ICT contribution to Ghana's GDP is difficult to estimate - Study

Accra, June 20, GNA - Contribution of ICT (Information Communication Technology) sector to Ghana's real GDP (Gross Domestic Product) is difficult to determine despite some efforts to estimate that, a recent study has shown.

Preliminary findings of a study carried out recently under the LICOM project in Ghana and copied to Ghana News Agency, has shown that the ICT sector is making significant direct and indirect contributions to almost all sectors of the economy but its actual contribution to GDP is unknown. The study was carried by the Science and Technology Policy Research Institute (STEPRI), a subsidiary of the Council for Scientific and Industrial Research (CSIR) in Ghana.

It was part of the LICOM Project, a sub-regional study involving countries such as Ghana, Benin, Senegal and Nigeria with the aim of contributing to a better understanding of the international challenges of liberalization of Trade in ICT services in order to encourage the formulation of policies conducive to the development of ICT and private sector in West Africa.

The preliminary findings were presented at a stakeholder forum in Accra by Dr Daniel K. Twerefou, a senior lecturer at the Economics Department of the University of Ghana, who said: "It is very difficult obtaining information on the contribution of Information Communication Technology (ICT) to national output because the sector was lumped with other sectors. In 2000, the World Bank's statistics, however, indicated that the sector's contribution for Ghana was 1.8 per cent of GDP. Meanwhile, Dr Twerefuo added that a current report on innovation and ICT in Ghana had also estimated overall contribution of ICT industry to GDP in Ghana at about USD 750 million a year (about 1 per cent of GDP). The study was to assess the overall direct and indirect impacts of liberalization on the Ghanaian economy. ICT as an enabler, he said, is used by other sectors to ensure efficiency and competitiveness in trade, education, agriculture, health, financial services and aviation among others. Inefficient functioning of the ICT sector, he said, would have multiplicative effects on all other sectors by posing a barrier to development

Dr Twerefou said ICT as a business, provided services directly used by consumers-communication services, sale of equipment and ancillary services. Dr Twerefou stated that direct and indirect employment by telecommunication sector continued to increase and the country's IT-enabled service industry provided direct employment for about 2500 people. Dwelling more on ICT impact to development, Dr Twerefuo said, "The financial sector in Ghana was revolutionalized by the ICT." He said under the period banks had networked to provide efficient service to its customers.

He said the i ntroduction of mobile and internet banking helped customers to check their statements, order cheque books and pay their bills using the mobile phones. Other services that revolutionalised the banking sector according to Dr Twerefuo included money transfer such as Money Gram, Vigo and Western Union Money Transfer, use of debit cards, credit cards and other smart cards which made Ghana part of the global financial system. "Efficient Cheque clearance systems sped up transaction. "More could have been done, if government policies have been properly implemented to address the constraints that hindered the development of local content," he noted. He called on government to make more efforts to expand consultation and educate ICT stakeholders on regional and international agreements on trade in ICT goods and services.

Dr Twerefuo said local companies must be encouraged to form partnerships or expand, used available credit facilities in order to increase their market shares and reduced donor influence in the formulation of policies. He also prescribed that Trade Advisory Board should provides some protection for local companies through tax reduction and subsidies to encourage development. He called for an effective ICT policy that monitored industries and established Competition Authority to allow it to consider competition in the sector and reduce unfair treatment against local companies. He also prescribed ICT regime that facilitated the provision of credit for small companies, reduced the influx of inferior quality product on the market, introduced policies and incentives to encourage MNC to retain part of their profits. Given an overview of the LICOM Project, Dr Godfred Frempong, a Director at STEPRI, said the project activities include surveys on the key legal instruments regulating trade in ICT goods and services liberalization, study on the characterization of ICT goods and services in West Africa and research to access the costs and benefits of the General Agreements on Trade in Services (GATS) under the World Trade Organisation for ICT services. He said the recommendations of the studies were intended to assist public decision makers and the private sector to take advantage of the opportunities of liberalization of trade on ICT services. 20 June 10