Information Technology in Third World Countries - Essay Example

?Information Technology in Third World countries Information technology (IT) is a huge industry in itselfand also the source of the dramatic changes in business practices. In general, technical changes and information technology are widely acknowledged as having vital impact on the productivity and growth in particular countries. Besides, they have shown to impact on the global economy patterns. A vast majority of the developing and the Third World countries are actually not fully benefitting from globalization of technology. With the exclusion of the East Asia, many Third World countries have not attained any significant economic growth over the past decade. Moreover, their access to recent and new technology is limited. In many occasions only the elites of particular under-developed countries have access to technological. The rest of the country is confined to living in of abject poverty by living lives without the vital necessities like purified water, proper shelter and clothing (James, 2001:148). Therefore, if the developing nations would exploit the advantages offered by information technology (IT) by being integrated in the global economy, they would also be conversant with the many characteristics together with the resulting impulses they would propagate. This is because IT alters the way global competition is carried out and locational behavior of the multinational corporations. Since competition is a continuous technological revolution, it requires new principles and concepts that are beyond those offered by traditional national comparative advantage. As a result, the information industry has led to technological transformations and growth of the whole economies. In addition, competition is characterized by fast technological changes, intense global competition, and uncertainties. Consequently, these characteristics need that; you know the anticipation of the core capabilities, continuous technological learning, exact timing of entry into the market, and finally developing of the supporting institutions (James: 2001:148-9) According to James (2001:149-150) the pattern of globalization in the Third world countries has shown that it has led to the deterioration of foreign trade. This is because the overall ratio of trade to GDP n the past decade has been on the rise for the developing countries.. The Third World countries that are seeking to enter the global market now have already been left behind. The huge amounts of cash flow and general capital are required to establish a true presence in the global market; as a result many Third World nations have not yet generated the necessary capital and domestic conditions so as to be strong competitors in the current world of neoliberal trade. Moreover, globalization is partly due to the factors that are unrelated changes in technology and IT in particular. As result, the most important of these factors is the liberal approach to both international trade and foreign investment that adopted in many countries, both developed as well as the developing. Developing nations have not been able to fully reap the potential benefits that are available through globalization. As a result this has left them much less subjected to the downsides of globalization like sweatshops and pollution According to Craig, David and Porter (2004:45-7) assert that international trade levels have been depending on costs of transport but also on the communication costs between the sellers and the buyers in the different countries In fact, the two distinct mechanisms through which globalization is being driven by a reduction in costs of communication. The more obvious mechanism is that because of the technologies like the digital switching, fax machines and Internet. Therefore, information about the already traded goods can be passed on between the countries more cheaply than it was hitherto possible. This manifests among other ways, the growth of electronic commerce between various businesses, digital goods delivery and the retail sale of tangible goods. The second mechanism is concerned with the ability of information technology to bring particular services that were formerly non-tradable into the realm of tradability. Globalization can be promoted by various policies. Firstly, trade is promoted by the reduction in costs of communication and information imperfections. This is attained by the communication technologies like mobile phones and e-mail and infrastructure in telecommunications. Also the adoption of IT enhances the comparative advantage of those firms and nations that are adopting on the peril of the non-adopters through industrial technologies like CAD and numerically controlled machines (NCMTs). The rapid growth of exports in electronics raised the ratio of trade to global output. Lastly, IT promotes the strategic alliances by the multinational corporations (James: 2001:153-154). To the developing countries, the developed nations which have prospered over the course of the last two decades are serve as their role models in terms of setting future goals for the GDP outputs, successful trade interactions, and technological achievements. However, the problem is that in the past two decades, regions like Latin America and Africa have actually made little progress with respect to technological achievements and achievements. This has led to some experts believing the reasons for the stalling progress in these regions can be attributed to the fact that important parts of society have resisted change (James; 2001:157-8). Conclusion Globalization in itself has long been a rising phenomenon, rising over the decades and centuries without any signs of slowing. With rapid changes happening in the world as a result of the rapid globalization, numerous questions and debates have arisen. There is concerned about the unequal distribution of resources and wealth and resources, and the fear of the gap between poverty and luxury are only exacerbated by the effects of globalization. However, other experts argue that globalization allows for dissemination of fresh and new ideas and technology around the world, including to the impoverished peoples who are desperately in need of it especially in the Third World countries. The Third World nations should embrace the usage of IT to build and sustain competitive advantage with regard to the industrial age advantage include marketing, mass production to suit every customer, there optimization of the physical value chains, an excellent customer service as they are dealt with one on one, the location is physical thus easily accessed, prompt delivery of the physical products to the door. the IT advantages include; Mass customization, there in one-to-one marketing thus customer satisfaction, there a provision of the customer participating, self service of the customers, virtual globalization as a larger number of people are met, collaboration of the information with the suppliers thus getting the services at lower costs, and finally online delivery of the virtual goods. To sum up, nations that have explicitly sought to exploit the full range of integrative possibilities afforded by information technology and have also benefited from a number of powerful cumulative mechanisms that further enhanced the extent of their integration through foreign investment and international investment. On the other hand, countries that have made little effort to exploit information technology as globalization tool for globalization indeed have suffered from the accompanying ‘backwash’ effects of the expansion of foreign investment and trade in the former group of countries. Reference List Craig, David., & Doug Porter. (2004). “The Third Way and the Third World: Poverty Reduction and Social Inclusion”. Review of International Political Economy, 11(2), 2-25. James, J. (2001). Information technology, cumulative causation and patterns of globalization in the Third World. Review of International Political Economy , 8 (1), 147-162. Read More