In addition, the majority of internet use comes from tertiary schooling (Adeya & Oyelaran-Oyeyinka, 2004; Aduwa-Ogiegbaen & Iyamu, 2009). That being said, Nigeria does has a group of users with demand, however large or small it may be. This means that Nigerian government not only needs to invest in purchasing updated technology but also offer a stimulating environment consisting of educated users and teachers and jobs to encourage growth and revenue of the sector.
The current state of Nigeria’s education system is in neglect, leaving little concern for educational support for computers. Only twenty-nine percent of the population goes on to secondary school — that is, only twenty-nine percent goes on past the fifth grade (Wikipedia, 2012a). Warschauer (2003) blames the poorly structured social systems of developing countries for the digital divide effects. It is this lack of social support (organizations, programs, relations, etc.) that prevents users from learning the new behaviors of modern technology (pg. 211). A study of a university town in Nigeria also shows that poor internet services and inadequate education or skills prevent users from utilizing the internet (Ani et al., 2010, pg. 362). Nineteen percent of surveyed users say poor internet services affects their access while eighteen answered skill.
Education and support are interdependent on each other. Since a large portion of Nigeria’s population is illiterate, they can only use computers through intermediary, skilled helpers. Unless there is a large number of skilled volunteers, programs must be set up to train those intermediaries and compensate them. This means that economic policy needs to create jobs within the IT sector to promote and expand the knowledge of computer. Nigerian policy makers must address the lack of jobs, growth and competition concerning computers and the internet. Even if the Nigerian government were to reform education policy, without a substantial job market and adequate equipment investment education and community programs will not be effective.
iii. Socio-Economic Standing
As stated earlier, the digital divide often times discriminates and exploits the inability to connect the internet. There are hundreds of social and economic traits that can influence internet penetration rates of an area. The most common, however, are gender, education and skill level and income level.
Age and marital status are becoming more important factors, as single, younger generations are more eager to subscribe to new technologies. The vast majority of Nigerian internet users ranges from 16 to 25 years of age, going up to 45 years old (Ani et al., 2010, pg. 361). In addition, seventy-five percent of users were single — which makes sense since most users are under 25 years old. This means the majority of internet users are perfect candidates for secondary and tertiary education. Perhaps Nigerian policy makers should include financial assistance programs and tax breaks to encourage computer education.
Aduwa-Ogiegbaen and Iyamu’s studies (2009) in Nigeria along with that of Ani, Uchendu and Atseye (2010) yielded varying results based on certain characteristics. Their research showed that men in Nigeria have higher internet penetration rates than women (based on their dominance in science and technology related areas. In addition, rural, poorer areas tend to have little to no access to simple infrastructure like electricity, let alone computers and internet. Those with less income also could not afford the fees and subscriptions of the oligopolized telecommunications marketplace.
Nigeria’s low GDP and economic standing also inhibits the ability to afford ICT infrastructure and support for internet policies and programs (World bank, 2002). An empirical study by Dasgupta, Lall and Wheeler (2001) also shows an elastic relationship between income and subscription to telecommunications (pg. 10). That is, the effects of a change in income will greatly and directly affect the behavior of subscriptions. The results also show that network economies in urban areas are those of scale. Urban areas have higher penetration rates as well as more advantages for the private sector (Dasgupta et al., 2001, pg. 11;Aduwa-Ogiegbaen & Iyamu, 2009). Surprisingly enough, however, if all other constants remain the same from country to country, “there is no gap in Internet intensity (subscriptions per telephone mainline)” (pg. 15). These authors all have substantial arguments and supporting evidence but isn’t poor socio-economic status a result of insufficient government fiscal policy and national growth? Without changes to Nigeria’s economic policy, commercial growth will not happen and, therefore income per capita will not increase to a level that can sustain reasonable internet penetration rates. Thus, socio-economic factors point to a larger problem: national fiscal policy.
iv. Economic Policy Reform
Government policy is arguably the most influential on a nation’s operations — including its IT investment. Dasgupta, Lall and Wheeler (2001) explain the mobile telephone growth (which they cite as a “promising new platform for internet access”) in the 1990s was due to “privatization and deregulation of telephone systems” that led to “accelerated access to telecom services in many developing countries” (pg. 7). They further state “countries with liberal economic policies enjoy a significant growth advantage” (pg. 8). Warschauer (2003) advocates the need for a “more informed policy and research agenda” in developing countries (pg. 210). He stresses the importance of creating policies which create synergetic support from the local and federal governments. An economic policy that stimulates competition and growth of the IT industry is crucial if Nigeria wants to expand its internet usage. Privatizing and decentralizing the sector while giving incentives to smaller companies that can offer competitive prices and equipment will ensure a stable and fair market for Nigerian consumers.
