By Pratap John
DOHA: The telecommunication industry has been driving the gross domestic product (GDP) of many countries and the sector’s growth is faster than the overall GDP expansion in Africa and many countries in the developing world, the International Telecommunication Union (ITU) has said.
Worldwide, the ITU estimates, the telecommunication service revenues have more than doubled between 1994 and 2004. The sector has also generated millions of jobs in the last decade.
In 1994 the worldwide revenue from telecommunication services stood at $517bn whereas in 2004 it totalled a whopping $1,216bn.
The telecom service revenues as a percentage of the GDP have had the fastest growth in Africa with 5%.
In comparison, the telecom revenue in Oceania region accounted for 4.5% of the GDP, Asia 3.8%, Europe 3.3% and the Americas 2.9%.
“This highlights the importance of the telecom sector for the African economy,” the ITU stated in its report on “The direct impact of the information and communication technology sector (ICT) on the economy” released at the ongoing World Telecommunication Development Conference here on Thursday.
In China, the telecom revenue grew from $25bn in 1998 to $64bn in 2004, the report stated.
India, South Korea and Australia have all seen doubling of their telecom service revenues during the period.
Still, the ICT manufacturing sector remains relatively small in some countries whereas it has expanded rapidly in others after the mid-90s.
An ITU research indicates that employment in the ICT manufacturing sector (as a percentage of total manufacturing employment) varies between 4.5% in Czech Republic and about 14% in South Korea.
The report said South Korea, Ireland and China have been able to create significant employment, boost revenues and attract investments through the ICT sector either by way of product exports or services.
Between 2000 and 2002, the ICT companies saw a bearish run with reduced investment and revenue growth. However, the revenues of three top ICT companies in the world totalled about $41bn in 2004.
“This was higher than the GDP of many countries including Tunisia whose gross domestic product accounted for $28bn in 2004”, the ITU report said.
It said the phenomenal growth of the ICTs has real implications for economic growth, in both developed and developing countries. The telecommunication service sector, which includes services related to fixed and mobile telephony and the Internet, is growing rapidly all over the world.
This growth, the ITU said, is being driven by both demand-side factors such as the increasing popularity of mobile phones and the Internet and by supply-side factors, such as regulatory reforms, falling costs and prices and technological innovation.
Several studies, the ITU said, have established the relationship between the rapid growth in ICT (particularly telecommunication services) and the resurgence of economic growth around the world.
There is an obvious link between a country’s GDP and its telecommunication penetration levels. |
