Joint Government-Private Sector Committee of Experts Joint Government-Private Sector Committee of Experts on Electronic Commerceon Electronic Commerce

THE DIGITAL DIVIDETHE DIGITAL DIVIDE

PRESENTATION OF THE PRESENTATION OF THE DELEGATION OF COLOMBIADELEGATION OF COLOMBIA

Panama City, Panama, October 2001

PublicFTAA.ecom/inf/112

October 25, 2001

Original: SpanishTranslation: FTAA Secretariat

PRESENTATION PRESENTATION DELEGATION OF COLOMBIADELEGATION OF COLOMBIA

• Colombia viewed in a General Context• Background• Connectivity Agenda• Strategy for the Promotion of the IT Industry• Proposal of Colombia

COLOMBIA

VIEWED

WITHIN A GENERAL CONTEXT

Latin America is the fastest growing IT market and Latin America is the fastest growing IT market and also the least penetrated. It is expected to surpass also the least penetrated. It is expected to surpass North American, European and Asian markets.North American, European and Asian markets.

On average, compound growth rate is 18.2% in this On average, compound growth rate is 18.2% in this market whereas for the rest of the globe, growth market whereas for the rest of the globe, growth rates have remained near 10.9% year after year.rates have remained near 10.9% year after year.

The IT Industry in Latin America

Distribution of the IT Industry in Latin America

Venezuela12%

México11%

Colombia10%

Chile10%Argentina

7%

Brasil38%

Resto de Latinoamérica

12%

Fuente : IDC Colombia

9%13%

9%1%

23%7%

10%

10%

6%8% 4%

Consulting

Outsourcing del Sistema de Información

Processing Services

Outsourcing Applications

Systems Integration

Software Development Applications

Software Support and Maintenance

Hardware Support and Maintenance

Network Integration and Consulting

Desktop and Network Outsourcing

IT Education and Training

Investment in IT Services in Colombia - 2000 (US$ M)

Source: IDC Colombia

Investment in IT Services in Colombia (US $M)

1999 2000 2001 2002 2003 2004

IS Consulting 38 41 44 47 52 59Information Systems Outsourcing 52 58 68 78 85 92Processing Services 35 43 51 61 71 83Outsourcing Applications 2 4 7 11 15 18Systems Integration 97 110 123 136 151 168Software Application Development 22 32 38 44 50 58Software Support and Maintenance 38 46 51 56 63 69Hardware Support and Maintenance 44 48 53 58 64 70Consultancy and Network Integration 16 26 36 45 55 65Outsourcing of Desktop and Networks 27 35 43 53 63 75Education and Training in IT 18 19 22 25 28 31

Total Colombia 389 462 536 614 697 788

: IDC Colombia

Service Operators SubscribersFixed Telephony 52 7 millionCellular 4 2millionLong Distance 3 6 billion minutesISP's 55 750,000Paging 40 210,000Trunking 5 60,000

Telecommunications Infrastructure - Colombia

IT vs. GDP in Colombia

-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

IT Growth

GDP Growth

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

% IT vs. GDP

PC Market Penetration

WorldLat.Am.

0%1%2%3%4%5%6%7%8%9%

10%11%12%13%14%

2000 2001 2002

86% 98%76%

# P

Cs

per

100

in

hab

itan

ts

Internet Index

Source: 2000 IDC/World Iimes

Information Society Index (ISI)

10

20

30

40

50

60

70

80

90

Lat.Am.Av.

World Av.

Internet UseFor Business

Internet Usersin Education

Internet Users in The Home

E-CommerceExpenditure

Internet Penetration

World

Lat.Am.

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

11%

12%

2000 2001 2002

51% 58%44%

# U

sers

per

100

in

hab

itan

ts

7.74 22.3671.15

134.17

269.86

475.34

0

100

200

300

400

500

_1998 _1999 _2000 _2001 _2002 _2003

U$ M

U$ 1000 MU$ 1000 M

Fuente: IDC Colombia, 2001

Electronic Commerce Colombia

BACKGROUND

In 1994, the Colombian government came up with In 1994, the Colombian government came up with the idea of fostering the development of IT with the the idea of fostering the development of IT with the support of international institutions, such as support of international institutions, such as Protrade and GTZ of Germany.Protrade and GTZ of Germany.

In 1995, the government also started to promote the In 1995, the government also started to promote the participation of Colombian enterprises in the Cebit participation of Colombian enterprises in the Cebit Fair, held every year in Hannover, Germany.Fair, held every year in Hannover, Germany.

The IT Industry in Colombia

COINVERTIR, as part of its ongoing efforts, COINVERTIR, as part of its ongoing efforts, designed an electronics and software project and designed an electronics and software project and executed other countries’ studies. A business and executed other countries’ studies. A business and technology mission to India was also carried out.technology mission to India was also carried out.

