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Least developed countries
A decade of growth, but challenges remain
 
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Photo credit: UN Photo/Evan Schneider
Opening ceremony of the Fourth United Nations Conference on the Least Developed Countries, Istanbul, Turkey

ITU contributed two major reports* to the Fourth United Nations Conference on the Least Developed Countries (UNLDC-IV), held in Istanbul, Turkey, on 9–13 May 2011. One of these reports, “ICT and Telecommunications in Least Developed Countries: Review of progress made during the decade 2000–2010”, presents projects and actions that ITU has undertaken to help least developed countries (LDCs) join the knowledge economy through the deployment and use of information and communication technologies (ICT).

The other report, “The Role of ICT in Advancing Growth in Least Developed Countries: Trends, Challenges and Opportunities”, on which this article is largely based, examines some of the emerging trends and current challenges faced by LDCs on their road to poverty alleviation. It considers changes in the political, economic and social environment of LDCs, their concerns regarding access to financial resources, the infrastructural obstacles they face — in particular those in the telecommunication sector — and the additional risks that arise as a result of climate change and natural disasters. Climate change is a critical factor, given that eleven of the LDCs are also small island developing States. These islands are particularly vulnerable to natural disasters, and have a limited capacity to respond and recover.

UNLDC-IV coincided with a critical point in the achievement of the Millennium Development Goals, with only five more years to meet the targets set for 2015. The ITU reports highlight the important catalytic role that ITU plays in increasing connectivity in LDCs, and provide case study evidence showing how some of these countries have indeed managed to use connectivity successfully to enhance socio-economic development.

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Photo credit: ITU/V. Martin Photo credit: ITU/V. Martin
Zacarias Albano Da Costa, Minister of Foreign Affairs of Timor-Leste with Houlin Zhao, ITU Deputy Secretary-General during a High-Level Meeting on Investment and Partnership at the Fourth United Nations Conference on the Least Developed Countries, Istanbul, Turkey Suvi Lindén, Finland’s Minister of Communications with Brahima Sanou, Director of the ITU Telecommunication Development Bureau during an ITU Special event “Exploring Business models and public-private partnerships”, following the Fourth United Nations Conference on the Least Developed Countries, Istanbul, Turkey

Special support for vulnerable countries

As a way of providing special support to its most vulnerable members, the United Nations General Assembly in 1971 created the category of “Least Developed Country” to cover low-income economies that face severe structural impediments to growth. Since then, 50 countries have been categorized as LDCs, but only three have ever graduated to developing country status: Botswana in 1994, Cape Verde in 2007 and Maldives in 2011 (see article on Maldives). As part of socio-economic progress, joining the knowledge economy is a key factor in moving up the development ladder.

To foster growth and sustainable development, LDCs get special support in the areas of trade and official development assistance — including development financing and technical cooperation. But the process of graduation from LDC status has proved challenging.

Of the 48 LDCs today (see map), 33 are in Africa, 13 in Asia and the Pacific, one in the Americas (Haiti) and one in the Arab States region (Yemen). About 12 per cent of the world’s population (855 million people) live in LDCs.

ITU’s passionate commitment to the world’s least developed countries dates back to 1971 when this category was established. And since the Third United Nations Conference on the Least Developed Countries in 2001, ITU World Telecommunication Development Conferences and ITU Plenipotentiary Conferences have adopted specific resolutions in favour of LDCs, landlocked developing countries and small island developing States.

Through its Special Programme for Least Developed Countries, the ITU Telecommunication Development Bureau (BDT) has undertaken diverse activities and provided concentrated assistance to LDCs to help them develop infrastructure, improve rural telecommunications, introduce new technologies and services, and build human capacity.

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Criteria for LDC status

The criteria for categorizing a country as an LDC have been refined over time. Every three years, the Committee for Development Policy (CDP), a subsidiary body of the United Nations Economic and Social Council (ECOSOC), reviews the socio-economic conditions of all low-income economies to determine whether a country should be added to — or recommended for graduation from — the LDC category. During its most recent review (in 2009), CDP used the following three criteria to identify LDCs and to determine eligibility for graduation:

  • Low income: a three-year average estimate of gross national income per capita (less than USD 905 for inclusion, more than USD 1086 for graduation).

