Pictured from left: Juan Camilo Saretzki-Forero, First Secretary of the Permanent Mission of Colombia to the UN, Scarlett Fondeur Gil, UNCTAD and Vlasta Macku, