Intergovernmental Group of Experts on E-commerce and the Digital Dconomy – second session – part 3

Event report

[Read more session reports from the UNCTAD E-Commerce Week 2018]

Mr James Howe (Senior Adviser, International Marketing and Branding, International Trade Centre (ITC)) opened the session, focusing the panel on strategies to overcome operational hurdles for e-commerce in developing nations. He continued by detailing the ITC’s recent efforts to build e-commerce infrastructure in sub-Saharan Africa.

Howe turned the floor over to Ms Kati Suominen (Founder and Chief Executive Officer (CEO), Nextrade Group, and Chairwoman, TradeUp Capital Fund) who spoke about using e-commerce as a means of economic mobility in developing nations. She mentioned that the establishment of platforms is growing at a rate of 70-90% year-on-year in developing nations, but usage of these platforms lags far behind. To induce small and medium enterprises (SMEs) to take more advantage of platforms, Suominen called for policy in the digital privacy, payment processing, physical infrastructure, logistics/facilitation, finance, and export protection spaces to encourage more adoption. She also cited the fact that European examples show a direct correlation between platform policy rollout and platform usage.

Dr Monica Kerretts-Makau (Senior Faculty, Strathmore Business School), spoke next, reminding the panel first and foremost that Africa is not one country. She noted a few e-commerce implementations that have flourished in Kenya, such as BidorBuy.com and Konga.com, before identifying deficiencies that restrain e-commerce on the continent. Kerretts-Makau noted that the credit system is poorly developed in Kenya, making cash the primary mode of purchase, and that there is widespread inexperience with taxation for e-marketplaces. She noted that any time an e-commerce purchase occurs, the customer has to phone the fulfilment company with specific directions in order to receive the package. Public education, such as the tax information delivered via kenyaeregulations.org, helps the situation, but e-commerce will not fully accelerate until the stakeholder scope expands, Kerretts-Makau added.

Moderators invited delegates from the world’s developing nations to share their own successes in encouraging domestic e-commerce. Salient points came from a delegate from Sierra Leone, who comment on how women’s economic empowerment relates to e-commerce proliferation. Furthermore, a representative from Trinidad and Tobago asked how it is possible to encourage e-commerce with low electrification rates and poor road infrastructure, a point that resonated with much of the audience. To that end, a representative from Zambia suggested creating communal e-commerce centres, with a reliable address and broadband access, to improve e-commerce accessibility in rural areas.

Finally, a delegate from Togo stated that blockchain’s distributed ledgers make it an ideal fit for low-trust e-commerce situations in Africa. Smart contracts, according to the delegate, will induce competency from e-commerce fulfilment and delivery. Kerretts-Makau entered the conversation again, emphasising the importance of training youth to use computers and partake in e-commerce transactions.

The session concluded as participants underlined the need to legally ‘leapfrog’ in the developing world in order to keep pace with e-commerce development in the developed world.

By Frank Kosarek