  • Human capital: a composite Human Assets Index based on such indicators as: nutrition (percentage of population undernourished); health (mortality rate for children aged five years or less); education (gross secondary school enrolment ratio); and adult literacy rate.

  • Economic vulnerability: a composite Economic Vulnerability Index based on such indicators as: population size; remoteness; merchandise export concentration; share of agriculture, forestry and fisheries in gross domestic product; homelessness owing to natural disasters; instability of agricultural production; and instability of exports of goods and services.

Based on these criteria, CDP recommended adding Equatorial Guinea to the list of countries eligible for graduation. ECOSOC endorsed that recommendation in July 2009, but the General Assembly did not confirm it. Samoa was also to be added to that list. But taking account of the economic and financial crisis in 2008 and the Pacific Ocean tsunami that devastated that country in September 2009, the General Assembly deferred Samoa’s graduation from LDC status for an additional three years, to 1 January 2014. Meanwhile, following a similar, postponement because of the Indian Ocean tsunami of 2004, the Maldives graduated in January 2011.

By design, the thresholds for graduation are set higher than those for inclusion. This is to ensure that only countries that are able to maintain improved economic performance are considered for graduation.

Countries can decline the opportunity of being added to the LDC list, but their approval is not sought with regard to graduating from LDC status. Only Ghana, Papua New Guinea and Zimbabwe have ever refused to accept the CDP’s recommendation for inclusion in the LDC list, asserting that the analysis of their particular socio-economic conditions did not reflect reality.

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Source: ITU, based on data from UN-OHRLLS (United Nations Office of the High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States) (www.unohrlls.org/en/ldc/related/62/). The map is from the United Nations Cartographic Section (Map No. 4170, Rev.10, May 2010).

The next triennial review of the LDC list will take place in 2012. In preparation for this, CDP took another look at the criteria and indicators for identifying LDCs at a meeting in March 2011. While confirming the reliability of the current criteria, CDP has proposed refinements to the indicators, in particular to better reflect the structural vulnerability of countries to climate change.

Moving out of the vulnerable category

Unsurprisingly, countries recommended for graduation are often reluctant to be removed from the list of LDCs, because of the potential economic effects of the end of preferential treatment. To facilitate the graduation process, CDP gives States a three-year grace period (from the time they are first recommended for graduation) to coordinate with their development and trade partners regarding the phasing out of preferential treatment and special support.

Key findings on the ICT front

Fixed and mobile telephony

There are signs of an upturn in the growth of ICT in LDCs over the period 2000–2010. Mobile communications have emerged as a key technology to bridge the digital divide, and as a means to open up access to governmental, health and environmental information.

In least developed countries, the mobile penetration rate was an estimated 29 per cent, at the end of 2010, according to ITU estimates, suggesting that mobile telephony has been able to at least partially tackle the infrastructure barrier and bring communication networks to the previously unconnected (see Figure 1). In stark contrast, LDCs have an extremely low penetration rate for fixed telephone (slightly more than one per cent at the end of 2010).

In many developed countries, mobile networks provide an additional communication network, sometimes replacing the fixed-line network. In LDCs, mobile networks are often the main network, and this is particularly true in rural areas. For example, in Bangladesh, Burkina Faso, the Democratic Republic of the Congo, Djibouti, Eritrea and Lao People’s Democratic Republic more than 90 per cent of all fixed-telephone lines are in urban areas, whereas most rural areas have no fixed-line infrastructure.

By the end of 2010, just 62 per cent of the population living in LDCs were covered by a mobile cellular signal. This coverage is relatively low compared to the world average of 90 per cent, suggesting that governments in LDCs need to ensure that mobile operators extend their networks to reach more people.

While there are other factors, the introduction of competition has played an important role in making the mobile market the most dynamic ICT market over the past decade. Competition is an important factor in reducing prices and increasing service availability, leading to higher penetration rates. A number of the countries with penetration rates below 10 per cent, including Ethiopia, Eritrea and Myanmar, have not yet introduced competition.

