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   Table of Contents  
Executive Summary
Acronyms and Abbreviations
1. Introduction
2. Strategic Framework - Introduction
--> Strategic Framework - Main Areas of Focus
--> Startetgic Framework - The Arab ICT Strategy
--> Strategic Framework - Action Lines
3. PROGRAMMES
--> Programmes - Programme Details
4. Projects
5. BUILDING PARTNERSHIPS IN ICT
  
   CHAPTER  
5. BUILDING PARTNERSHIPS IN ICT

A.  Introduction

          The rapid growth and development of the ICT sector has resulted in a high rate of start-up businesses in developed countries.  Developed countries have managed to generate a steady flow of new, high-impact firms that create value and stimulate growth by bringing new ideas to the market through new technologies, new business methods or, simply, new and improved ways of performing new tasks.  Such firms do not emerge as a natural by-product of free-market institutions nor are they the result of any single factor.  In all instances, they are the result of a multifaceted system for nurturing high-impact partnerships and entrepreneurship.[1]

          In the ESCWA region, no such system is in place.  Reform focuses on macroeconomic issues such as finance and trade, institution building and the creation of sound banking systems, reasonable interest and exchange rates and stable tax structures.  It is anticipated that reforms will be introduced with regard to privatization, deregulation and investment in infrastructure and basic education.  In view of the fact that today’s economy is knowledge-based, partnerships, entrepreneurships and venture capital should be added to the list.

          In order to be of benefit, venture capital needs ventures to support.  National mechanisms to feed and sustain ventures are required.  Microenterprises tend to involve cottage industries that add little to the economy in terms of productivity or growth and are insufficient to ensure long-term prosperity, as is attracting outsourced work as such work tends to migrate to even lower-cost locales.  It is only when a nation is the initiator of new firms and partnerships based on new ideas that unique value is added and real opportunities are created.

B.  Guiding principles

          Based on the WSIS Call for Partnerships (Geneva 2003 - Tunis 2005), the following guiding principles for partnerships are proposed:

1.       Partnerships should be specific commitments by various partners intended to contribute to and reinforce the implementation of a specific objective or set of objectives.

2.       Partnerships should be voluntary and self-organizing, based on mutual agreed objectives and shared responsibility of the partners involved.

3.       Partnerships should have a multi-stakeholder approach and involve a range of actors in a given area of work.  Partnerships can involve governments, regional groups, local authorities, non-governmental and civil society organizations, international institutions and the private sector.

4.       Each partnership should define its intended outcome and benefits, have clear objectives and set specific measurable targets and time frames for achievements.

5.       Available and/or expected sources of funding should be identified.  At least the initial funding (seed money) should be assured at the time of launching the partnership.

C.  A model for establishing partnership and promoting entrepreneurship

Traditionally, partnership and entrepreneurial systems include four sectors of the economy, namely, high-impact entrepreneurs, large mature national, regional and international firms, governments and universities.  With regard to developing countries, it might be practical to modify the model to include banks and donors on one side and international and regional agencies on the other side, as illustrated in figure III.

Figure III.  The modified four-sector model

Source: Schramm, C. J., “Building entrepreneurial economies”, Foreign Affairs, July/August 2004, vol. 83, No. 4, p. 104.

          The modified four-sector model provides a useful framework for guiding policies to promote partnerships and entrepreneurship in the region.

Box 1.  Entrepreneurship examples from the United States of America (USA)

In 2003, approximately 11 out of every 100 working adults in USA were engaged in entrepreneurial activity, either starting a business or playing a lead role in one less than three and a half years old.

The USA is also unusual in that many of its big, strategically important corporations were created very recently. Dell and Cisco Systems, for example, were started in 1985 and 1984, respectively.  New firms have been national leaders in creating wealth and raising living standards.

Compare the birth of two industries: nuclear power and software.  Innovation in the first was driven mainly by big companies such as Westinghouse Electric.  By contrast, there was no software industry in the early days of computing.  Computer programmes were either custom written or sold along the hardware; writing and selling programmes separately was not seen as a viable business strategy.

_________________

Source: Global Entrepreneurship Monitor (GEM).

          With respect to the first sector, countries should establish the underlying conditions that allow the partnership and entrepreneurial process to flourish, favourable business policies and regulations and access to investment and human capital.  In many countries in the region, starting a business or partnership is often fraught with costly and time-consuming bureaucratic procedure.  A source of capital for new firms or partnerships is another important factor in this sector.

          The second sector includes mature national and regional firms.  These usually emphasize the privatization of state-owned companies and liberalization of local business environments in order to help existing firms.  However, more should be done to induce genuine symbiosis and partnerships between established firms and the new entrepreneurs with their orientation to small technology.  The private sector is also encouraged to contribute to research and development within universities in order to drive commercial ICT innovations.

