The digital divide is the gap between those who have ready access to internet and the devices that facilitate online connectivity and those who do not. This divide is referenced within countries and also between countries and across regions. Here in Asia and the Pacific, there remains a vast range in rates of internet connectivity and mobile phone penetration between countries—with the digital divide as large as anywhere else in the world. The significance of this rests in no small part on the relationship between advances in information and communication technologies and positive socioeconomic transformation.
This spotlight on Laos is the first of an occasional series on POPSDev of those countries at the lower end of the divide in our region.
State of Play
Data on internet connectivity tend to be unreliable, but the latest data suggest that internet connectivity in Laos has risen to a high estimate of 35 percent from a low estimate of 22 percent over the last year. Using the lowball 2017 figures, this represents the fifth-lowest rate of internet connectivity in Asia, with Laos bettering only Tajikistan (21%), Turkmenistan (18%), Afghanistan (12%) and North Korea (almost zero).
Broadband penetration is estimated at only 0.4% as of 2017. And the price of mobile broadband is by far the highest in Southeast Asia when taken as a percentage of Gross National Income in each country.
But there are promising indications that Laos is on track, albeit it a slow and steady pace, to catch up with its neighbors. In the year from January 2016 to January 2017, Laos saw an impressive 83 percent growth in internet user numbers. The figures cited above suggest further impressive growth from 2017-2018. There are an estimated 6.3 million mobile connections in a population of 6.9 million people; active mobile internet users are estimated at around 32%. And the UN Economic and Social Commission for Asia and the Pacific estimates that the projected total growth of bandwidth demand from 2016-2020 will be higher in Laos than any other country in Southeast Asia.
As a further important foundation, Laos is strengthening its telecommunications infrastructure. But one significant factor hampering progress in the telecom sector is the slow rate of regulatory reform.
Prospects for Bridging the Divide
There are a few examples that reflect a positive commitment from the national government, other regional governments and even a tech titan to develop Laos’ digital sector. The Lao government, in collaboration with the World Intellectual Property Organization, is investing in a new Technology and Innovation Support Center, scheduled to begin construction this year. This has an ambitious agenda to—among other things—provide a co-working space for tech firms and scientists as well as to promote research and the transfer of technical knowledge from more developed countries. This Center will be networked with 320 similar Centers in 60 other countries.
The South Korean government, meanwhile, is supporting the development of free wifi in Laos. And last year Laos’ government announced a partnership with Microsoft to “advance the adoption of emerging technologies for sustainable development and business development with focus on projects with social impact”.
Outside of government, there are indications of growing local entrepreneurialism and innovation. Three Lao start-ups were accepted for the Mekong Innovative Startup Tourism (MIST) Startup Accelerator Program in April 2017. These promote high-quality traditional crafts, Hmong-inspired textiles and employment opportunities for youth. Of particular interest to us at POPS Dev, Laos even has its own self-described online platform for development, Click Laos. This platform features information on a range of development approaches, from research to knowledge sharing, community learning centers and information clubs.
Laos’ largest online jobs site, 108JOB, reflects (and reinforces) an optimism in the growth of the digital economy. This site has quickly grown to the point where it is, according to one article, receiving over one million monthly views and adding approximately 100 new job announcements every day.
And while these are early days for Laos’ innovation and start up ecosystem, e-commerce is starting to grow and attracting investment from the likes of the Asian Development Bank, reflecting this boom across the Southeast Asia region. The not-insignificant challenge is that there are still no laws in place in Laos to regulate e-commerce.
Key issues for Laos going forward relate to the development of human resources, an ecosystem that promotes innovation, digital infrastructure and the regulatory framework that promotes all of these.
Image credit: Nicolas Raymond
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