Asian countries show stark digital divide

Singapore heads group of "Asian Tigers" adept at using ICT to enhance competitiveness, but developing markets such as Malaysia, China and India hindered by poor regulatory and political environments, new report shows.

Singapore ranks second behind Sweden in the Networked Readiness Index (NRI), which measures the degree to which economies around the world harness ICT to enhance their competitiveness. However, the gap between digitized nations and those are less so across Asia remains wide due to less-than-ideal environments for innovation and business growth, among other reasons.

According to the 11th Global IT Report, which was released by the World Economic Forum (WEF) and Insead on Wednesday, Singapore led the "Asian Tigers" pack comprising Taiwan, South Korea, Hong Kong, Australia, New Zealand, and Japan. The city-state's high NRI ranking was attributed to its strong political and regulatory environment and conducive business and innovation arena, it stated.

Among the other "Tigers", Taiwan came in at 11th place, while South Korea and Hong Kong ranked 12th and 13th, respectively. New Zealand and Australia were next at 14th and 17th, respectively, with Japan rounding off the pack at 18th.

By comparison, the "developing Asia" group was led by Malaysia, which ranked at 29th, while China and India were positioned 51st and 69th, respectively. The lowest-ranked Asian nation was Timor-Leste at 132nd, the Index stated.

The computation of the NRI was based on 10 "pillars", namely, political and regulatory environment; business and innovation environment; infrastructure and digital content; affordability; skills; individual usage; business usage; government usage; economic impacts; and social impacts.

Regulatory, political factors contribute to widening gap
The authors of the report--Insead's Soumitra Dutta and WEF's Benat Bilbao-Osorio and Thierry Geiger--pointed out that the Asia-Pacific region was home to some of the world's wealthiest, most innovative and digitized nations in the world, but these coexisted with some the poorest, least-connected countries, too.

Malaysia, for example, might be the top-ranked among the developing Asia group as it pursued a long-term plan aimed at achieving high-income status by the end of the decade, with ICT playing a critical role. This could be seen by its relatively high ranking in all government-related indicators, while businesses were also "quite aggressive" at adopting technology and increasingly innovative, they noted.

That said, the nation underperformed in the individual usage pillar, which constituted aspects such as mobile phone subscriptions, number of Internet users and households with Internet access, they added.

China's government, too, placed great hopes in ICT as a catalyst for future growth because more traditional growth drivers would dry up, the report noted. However, the Asian economic giant would have to overcome several challenges before it could more fully adopt and leverage ICT.

Its institutional framework and poor business environment, in particular, presented a "number of shortcomings that stifled entrepreneurship and innovation". These included excessive red tape and long administrative procedures, lofty taxation, limited or delayed availability of new technologies, and uncertain intellectual protection. For instance, an estimated 80 percent of installed software in China was pirated, the authors pointed out.

Further down the Index, four Southeast Asian countries--Thailand (77th), Indonesia (80th), Vietnam (83rd), and the Philippines (86th)--were identified by the authors as having disappointing performance.


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