          With regard to the third sector, governments should do as much as possible to invest in infrastructure that supports partnership and entrepreneurship.  They should also subsidize laboratories and testing facilities for shared use as young technology firms often need such facilities but cannot afford their own.  Incubators are one way of providing shared facilities which also encourages entrepreneurs to cluster around universities in particular cities, so creating a dense network of peers who can form partnerships and build inventories.

          The fourth sector highlights investment in primary and higher education.  In many countries of the region, governments are the main investors in education.  The links of the fourth sector to other sectors include research and development activities that could provide avenues for partnership.

          High-impact entrepreneurship and partnership are likely thrive in countries that pay proper attention to all sectors of the model.  The inclusion of banks and donors as well as international and regional organizations has no impact on the paradigm but, rather, provides additional possibilities for exploration.

          Cultural factors are not given adequate consideration in the four-sector model.  However, these could be taken into consideration on a project-by-project basis.  Developing countries should not worry too much about cultural intangibles as, in practice, culture can change as incentives and conditions change.  Encouraging partnership and entrepreneurship could be of greater benefit to countries in terms of long-term growth and gains in productivity.  Partnership and entrepreneurship coupled with innovative means of financing should serve as catalysts for change and could prove to be important forces for regional stability.

Box 2.  Iraqi networking academies partnership          

           After more than two decades of wars, sanctions and restriction on acquiring ICT, it is now imperative that ICT is fully utilized as soon as possible for communication, management, information, research and in the teaching/learning process.  The need exists to establish an electronic highway in Iraqi higher education institutions that will break the isolation of universities and technical institutions.

           In this context, ESCWA is at present implementing a project in partnership with Cisco Systems and four well-established Iraqi universities.  More than 40 networking academies are being established in a number of cities and towns in Iraq in order to deliver networking technology training to university students and IT professionals and prepare them for the tasks ahead in reconstructing the new Iraq.

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Source: ESCWA, Iraq Task Force, available at: http://www.escwa.org.lb/information/iraq/ index.asp.

D.  Modes of partnership

          Partnerships can take a variety of shapes and forms.  The most common form is national partnerships, although an increasing number of bilateral, regional and global partnerships are being encouraged between countries and private sector enterprises.  For numerous developing countries, partnerships involving international agencies and NGOs are also becoming widely recognized and encouraged. Partnerships can also be categorized according to types of stakeholders.  The most common form of partnership is PPP, although public-public, public-international and combinations of all elements also exist.  In all such partnerships, national or regional barriers should be removed.

          Partnership differs from traditional cooperation.  Partnership requires a vision and a business model before stakeholders will agree upon it.  It also requires well-defined targets and deliverables.  One of the main considerations for successful partnerships is financing.  Attracting investors and donors is an essential process and should not be undermined.  The following points should be considered:

          (a)   Sources for financing (national, regional, FDI);

          (b)   The role of banks;

          (c)   Venture capital, if the partnership is for a venture-type project;

          (d)   Calculations of return on investments;

          (e)   Marketing and promotion of ideas and projects;

          (f)   Incubation, for an initial period;

          (g)   Expected role of government(s);

          (h)   Legislative, regulatory and investment environments.

E.  Partnerships in the context of the WSIS process

          A considerable proportion of discussions at WSIS was devoted to issues related to partnership and financing of ICT projects, in particular for developing countries and countries with economies in transition.  Global partnerships were emphasized in the Geneva Declaration (WSIS-03/GENEVA/DOC/4-E) in the context of development for the attainment of a more peaceful, just and prosperous world.  Partnership and cooperation among governments and other stakeholders, namely, the private sector, civil society and international organizations, was also recognized in the Declaration.  Moreover, partnerships in research and development, technology transfer, manufacture and utilization of ICT products and services were identified as crucial for promoting capacity-building and global participation in the information society, in particular those partnerships between and among developed and developing countries, including countries with economies in transition.  The manufacture of ICTs presents a significant opportunity for wealth creation to all stakeholders.