Activities in this sector have the support of various Activities in this sector have the support of various trade unions that make up the industry; FEDESOFT, trade unions that make up the industry; FEDESOFT, ACIS, ACUC.ACIS, ACUC.

The IT Industry in Colombia

Legislation

• Law 527 of 1999– Functional equivalent principle for concepts regarding

text, signature, and original.– Provisions that confer juridical validity, probative and

mandatory value for all types of information in the form of data messages.

– Digital signature on the same footing as handwritten signature.

– Certification entities.

Legislation

• Decree 1747 of 2000 – Requirements to be met by certification entities that wish

to carry out activities in Colombia– Closed Entities – offer, free of charge, certification

services that are only for the exchange of messages between the entity and the subscriber.

– Open Entities – offer certification services only when use is not limited to messages between the entity and the subscriber or when it is remunerated for these services.

The Ministry of Foreign Trade formulated the Strategic Export Plan 1999-2009, which maps out the course to follow to strengthen Colombia’s productive sector and its orientation toward the international market. The plan is made up of five strategic objectives.

Strategic Objective 1 aims to increase and diversify the exportable supply of goods and services based on world demand.

Strategy 2 of this objective specifically aims to adapt, reorient, and promote the tools for boosting foreign trade.

Development of electronic commerce forms part of the Plan’s second strategy under Objective 1.

Strategic Export Plan

CONNECTIVITY AGENDA

In 199l, in establishing the “Connectivity Agenda,” President In 199l, in establishing the “Connectivity Agenda,” President Andrés Pastrana made the commitment to make the use of ICT Andrés Pastrana made the commitment to make the use of ICT widespread in order to support growth and increase widespread in order to support growth and increase productivity and competitiveness of market access for the productivity and competitiveness of market access for the production sector and reinforce the generation of employment.production sector and reinforce the generation of employment.

Political Framework

Colombia, by the year 2010, expects to be a fully-fledged participant in the information society and be recognized as a:

• Leader in the use of Information Technology in the education, production, and Leader in the use of Information Technology in the education, production, and government sectors, for the purpose of optimizing its own activities and raise government sectors, for the purpose of optimizing its own activities and raise them to the levels and quality in keeping with the standards set by developed them to the levels and quality in keeping with the standards set by developed countries.countries.

• Country where all citizens have access to and actively use Information Country where all citizens have access to and actively use Information Technology for their own development.Technology for their own development.

• Country with world class Information Technology, positioning it as one of the 5 Country with world class Information Technology, positioning it as one of the 5 main exporters of software and related services. main exporters of software and related services.

Vision of the Connectivity Agenda

State Policy aimed at bringing Colombia into the information society by bringing about a widespread increase in the use of Information Technologies and thereby augmenting the competitiveness of the productive sector and modernizing its public and government institutions.

Mission of the Connectivity Agenda

Take advantage of ICT

Close the gap

Business sector participation

New State model

Specific Objectives of the Connectivity Agenda

Access to InfrastructureEducation and TrainingContentOnline enterprisesDeveloping the IT sectorGovernment on-line

Strategies of the Connectivity Agenda

1. Access to Infrastructure1. Access to Infrastructure

2. Education and Training2. Education and Training

3. Content3. Content

4. SMEs4. SMEs

5. Electronic Commerce5. Electronic Commerce

Agenda for Areas of Action – Digital Divide

¤ Telecommunications LawTelecommunications Law¤ PCS - LMDSPCS - LMDS¤ CompartelCompartel¤ Computers for EducationComputers for Education¤ Military Units with InternetMilitary Units with Internet¤ 500 Computer packages500 Computer packages¤ Resolution 307 – 2000 Flat Rates and Reduced RatesResolution 307 – 2000 Flat Rates and Reduced Rates¤ Value-Added Tax Exoneration– PC with 1 ProcessorValue-Added Tax Exoneration– PC with 1 Processor

1. Access to Infrastructure

• 2. Education and Training¤ Intelligent Program¤ Bilingual Classrooms

• 3. Content¤ SINIC – National Cultural Information System¤ SIINTI – Information System of the National IT Infrastructure

Education and Content

• Internet Project and Electronic Commerce

• Incentives for SME Technological Innovation – FomiPymes

• Training of 500 Expopymes (export-oriented SMEs) with the cooperation of the U.S. Department of Trade and Embassy

4. SMEs

•.

