEA region, well above the global industry average of 34 percent.

Feature image via Pixabay.

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