ROI on ICT Adoption in Developing Countries

As technology becomes increasingly accessible and permeates societies in developing countries, I believe that the question of whether the money spent or invested in ICT is generating an adequate return on investment (ROI) to justify the expenditure is critical.

In many cases*, the technology being used in developing countries originates in some form from developed countries, for example, patent or manufacture. Since these technologies cannot generate economic returns from patent or manufacture in the developing country then, at the very least, it becomes very important for their usage to be economically purposeful. Otherwise, the valuable, and usually scarce, foreign exchange being used to acquire these technologies might be better used in other economic investments.

When an individual purchases a smart phone, are the features being used for amusement or to generate economic activity? When a government makes large investments in technological infrastructure to support e-government, is the civil service ready to absorb and use this technology? When a corporation implements new state-of-the-art business technology, is the market sophisticated enough to make full use of the additional services offered as a result? It may be the case that in many instances society is not mature enough for smart phones, the civil service organisation may be years away from being ready to accept and effectively use e-government technology and the market in a developing country is simply not sophisticated enough for the new services from state-of-the-art business technology. In the simplest case of the smart phone, even partial use of the features for generating positive economic activity may not provide the required ROI per dollar of foreign exchange invested to warrant the investment.

It might be that investments in ICT should be strategically controlled until society is ready to accept increasingly complex technologies, either through education, maturity or practicality. Should governments then play a role in managing the use and adoption of technology in developing countries?

*I note that some larger emerging economies do manufacture some ICT, sometimes under licence, but there are a significant number of developing countries who are importers and consumers.