4. SMEs – General Criteria for Support

Programs, projects and activities in:Programs, projects and activities in:

¤ Strengthening of technological capacityStrengthening of technological capacity

¤ Information systems, information technology systems and Information systems, information technology systems and economies onlineeconomies online

¤ TrainingTraining

¤ Technical AssistanceTechnical Assistance

¤ Development and promotionDevelopment and promotion

5. Online

Stage IIStage I

I

No

. o

f S

erv

ice

s

Service Levels

Stage III

Dec. 31, 2001Dec. 31, 2000 June 30, 2002

Online Services

Online Procurement

Information Online

State information is a public good

Presidential Directive 02/2000

Result 1 of the First Stage: Presence of National Public Entities on the Internet%

Pre

se

nc

e

100 %

80 %

60 %

40 %

20 %

0 %

203

162

121

81

40

0

Aug. 2000

114

56%

No

. En

tities

Sept. 2000

56%

114

Oct. 2000

56%

114

Nov. 2000

127

63%

Jan. 2001

83%

168

Dec. 2000

151

74%

Feb. 2001

March 2001

176

87%

April 2001

18483%

169

200

99%

May 2001

91%

June 2001

203

100%

Government Online – Stage 2

Stage IIStage I

No

. o

fS

erv

ice

s

Service Levels

Stage III

Dec. 31, 2001

Dec. 31, 2000

June 30, 200220012000 2002

Presidential Directive 02/ 2000

Online Services

Online Procurement

Online Information

Simplify interactionBetween Citizens and the State

Government Online – Stage 2

This is an image. Translation next page.

Surfing

José Royo y Gómez Geological Museum

Foreign Collections

National Fossils

Minerals

DefinitionModalitiesProcedures and RequirementsFormSimulatorStatisticsApproved CreditsRenewalsConsult your account statementRequest

Regional Information

Regional: Antioquia

Credit Information:

Purpose of Credit: Under Graduate

Amortization Term: Short Term

Special Program: Andrés Bello National

Career or Study Program: Maritime Engineering

University: ACAD ARCO

Consultation by Investigative Data

Goals Scope of Data Base

(Illegible) Main Page

Search: Go:

Medical Care

If you would like an appointment…

Pointers Today

Cash

$ 286,000

Enroll: Get online ISS information

Government Online – Stage 3

Stage IIStage I

No

. o

f S

ervi

ces

Niveles deServicio

Stage III

Presidential Directive 02 of 2000 –Third Stage :

•Legal Framework

•Policy regulating agency

•Definition of the Operation and Management Model

Online Services

OnlineProcurement

Online Information

Dec. 31, 2001 Dec. 31, 2000 June 30, 2002

EfficiencyTransparencyProbity

• Compartel 2001Compartel 2001

• Measuring use and advantage taken TI-DANEMeasuring use and advantage taken TI-DANE

• Education PortalEducation Portal

• Strategy for development of IT industry in Strategy for development of IT industry in ColombiaColombia

6. Activities Pending Execution

STRATEGY FOR THE DEVELOPMENT OF IT INDUSTRY

The government of Colombia has been working arduously to identify business opportunities and provide the tools needed for the appropriate development of the following areas:

Creation of adequate legislation Identification of Colombia’s supply Development of human capitalEstablishment of strategic alliancesMarketing of the IT industry in strategic positions

Strategy for the Development of IT Industry

Concrete developments in the sector

Call to the sectorCall to the sector Investment proposals to multinational enterprises Investment proposals to multinational enterprises Videoconference between entrepreneurs of India and ColombiaVideoconference between entrepreneurs of India and ColombiaAndean Program for Technology Exportatiion and Andean Program for Technology Exportatiion and

technological services CAF - Colciencias – Proexporttechnological services CAF - Colciencias – ProexportSilicon Valley - IBASilicon Valley - IBADevelopment of agreements and associations that form part of Development of agreements and associations that form part of

IT industryIT industryBitkomBitkomNasscomNasscom

Colombia IT Industry Objective

Commercialization on the Latin American market of products Commercialization on the Latin American market of products of large enterprisesof large enterprises

Develop new software solutionsDevelop new software solutions

Locate new support centers to meet the region’s needsLocate new support centers to meet the region’s needs

Obtain technology transfers for our industryObtain technology transfers for our industry

Attract and have access to risk capitalAttract and have access to risk capital

PROPOSAL OF COLOMBIA

¤ Measure use of ICT in our countriesMeasure use of ICT in our countries¤ Investment in access to telecommunications infrastructureInvestment in access to telecommunications infrastructure¤ IT Training Centers to meet the needs of the Andean regionIT Training Centers to meet the needs of the Andean region¤ Establishment of a monitoring group on policies defined in Establishment of a monitoring group on policies defined in

developed countries to support the development of IT in developed countries to support the development of IT in developing countriesdeveloping countries

¤ Application of cooperation mechanisms among countries, Application of cooperation mechanisms among countries, to launch projects aimed at decreasing the digital divide to launch projects aimed at decreasing the digital divide throughout the continent.throughout the continent.

Proposals