          A structured dialogue involving all relevant stakeholders, including public/private partnerships, is recommended in the Global Plan of Action at the national level in order to devise e-strategies for the information society and exchange best practices.  Each country is encouraged to establish at least one functioning PPP or MSP by 2005 as a showcase for future action.  It also recommended that mechanisms for the initiation and promotion of partnerships among stakeholders in the information society should be identified at the national, regional and international levels.  Through the adoption of an enabling environment and based on broad access to the Internet, governments should seek to stimulate private sector investment, foster new applications and develop content and PPPs.  The Global Plan of Action proposes that PPPs should seek to maximize the use of ICTs in order to improve production in terms of quantity and quality.  They should also foster the creation of varied local and national content including that available in the language of users and give recognition and support to ICT-based work in all artistic fields.  Through PPPs, governments should also promote technologies and research and development programmes in such areas as translation, iconographies, voice-assisted services and the development of the necessary hardware and a variety of software models, including proprietary open-source and free software such as standard character sets, language codes, electronic dictionaries, terminologies and thesauruses, multilingual search engines, machine translation tools, internationalized domain names, content referencing and general and application software.  Media professionals in developed countries should be encouraged to establish partnerships and networks with the media in developed countries, in particular in the field of training.

F.  Regional status of partnerships

          Partnerships are heavily influenced by regional and national cultural, behavioural and historical values.  The ESCWA region has very few success stories in partnerships and regional actions and is also known to have investment patterns that favour investments in secure sectors such as estates and commercial trades.  Investments in industrial projects and venture-type projects, particularly in ICT, constitute a small percentage of investments as such projects have relatively slow rates of return on investment, combined with risk factors higher than other economic sectors.  In recent years, the Gulf Cooperation Council (GCC) countries have sought to forge business and industrial partnerships but none of these attempts have yet made a significant contribution to the region and none have been in ICT.

          Investors tend to invest outside the region in view of the political instability and lack of a favourable environment or legislation that could inspire confidence in investors.  In recent years, Egypt, Jordan and the United Arab Emirates have taken steps to encourage investments and partnerships in ICT projects.  In Egypt, such projects have attracted international companies, such as Microsoft and Cisco Systems in addition to national players, as partners in multi-million dollar projects to disseminate ICT throughout the population.  Examples of such projects include Free Internet Access and a PC per Home.  The Government of Jordan has facilitated partnerships between its software development sector and international companies and so multiplied the export of software products from Jordan to the developed countries.  Jordan has also been successful in partnership projects with United Nations agencies and the World Bank.

          Partnerships in Dubai assumed a different form.  The Government was able to implement e-government applications successfully by establishing partnerships between government institutions.  It was also able to host international and regional companies specialized in ICT or media technology in artificial towns created in order to offer tax-free havens, in Dubai Internet City and Dubai Media City, respectively.

          Partnerships with United Nations agencies, the World Bank and NGOs from various developed countries are also common in the region.  However, measures and benchmarks of success and sustainability are not always put in place for such partnerships.  This situation is notable in the case of Yemen.

          In surveying the state of partnerships, no striking examples of PPP in ICT were found at the national or regional level.  The short life cycles of many partnerships forged in the countries of the region call for remedial action.  However, some government-sponsored projects in the telecommunications sector, such as Arabsat and Thuraya, have developed into regional success stories.  The licence newly awarded to Emirates Telecommunication Corporation (Etisalat) that allows Etisalat to operate in Saudi Arabia could be considered as a form of regional partnership.  With regard to the funding of ICT projects, Injazat Technology Fund, which is a venture capital fund, is contributing to financing and developing ICT projects in the region.

          It is evident, when the digital challenges and opportunities in the region are considered, that governments and private sectors alike remain to harness these challenges and opportunities.  The countries of the region share a common language and culture.  Some are rich in oil resources while others are rich in human resources.  Nevertheless, not many projects have sprung up that took advantage of these values of strength.  Areas for possible partnerships and investment could include, but are not limited to, the following topics:

          (a)   A better integrated telecommunications backbone and network infrastructure with coordinated visions that enhance connectivity, affordability and knowledge sharing;

          (b)   The content industry;

          (c)   Government applications that better serve citizens and customers in the region.  Best practices and success stories in government applications in one country should be replicated in other countries of the region and so produce an effective multiplier of success.  Government applications could also have a regional integration dimension.  For example, an excellent area for multilateral partnerships is facilitating movements of trade, services and human resources between countries in the region.  The United Nations Conference on Trade and Development (UNCTAD) package that handles customs operations, Automated System for Customs Data, is a case in point;

          (d)   Other applications in areas such as e-learning, employment creation and poverty eradication.

          Conflict-stricken ESCWA members such as Palestine and Iraq, as well as the least developed country in the region, Yemen, deserve special attention when it comes to partnerships and investment schemes.  In the case of Iraq, the United Nations Development Group set up the Iraq Trust Fund to support reconstruction projects in Iraq.  A number of these projects have substantial ICT components that might be addressed through a variety of partnerships between government, United Nations agencies, the NGOs and the private sector.

