Most Arab nations have made significant progress towards becoming knowledge-based economies by making major improvements in ICT diffusion since the mid-1990s However, the difference in ICT use across the region is so wide that it almost creates a digital divide with the Gulf Cooperation Council (GCC) countries on one side and the rest of the MENA countries standing on the other side of the divide. Therefore, despite making significant progress towards becoming a knowledge-based economy, a lot needs to be done for expanding broadband capacity and spreading ICT usage in non-GCC Arab nations to create a true Arab Knowledge Economy.

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The Arab Digital Divide and the March
towards a True Arab Knowledge Economy
 Most Arab nations have made significant progress towards becoming knowledge-based
economies by making major improvements in ICT diffusion since the mid-1990s
 However, the difference in ICT use across the region is so wide that it almost creates a
digital divide with the Gulf Cooperation Council (GCC) countries on one side and the
rest of the MENA countries standing on the other side of the divide.
 Therefore, despite making significant progress towards becoming a knowledge-based
economy, a lot needs to be done for expanding broadband capacity and spreading ICT
usage in non-GCC Arab nations to create a true Arab Knowledge Economy.
In today’s fast progressing information era, numerous countries are focusing on
knowledge creation and advanced technological development—together termed
as ‘Knowledge Economy’. In order to remain competitive in the global economy
of the 21st century, most Arab nations are also utilizing the power of high-quality
knowledge. They are laying out relevant policies and taking important steps to
meet all requirements that define a knowledge economy and these efforts have

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yielded positive results as well. Since 2001, the Arab World has recorded the
largest growth in Internet users across the regions in the world. There has
been more than a 600% increase in the number of citizens accessing the
Internet in the region. Some Arab countries have also launched initiatives for
improving their education system and Information and Communications
Technology (ICT) infrastructure.
A dynamic ICT infrastructure is a pre-requisite for a nation to fully participate
in the global knowledge economy and to accelerate economic growth – it is
measured by the extent of mobile telephony, computers, Internet access, and
new electronic applications, all supported by a dynamic IT industry that
boosts employment and economic growth. There is enough evidence that
information and communication technology (ICT) plays an increasingly
significant role in economic growth. According to a World Bank’s report, every
10 percentage-point increase in broadband penetration in low- and middle-income
countries accelerates their economic growth by 1.38 percentage points.
Majority of the Arab countries have made significant progress towards becoming
knowledge-based economies by making major improvements in ICT diffusion
since the mid-1990s — the mobile cellular segment has grown from almost
nothing in 2000 to 87 subscriptions per 100 people in 2010; during the same
period, the number of Internet users in the MENA region increased tenfold to
more than 100 million, with wide variation across nations, ranging from 12
users per 100 people in Algeria to 81 per 100 in Qatar. According to a report
by Madar Research and Development and Orient Planet, the number of Arab
internet users is expected to increase to nearly 197 million users by 2017, with
the internet penetration rate jumping from about 32% in 2012 to over 51% in
2017 — this would be nearly 3% above the world average at that time.

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However, the difference in ICT use across the region is so wide that it almost
creates a digital divide with the Gulf Cooperation Council (GCC) countries on
one side and the rest of the MENA countries standing on the other side of the
divide. The figure below shows the disparity between GCC and non-GCC
countries. Libya is the only exception among non-GCC nations, with mobile
broadband penetration of nearly 43 per 100 people, a rate comparable with
GCC nations. Growth in Libya is driven by strong government support, which
compensates for the low fixed broadband penetration, and Libya having a GNI
per capita of $16,400.
Fixed and Mobile Broadband Internet Subscription Rate in Select Arab
Countries
Source: International Telecommunications Union, ICT Adoption and Prospects in the
Arab Region 2012
Overall, despite the progress made, a lot needs to be done for expanding
broadband capacity and spreading ICT usage in the region. Just looking at the

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basic technology statistics, one can easily make out the inadequacy of the
region’s ICT infrastructure. For instance, the average bandwidth in the Arab
region is low at around 1 Mb/1,000 people, compared with 40 Mbs/1,000
people in the U.K. and 30 Mbs/1,000 people in France.
High costs of ICT services, driven by monopolies in certain segments, act as
inhibitors in the Arab world. In 2008, Egypt, Lebanon, Syria, and Tunisia still
had monopolies over international long-distance communication; Lebanon
continued to have a monopoly on mobile services. Also, if we glance through
World Bank’s report, only four Arab countries (UAE, Bahrain, Oman and Saudi
Arabia) rank in the top 50 on the Knowledge Economy Index, as there is a lack
of a coherent strategy among the Arab nations to support growth based on
knowledge and innovation. The region continues to face many challenges in
pursuit of transforming into an information-based economy, which requires
implementation of key cross-sector reforms in education, innovation, ICT
infrastructure, etc.
Thus, there is much more that can be done for ensuring that ICTs are used as the
tool for increasing productivity, growth and employment, and that digital growth
in the Arab world is inclusive. As this is done, MENA governments should
introduce and implement policies for improving the ICT skills of their
workforce, which will make them more employable, more innovative and an
effective contributor to the development of a strong and inclusive Arab
Knowledge Economy.
The article was originally published at: Arab Business Review
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