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Symposium 2008

Proposal - ICT’s contribution and essential policy steps towards a globalised network economy

The Challenge

Many people in the developed world are not participating in the growth of the world economy. In some countries, unemployment remains high, whereas others suffer from the problems of the working poo ...

Many people in the developed world are not participating in the growth of the world economy. In some countries, unemployment remains high, whereas others suffer from the problems of the working poor. What are the most effective policies for creating employment – particularly in well-paid, satisfying jobs – in OECD countries?

Information and communication technologies (ICT) have been the major driving force for new enterprises, new services and major new developments in production in recent years. ICT contribute about 40 percent of productivity growth and one quarter of overall economic growth in the European Union. The economic benefit it creates is most significant in explaining employment growth. ICT is key driver of economic growth because it increases productivity and generates new consumer services within the sector, but most of all it creates additional employment in interrelated industries.

The communication-sector significantly contributes to the development of worldwide economies. Telecommuni¬cations bridge distance and boost the attractiveness of remote and rural areas. Telecommunication technologies enhance the diffusion of information, knowledge and innovative contents, applications and services regardless of geographic location. Clearly, telephone and Internet improve quality of life and people’s ability to participate in social and democratic life. Furthermore, telecommunications provide the essential infrastructure for increasing

e-literacy, alleviating the digital divide. Societies are becoming increasingly chances of powerful and innovative electronic communications networks and services.

The liberalisation of the European telecommunications markets has been a major success. Today, we experience more choice at lower rates and better services for the consumer. However, in particular Europe has to be careful about its current review of the Telecommunications Directives and its general telecommunication policy: the EU-25 telecom market value has experienced a distinct slowdown. Overall growth will reach about 2% in 2008 but is expected to weaken further in 2009. In contrast, the US telecom market value is still about 6 % and China about 10%. For Europe, the telecommunications industry outlook is gloomy because it lacks of significant investments in new infrastructure and consequently innovations. Without a modern infrastructure, value creation will shrink in the ICT industry with corresponding disadvantages for jobs and productivity. Three preconditions need to be met to tackle major economic problems, in particular in Europe: First, investment in new infrastructure is essential to keep up with productivity in the most competitive regions in the world – above all, in fibreglass networks. Second, the efficient use of currently freed spectrum for broadband services is crucial to achieve and connect rural areas as much as less developed regions. Third, an ICT industry that is competitive on a global scale must be built by suitable policy incentives, legal certainty and a new regulatory framework.

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