          Partnerships should also be deployed in order to implement projects that aim to achieve the United Nations millennium development goals of empowering women and bridging the knowledge divide between rural and urban communities.  A number of large cities in the region suffer from an economic divide and, therefore, a knowledge divide between different social groups. Projects that address such issues should be encouraged for partnerships and investment.

G.  Proposed modality for RPoA partnerships

          The concept and structure of the RPoA highlights and builds upon partnerships with a multitude of development agencies, NGOs and private enterprises with a view to building a sustainable information society.  Programmes and projects at the core of the RPoA are specifically designed to foster and catalyze partnerships in ESCWA member countries and induce the interactive participation of a broad spectrum of stakeholders.  The present modular design of the RPoA is flexible and allows the substance and scope of its components to be extended through the addition and reformulation of selected modules as required.  As such, the RPoA can evolve in order to assimilate future regional and national needs and particularities and provide mechanisms for national, regional and sub-regional partnerships.  However, the RPoA will need to be invested with effective operational modalities.  Such modalities are provided, to a large extent, through a regional ICT partnership initiative, described in section two below.

1.  The suggested modality

          Once programmes and projects are agreed upon, it is important to develop a permanent mechanism that can trigger the formation of partnerships and seek the required funds through a robust and comprehensive approach that is both systematic and focused.

          All projects start with an idea or an articulated concept and gradually mature into a solid project proposal.  A project cannot reach maturity on its own, in particular in the case of regional, MSP or PPP projects.  Hence, many project ideas will not materialize and so never be launched before such maturity is reached.  The phase before the commitment of partners is secured is the most difficult as it entails the greatest effort and requires will, persistence, vision, leadership and strategic relations as well as seed finance.  Building partnerships is a task that requires considerable expertise and robustness.

2.  ICT Partnership Initiative

          According to the Damascus Call for Partnership[2] and amongst other mandates, ESCWA together with other key regional organizations is required to:

          (a)   Follow-up on implementation of the RPoA;

          (b)   Intensify cooperation with other regional organizations;

          (c)   Provide consultative services to member countries in areas related to implementation of the RPoA;

 

          (d)   Formulate a mechanism for partnership through an interactive Internet web site for activating partnership and creating an effective space of interaction among stakeholders in order to attract new partners and support continuous dialogue and timely progress reporting and evaluation for effective implementation of RPoA programmes and projects.

          In view of the above, it is important to establish a permanent mechanism for triggering the coherent formation of partnerships through aggregating vision, leadership, finance, strategic relations and project management expertise.  It is essential to launch a regional partnership initiative in order to achieve the following objectives:

          (a)   Broad implementation of the RPoA;

          (b)   Activation of ICT partnerships;

          (c)   Provision of a framework and process through which project maturity can be achieved;

          (d)   Mediation and catalysis of the process among stakeholders;

          (e)   Seeking finance for projects earmarked by governments and major stakeholders.

          In organizational terms, the initiative could take the form of a virtual consortium, representing a number of initial key strategic partners and possible further strategic partners that would eventually evolve into a multilateral consortium of major stakeholders.  Such a consortium would need to be highly autonomous, with its own steering committee and programmes, in addition to a dedicated secretariat.  The consortium would be engaged in the following core activities:

          (a)   Development of a strategy document for each programme;

          (b)   Conduct of a country status review for each programme;

          (c)   Selection of programme management coordinators;

          (d)   Identification of potential partners from different categories;

          (e)   Presentation and promotion of different projects in major events and with donors;

          (f)   Negotiation of the required agreements until the project reaches the formation stage and the project management team is appointed;

          (g)   Monitoring of programme management teams operation;

          (h)   Provision of evaluation, feedback and reporting to strategic partners.

           The proposed modality incorporates a mechanism for reaching project maturity and, periodically, monitoring progress of work, evaluating results, sharing failures and successes and building a knowledge repository.  An illustration of the proposed mechanism is provided in figure IV, below.

Figure IV.  The ICT Partnership Initiative

 

          The components of the mechanism illustrated in figure IV are summarized in the following paragraphs.

(a)     Steering committee

         The initiative would be directed at a high level through a Steering Committee, acting in the capacity of a board of directors, that would provide vision, set directions, articulate policies, design maturity frameworks and introduce alterations to the plan, as required.

(b)     Secretariat

          The Steering Committee would be assisted by a Secretariat responsible for management activities, coordination between the various programmes and monitoring administration progress periodically.  Secretariat activities would include the preparation and drafting of all paper work including reports to key stakeholders, requests for resources, approval of disbursements and correspondence with various parties.  The Secretariat would consist of a small group of administrative and project management staff.