Ani et al. (2010) also spend a significant amount of time discussing the need for government reform. The main problem, they argue, is the lack of support to sustain growth of telecommunications and internet in Nigeria. Policy makers have neglected the growing need to facilitate access for institutions, libraries, schools, etc. Furthermore, the poor state of infrastructure and traffic congestion is due to an inadequate amount of internet exchange points, which government should be trying to reverse. Finally, “Decentralized internet access should be provided” for more abundant internet use (pg. 364). By reforming economic policy, Nigeria’s government can invest in new technologies and infrastructure which, in turn, will stimulate excitement and encourage Nigerians to learn about, adopt and use the internet more frequently.
Akinsola et al. (2005) also urge that the Nigerian problem lies in the hands of policy makers. They claim it is the responsibility of government to provide a supportive environment for internet growth, while encouraging the use of ICT infrastructure and to reform policies that facilitate improved use, support and access to internet services (pgs. 16-17). Thus, economic policy provides the answer. If the Nigerian government can reform its economic policy to digress from the monopolized culture of its information sector and towards a capitalized, competitive market, Nigerians could have a better chance to harness the benefits of internet penetration.
The World Bank (2002) also emphasizes policy reform as a factor that has the ability to facilitate the most growth in internet penetration in developing nations. This includes a competitive industry and regulatory framework (pg. 17). In addition, a study suggests that economic policy change in Africa “could double the number of [telephone] lines per capita” by privatizing the market, which increases competition, and employing good regulation practices (as cited pg. 24). Thus, providing an adequate economic policy will increase the accessibility of the internet throughout countries like Nigeria.
And although Adeya and Oyelaran-Oyeyinka (2004) emphasize the importance of socio-economic factors mentioned previously, they also acknowledge the significance of economic policy and its effects on those factors. From an empirical analysis of African countries and respective internet penetration, they note there is certainly a “correlation of wealth and Internet diffusion” (pg. 72). The authors also mention that the internet-rich countries like the US have been supported by federal and state policies (pg. 81). The correlation between wealth and internet penetration refers to the income level at the individual, organizational and national scales. Hence, there is an extreme need for economic policy to afford opportunities for increased income levels across the board. At the individual level, low income means average Nigerians cannot afford to pay for the equipment and internet subscription fees. At the organization level, institutions, programs and companies that would like to offer internet services will not be able to due to such high ISP subscription fees and telephone costs without sufficient disposable income. And on a national scale, if a country cannot even provide reliable utilities to each citizen, it will most definitely not be able to afford the investment in the simplest internet infrastructure. (pgs. 79-80). Outlining these difficulties, it is easy to see that internet penetration is especially difficult a problem for poor countries. Countries in this predicament, like Nigeria, will need to create local and national growth via reformed economic policy in order to overcome low internet penetration rates.
Aduwa-Ogiegbaen and Iyamu (2009) concur. The inequalities caused by digital divide, they argue, “Needs to be addressed and redressed by government” (pg. 79). Without a positive relationship between government and education stakeholders, the gap between poor and wealthy communities and their respective internet use will widen. A good economic policy will increase Nigeria’s GDP and overall income per capita. Hence, there will be bigger investments in infrastructure, increased access and a smaller gap between rich and poor areas. A study by Byrom (1998) showed a correlation between the amount of technology support and the development of technology diffusion (as cited Aduwa-Ogiegbaen & Iyamu, 2009, pg. 81). Although unspecific, this provides qualitative evidence that policy does in fact directly effect the rate at which internet diffuses through developing nations. Thus, in order to increase internet penetration and bridge the digital divide, Nigeria needs to create an economic policy that supports the existence and development of IT and internet usage by way of privatizing the sector, decentralizing the internet, eliminating monopolies in the telecom industry and making substantial investment in ICT infrastructure.
Historical Examples
Overcoming Digital Divide in South Africa
South Africa is one of the few African countries that has been able to overcome the effects of digital divide and establish a significant, effective use of the internet. South Africa is a great country to look at in the context due to its own history of apartheid, geographic proximity and success of IT development. However, the country has made an initiative over the last twenty years to overcome the negative connotations and create a diverse and stimulating economy via economic policy reform.
About twenty years ago, South Africa and Nigeria were in very similar economic and cultural situations. South Africa, however, realized more quickly that its opportunity for growth was within the emerging information era. South Africa connected to the internet in 1991 with a link connecting Rhodes University to Randy Bush’s personal home computer in Portland, Oregon after being granted a CcLD in 1990. The country’s internet was commercialized in 1992 offering licenses to business and private users. Today, South Africa makes up more than sixty percent of Africa’s internet users and has a higher GDP than Nigeria (Wikipedia, 2012b; World Bank, 2012b). But if South Africa and Nigeria were at one point so evenly matched, what changed? During the 1990s and 2000s, South Africa initiated a drastic reform in economic policy.
