INTEGRA Managing Associate Eric White yesterday gave a presentation to a gathering of USAID infrastructure specialists from missions around the world about the importance of investing in ICT infrastructure. He specifically highlighted the importance of wireless voice and broadband connectivity in meeting the US Government’s goals under the new “Feed the Future” program.
Food Security, Mr. White explained, can come either through improving domestic agricultural output and distribution or through improved cross-border trade facilitation. He highlighted ways that ICT infrastructure improves both. After pointing out that agricultural development is the flip side of rural economic growth Mr. White explained how numerous studies, at both the macro and micro level, have found a 10-1 relationship between expanding ICT coverage and GDP growth. A 10% increase in ICT penetration is generally associated with a 1% increase in GDP growth rates.
Mr. White then explained how it is possible to work with private sector firms to expand ICT access to rural people in developing countries. He pointed out the remarkable willingness-to-pay of even the very poor when it comes to communication. Even people living on only a few dollars a day are willing to pay up to 10% of their income for access to communication. Given that relatively large willingness-to-pay and a relatively low cost of capital it is in fact possible to reach every developing country resident with wireless technology through the smart use of targeted subsidies and investment in emerging low-cost technologies.