 (c)     Programmes

          Every programme should have a consultative team consisting of a programme coordinator, an expert in the field and a research assistant in order to focus on the details of the projects under each programme and so accord more attention to project formulation and promotion, as well as partnerships development.  The consultative team would also work, during the lifetime of a project, on creating synergy between established projects and new ideas or project proposals when they emerge, which would contribute to avoiding duplication and inefficiency.  Progress and evaluation reports would be submitted to the Steering Committee periodically.

(d)     National and sub-regional coordination

          National and sub-regional coordination with each member country or clusters of countries is required in order to ensure the success of the initiative as a whole, in order to provide an interface between the different programmes and a given country or sub-region.  Such coordination is essential in order to validate project ideas, monitor progress on the ground and liaise between project management teams and the various players at the a country or sub-region level, whether these are governments, the private sector or NGOs.

(e)     Online partnerships space

          In addition to human expertise and the framework, the initiative will be heavily reliant on an online forum in which feedback and comments about programmes, project proposals and funding opportunities can be presented and solicited.  This forum could be called ICT Partnerships Online (IPO) and would deliver the following functions:

          (a)   Online subscription of stakeholders to update/add programmes and projects to the RPoA;

          (b)   Identification of partners and funding agencies for projects;

         (c)   Creation of partnership networks that bring together governments, universities, mature firms, banks, donors, NGOs, and international/regional organizations;

         (d)   Digital platform for the development of comprehensive project documents, completion of partnership subscription to projects and securing of necessary funds until the level of maturity necessary in order to start implementation is attained;[3]

          (e)   A medium through which project management teams and stakeholders can exchange information on progress of work and achieved results and share successes and failures;

          (f)   Development of a knowledge management repository in order to foster the continuous creation, accumulation, use and re-use of organizational and personal knowledge.

          The IPO forum could also host articles, reports or studies on range of themes related to programmes and projects.  Upon reaching maturity, each project would become an independent entity and would be encouraged to use IPO as a communication tool, in order to provide guidance and feedback to governments and stakeholders as well as exchange information and build the knowledge management repository.  The partnership network would allow project stakeholders to mitigate the financial risks involved when exclusive partnerships with current donors come to a sudden end.  Moreover, the knowledge management repository would empower project management teams with information that would contribute to avoiding duplication of efforts and the tools for reducing inefficiency.

          Initially, incentives should be devised that could increase participation in the partnership network, for example through the provision of advertising space on the web site, issuance of a monthly electronic bulletin on projects and achieved results with brief announcements about new participants.[4]  As the number of stakeholders contributing to the IPO forum increased, the content of the forum would become richer and more valuable as it would increasingly attract strategic partners and funding agencies.  The proposed IPO forum would require funds in order for it to become autonomous and self sustainable.  Securing seed money at the time of launching the initiative would be vital to covering the expense involved in setting up the web site, online forum, partnership network and knowledge database.  Marketing expenses, operational charges, management and consulting fees should also be taken into consideration, along with the provision of the seed fund.  The launch of an IPO forum for promoting and networking interested partners and investors in the implementation of the proposed projects should become more dynamic when such funds are available.

          The business model for the IPO forum would eventually progress to charge fees for added value services, as part of the shift away from relying on development aid towards more sustainable operations based on cooperation and partnership.

          Figure V provides an illustration of the proposed online space for ICT partnerships.  As depicted on the far left of the diagram, the list of programmes and projects of the RPoA would be constantly updated and appended through online subscription services and an online forum.  With proper initial incentives, this process would have a multiplier effect as the IPO would attract funding agencies, develop its partnership networks, and establish online “communities of practice”, representing government, the private sector, universities and regional and international organizations, so that domain experts in the respective ESCWA member countries could address specific issues related to a given programme or project.  The IPO forum would serve as catalyst to galvanize partnership formation and increase the chances of successful project implementation, so contributing to the development of the information society in the region.

Figure V.  Online partnerships space

Source: ICTD, ESCWA.


[1]    Schramm, C. J., Building Entrepreneurial Economies, Foreign Affairs, July/August 2004, vol. 83, No. 4, p. 104.

[2]    Available at: http://www.escwa.org.lb/wsis/conference2/outcome.html.

[3]    Project maturity is reached once the following steps have been completed: (1) preparation of detailed project document with strengths, weaknesses, opportunities, threats (SWOT) analysis; (2) promotion campaign and pledging for funds; (3) commitment of one or more parties to the project and the creation of a partnership; (4) provision of seed money for a pilot implementation phase or initial phase of the project; (5) designation of a project manager.

[4]    It would be ideal to secure some seed money to contribute to programme and project development.



  
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