Another reason that mobile telephony has been so successful and spread so rapidly is the growing number of applications, which has increased demand and usage. Non-voice mobile phone applications are proliferating, including in LDCs.

   Figure 1 — Mobile cellular subscriptions per 100 inhabitants, 2000–2010
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*Data for 2010 are estimates.
Source: ITU World Telecommunication/ICT Indicators database.

Internet

A comparison of Internet use in LDCs with that in developing countries as a whole, and with developed countries, shows that there are very large gaps between these groups. By the end of 2010, only about 3 out of 100 people in LDCs were online, while 21 out of 100 people in developing countries as a whole were online. In the developed world, Internet penetration had reached almost 72 per cent (see Figure 2). These data highlight the significant digital divide that separates the developed from the developing countries (and in particular LDCs), suggesting that much more must be done to bring people in developing regions online.

Internet penetration levels in LDCs range from less than 0.5 per cent in Timor-Leste, Myanmar, Bangladesh and Sierra Leone, to more than 15 per cent in Sao Tome and Principe.

Although there are various barriers to higher Internet and broadband penetration levels in LDCs — including the lack of infrastructure, limited international Internet bandwidth, and relatively low educational levels and literacy rates — high prices remain a major challenge. Fixed broadband Internet prices (which are tracked by ITU’s ICT Price Basket) remain prohibitively high in most LDCs.

Because the availability of fixed broadband infrastructure is very limited in many rural areas of LDCs, mobile broadband technologies have a great potential to bring people online, at high speed. The number of mobile broadband subscriptions is growing fast across the world, and has actually overtaken the number of fixed broadband subscriptions, but remains limited in LDCs, with only 0.5 per 100 inhabitants. In the developed world, mobile broadband subscriptions reached more than 50 per cent penetration by the end of 2010.

One reason for the low mobile broadband uptake in LDCs is that by mid-2010 only 13 of these countries were offering 3G services commercially. Since then, several LDCs, including Senegal and Burkina Faso, have either launched services or have announced plans to allocate 3G licences in the near future. The introduction of mobile broadband services is not only expected to address infrastructure challenges, but also to bring down fixed broadband prices, as it will introduce inter-modal competition into the broadband market.

   Figure 2 — Internet users per 100 inhabitants, 2000–2010
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*Data for 2010 are estimates.
Source: ITU World Telecommunication/ICT Indicators database.

ITU’s commitments in the Istanbul Programme of Action for LDCs for 2011–2020

In order to help countries better exploit ICT to drive development, ITU made five key commitments to the Fourth United Nations Conference on the Least Developed Countries. These commitments have been incorporated into the Istanbul Programme of Action for LDCs 2011–2020. In brief, they cover:

  • actions to increase the average phone density in LDCs to 25 lines per 100 inhabitants and the number of Internet connections to 15 per 100 inhabitants by 2020;

  • a comprehensive capacity building and digital inclusion programme;

  • strategies to help LDCs maximize the selection and use of appropriate new technologies, such as broadband, digital broadcasting and next-generation networks;

  • assistance in dealing with cybersecurity issues, and strategies to build trust and confidence in ICT networks;

  • assistance in creating and maintaining a propitious environment for LDC development through an enabling policy and regulatory environment.

“The challenge of creating digital opportunities in least developed countries — including small island developing States and countries with special needs — remains. Achieving this goal will require reinforced efforts on the part of ITU to coordinate with all Member States, the private sector and development partners, so that, working in consonance to pool resources and muster partnerships, we can support LDCs in making the best use of the technological promise of ICT to promote economic growth,” said Brahima Sanou, Director of the ITU Telecommunication Development Bureau.


* Both reports were prepared by the Programme for Least Developed Countries, Countries in Special Need, Emergency Telecommunications and Climate Change Adaptation Division within the ITU Telecommunication Development Bureau. The team was led by Cosmas Zavazava.

 

 

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