Unlike Nigeria, South Africa’s economy is comprised of a wide variety of industries, including the telecommunications sector, which is the country’s fast growing. Following the Telecommunications Act of 1996 and its amendment in 2001, the South African Government radically reformed its economic practices to allow for growth. This included increasing competition to reduce prices, restructure the market from vertical to horizontal, granting more licenses to new telecommunications companies, decreasing tariffs to encourage competition, creating new jobs, liberalizing the marketplace and reducing barriers to entry into the telecommunications industry (Wikipedia, 2012b; Horwitz, 1997). With these changes, South Africa was able to develop its economy and create a much more advanced market than that of other African countries (Adeya and Oyelaran-Oyeyinnka, 2004, pg. 71).
In addition, White and Green Papers were put forth which outlined a multitude of additional policy changes. The proposed economic policies granted exclusive rights to Telkom, the major telecommunications company, for a period of time in order to expand its services throughout the country. Additionally, the papers called for market regulation, deregulation of the telecom sector, reduce tariffs on companies and open the market to universal competition seven years down the road (Horwitz, 1997, pgs 70-71). The papers enforced the policies introduced in the Telecommunication Acts of 1996 and 2001 and allowed the IT sector to expand rapidly.
The national government also used standard economic practices to encourage growth and competition within the industry. Lowering interest rates allowed more companies to compete in the market and individuals to access internet services and equipment. By increasing the amount of exports, South Africa also recognizes increased revenue and therefore GDP. According to the World Bank (2012b), South Africa is in the upper middle income level with a GDP of $408.2 billion versus Nigeria, who is in the lower middle income bracket with a GDP of $235.9 billion — clearly showing South Africa is doing something right. Additionally, the national government borrows from other countries and lenders to fund support programs for users, expand the public sector and increase connectivity by investing heavily in ICT infrastructure (Wikipedia, 2012b; Southafrica.info, 2012; Horwitz, 1997). All of these policy reforms have allowed South Africa to harness the benefits of the internet and its respective industry.
South Africa’s example proves that by reconstituting national fiscal policy, previously unconnected countries can overcome the limitations of digital divide and utilize the internet to create and sustain growth.
Nigeria’s Internet
In 1987, the 32nd Ministerial Council of National Council on Education created the Nigeria National Computer Policy to encourage children to use computers and eventually lead to growth. A year later, the council introduced Computer Education into the tertiary schooling atmosphere as a topic of study (Wikipedia, 2012a). In 1996, the Nigerian Communications Commission licensed thirty-eight Internet Service Providers (ISPs) to begin Nigeria’s internet which lead to fully functional internet services in 1998.
It is no coincidence the emergence of a new internet came just a year before Nigeria became a democracy, ending a thirty-three year military rule. The new goal was to model the Federal Republic government after that of the United States’. Newly elected President Olusegun Obasanjo then expressed support for ICT infrastructure in 2000 aiming to “reduce the gap created by the digital divide and strife to close the gap between the haves and have-nots” (Ani et al., 2007,
p. 357; Akinsola et al., 2005, pg. 29). ICTs are Information and Communications Technologies, which are the basic infrastructure that make internet access possible (Aduwa-Ogiegbaen & Iyamu, 2009, p.74). While Nigeria did in fact experience the biggest growth in internet penetration during Obasanjo’s term, the divide still remained pertinent. Like South Africa, ethnoreligious conflicts tore the nation apart for years. The conflicts drew attention away from internet connectivity for most of the early 2000s.
Additionally, due to the developing nature of the country, Nigeria’s GDP has never been very competitive on a global scale, stymying its chances to overcome the effects of digital divide. As mentioned earlier, Nigeria is considered a lower middle income country with a GDP of only $235.9 billion. And, contrary to South Africa, Nigeria relies heavily on the oil trade (Wikipedia, 2012a). Because of this dependency, oil companies will continue to see economic benefit while other sectors, such as information technology, will struggle or remain nonexistent. The only way Nigeria will bridge the digital divide is to shape a new economic policy that is not central to oil trade. Nigeria will need to expand the minuscule telecommunications industry that is currently in place to create economic growth and more jobs.
With such poor economic standing, Nigeria’s government also does not have as much funding to allocate to internet support programs and infrastructure, given its other problems, as more developed nations do. But in an announcement by Citigroup in 2011, there remains hope. The announcement forecasted Nigeria will experience the highest growth in GDP between 2010 and 2050 (Weisenthal, 2011). This anticipated growth may be the turning point that leads to the expected tripling of internet access which can help “exploit opportunities for trade, investment and finance” (Akinsola et. al., 2005, pg. 32). With the increased GDP they are forecast to see, Nigeria needs to create a fiscal policy that can support and sustain the growth.
