Countries in the developed world with high levels of e-readiness are finding
it much easier for their companies to operate in the global business environment
than enterprises in developing countries where the level of e-readiness is low. It
is anticipated that with the globalisation of the digital economy, SMEs will find it
prudent to enter the international market because they stand to benefit more from:
reduced transaction costs, gaining competitive advantages, and using management
supply chain networks that facilitate procurement, knowledge and skills sharing, and
technology transfer. Enterprises aspiring to take advantage of the digital economy
through ICT can learn from the developed world where most of the enterprises, by
virtue of the high level of e-readiness of those countries, are already partaking in
the global digital economy.
A number of countries worldwide and some international agencies are undertaking
initiatives to enable companies operating in their jurisdictions and beyond
to transact business online and effectively participate in the digital economy. For
example, in South Korea, the government supports B2B and IT use in SMEs, while
in Hong Kong the government does not tax profits from e-commerce. Elsewhere in
Asia, the Mongolian government is driving its e-commerce programme from the
Prime Minister’s office. Within Europe, the European Union has also shaped its
regulatory environment to cater for e-commerce. Furthermore, the OECD region has
embraced the concept of learning organisations to adapt their organisations to the
changing global digital environment by promoting a culture of continuous learning
and process reengineering. In North America, the US Federal government is working
with the UN Commission on International Trade Law to develop a model law that
supports the common use of international contracts in e-commerce.
As concerted efforts are being undertaken globally to enhance global e-business
environments, there are various challenges and issues that first have to be confronted
and addressed in order to achieve a truly global digital economy. Issues of online
security and privacy, for example, are exacerbated by the fact that the Internet does
not have an effective central coordination and control system or mechanism. With
whom, for instance, does one lodge a complaint if one’s rights are violated online?
Moreover, there is a general lack of awareness about the potential of technology
and in particular, what e-commerce can offer, especially to SMEs. There is a need
to educate business enterprises on the potential of ICT in business transactions.
Governments should be encouraged to work through bilateral and multilateral arrangements
to create cross-jurisdictional legal frameworks that enhance cross border
e-commerce. In addition, the peculiarities of SMEs demand that the problems
they face should be given special treatment if they are to effectively participate in
the digital economy. The success of nations’ participation in the Net economy is
predicated on the level of their SMEs’ e-readiness. Without the full participation of
SMEs, this hyped economy may become the economy that never was.