CEO’s tell the reality at e Asia

Rohantha Athukorala

It is estimated that by the end of the year, one in five households or 422 million households across the world will be wired up even though Sri Lanka’s penetration of broadband remain at a low ebb. The French constitutional council has revealed that access to the internet is a basic human right.

This means that Sri Lanka will have to spruce up the drive on IT, so that we keep pace with the world that is fast getting wired up. It is said that democratic learning will happen only when democratic access to the internet happens. Which means that Sri Lanka’s thrust in the rural areas must become a priority specially in the area of broadband connectivity.

Low human capital

The CEO of hSenid commented on the low human capital that is available in Sri Lanka which is hindering the development of the BPO sector. This is incidentally very important from a more strategic sense given that a study done by the World Bank economist Shantanu Devarajan had revealed that there was a similarity between Sri Lanka and Ghana who have fallen short of their potential due to not developing ones’ main resources. In the case of Sri Lanka it was the high human resources availability and in the case of Ghana were the rich mineral resources.

The story goes that in 1962, both Ghana and Sri Lanka had higher per capita incomes than the Republic of Korea. But today, Korea’s average income is twelve times Sri Lanka’s and 30 times Ghana’s.

The reason identified was that Sri Lanka and Ghana are unlike Korea. In the African case, the endowment of natural resources such as oil and minerals was estimated at about $600 billion and if properly commercialized this asset would have yielded even a five percent rate of return that would have resulted in generating an income equivalent to seven percent of GDP every year.

Instead, the per capita income of Africa’s natural resource producers has been very low. Sri Lanka does not have many natural resources, but it does have a huge asset in its human resources-reflected in the high levels of literacy but it has failed to latch on to the IT/ICT boom of India which once again reflects the step change in development that is required.

Low penetration

Another key point discussed in depth was the low penetration of computers. Intel Regional Director was in the view that with the mobile phone usership increasing to one in two people having a mobile phone in Sri Lanka in effect a 50 percent plus penetration to internet access will become a reality. However, once again the

challenge is if this access will be only to facebook and e-mail or will it improve the productivity of the nation is the million dollar question that I guess Sri Lanka will know only in the years to come.

Telecom sector profitability

In the telecom sector, the area highlighted was the Industry Profitability being in the red and how ICT can help make this industry profitable. The Transformational Specialist in Sri Lanka the Mobitel CEO said that the new product e learning on broadbased connectivity was a key initiative that can propel the organization to differentiate than being dragged to the bitter price war in the market place.

Now the challenge is how the product can be diffused in the market place with the help of the Nenasela distribution mechanism.

However, the challenge is that the school curriculum must incorporate this aspect into the examination system. The logic being only what gets tested in a system gets done. The “One laptop for each school-going child project” will be a strong enabler.

Korean Experience

The highlight of the “CEO Conclave” was the thought provoking statement by the Korean Ambassador who advised Sri Lanka to have a dedicated Ministry for ICT and a University exclusive to the development of ICT and its supporting subjects but linked to the business sector in Sri Lanka based on the Korean Experience.

This point directs Sri Lanka that the knowledge economy needs to have a commercial output.

This includes greater penetration of the viral networks, Voice Over Internet Protocol Service, Home network services, Telemetric services, and digital TV service. This gives us the strong integration that ICT’s must have with the commercial sector so that any investment that happens in Sri Lanka leads to a commercial context. I strongly recommend that given that there has been a considerable investment on ICT’s in the last five years and strategic view is taken and an evaluation is done what impact has these investments brought into Sri Lanka. However, the evaluation is not on the number game of international ranking but it should be on productivity and financial parameters from a business sense.

Another point highlighted by the Korean Ambassador was that the ICT industry must be financially viable and a critical mass needs to come in so that a commercial organization that drives this industry makes enough money to re-invest on R and D. The best example from Korea was Samsung and LG.

These companies linked themselves with many small and medium scale entrepreneurs (SME’s) that resulted in the development of a community focused on integrating ICT’s to the business sector.

If this does not happen there cannot be a strategic drive in this sector is my view.