A successful economic policy addressing Nigeria’s digital divide should include several things. The first of which is providing an incentive for corporations to compete in the market. By reducing taxes/tariffs, government subsidies and/or providing legal assistance, ICT and telecommunication companies will be encouraged to offer more services throughout disadvantaged areas with better quality and lower prices. This type of policy will in turn redistribute “socio-economic development that will enhance the income of all citizens” (Akinsola et. al., 2005, pg. 33). Reducing the barriers to entry into the market will help increase competition as well. This can be achieved with the incentives just mentioned for new companies entering the industry or through deregulation of the telecommunications sector, which is another vital part of expanding the industry.
For Nigeria, deregulation should be a crucial addition to fiscal policy reform. Decreasing state requirements facilitates an increased number of license approvals. Liberalizing the sector through deregulation potentially opens the Nigerian telecom industry, and hence its national economy, to corporate and individual investors. For example, deregulation creates excitement and encourages small, private business owners, like those of cyber cafés, to invest in the effort to bridge the digital divide (Akinsola et. al., 2005, pg. 29). As seen by the successful implementation of deregulation in South Africa, loosening strict requirements causes more competitive services, prices and availability. Ultimately, Nigerian consumers will be the most affected benefactors with increased accessibility and affordability.
Affordability is of major concern in the fight against digital divide. According to a study by Adeya and Oyelaran-Oyeyinka (2004), “cost ranks highest in Nigeria” as the biggest constraint to internet accessibly (pg. 78). The cost of local dial-up in 2002 was approximately sixty dollars per month for twenty hours! And that is excluding telephone line rental. To put this into perspective, at the same time, the average cost of the same type of dial-up internet service was “less than half… including telephone charges” (pg. 71). The high costs of accessibility are due to the outrageously high costs incurred by the service providers. Service providers in Nigeria pay for ISP subscriptions, which range anywhere from ten to eighty dollars, tariffs, regulatory and licensing fees, international bandwidth access and backup power supply units (due to frequent power outages incurred from lack of infrastructure) (pgs. 71, 80). In order to address the issue of cost, Nigerian economic policy needs to stimulate job and income growth and invest heavily in infrastructure, fundamental and ICT.
Investments by the government and private investors may be the most influential factor of reformed economic policy for Nigeria. Aduwa-Ogiegbaen and Iyamu (2009) note investments in modern technology will “translate into the production of future citizens that will be high flyers who can make positive changes to the social, political and economic development of [Nigeria]” (pg. 84). Thus, investments in IT will lead to a more skilled work force, increased efficiency within current sectors and increased income for the nation and citizens alike. Investing in additional ICT infrastructure will also increase the amount of access points throughout the country, bridging the gap caused by digital divide.
However, in order to get to that point, Nigerian economic policy must first address poverty stricken areas that lack infrastructure at all. As discussed earlier, many scholars argue accessibility is a cause of digital divide. Government investment in basic electric and plumbing infrastructure will make it possible for poor, rural areas to sustain the existence of ICT and internet and eliminate the issue of accessibility. By spending tax and trade revenue on ICT investments, Nigerians will not only be able to have increased accessibility to the internet; they will also have more jobs, better education and community programs and a better economy leading to higher income per capita and better qualities of life. If implemented correctly, reforming the economic policy in Nigeria can help suppress the effects of digital divide and ultimately lead to a more prosperous economy and better quality of life for its citizens.
Discussion
As I stated earlier in this paper, I use the term ‘economic policy’ as an umbrella term that affects all the issues aforementioned. Economic policy is the influencing factor on nearly every operation of a country. In Nigeria’s case, much of the country’s early internet history has been stifled by cultural conflict and poor economic standing. With a more peaceful state and economic growth on the horizon, Nigerian policy makers should focus on reform. Economic policy needs to address the needs of capitalism. Policy reform must also address the GDP and Nigeria’s type of economy. Heavily relying on the oil trade will ultimately stymie the country as other nations will grow and develop by means of information and internet technologies. In the coming age, Nigeria is expected to develop into a higher income country (Weisenthal, 2011) and many of the new changes and challenges will be foreign to them. The new democratic model of government should help them transition more smoothly into a more electronic, internet driven era. Economic policies will need to be more liberal and embrace more of a capitalist economy as opposed to the military ruling monopoly that had consumed the nation for more than thirty years.
Developing nations, more than any other affected by digital divide, need to acknowledge the importance of economic policy. Like Nigeria, developing countries tend to have massive untapped potential due to poor economy, poor world ranking and lack of primary infrastructure. In order to overcome those factors, economic policy must be reformed. Infrastructure investment, job creation, educational grants, tax and tariff reform and competitive, stimulating markets must all be primary factors of such policy. The internet has already enabled other countries, like South Africa to become global competitors due to investments in IT. If developing countries follow trend, who knows what kind of technologies and global economic environments will exist in the coming decades.
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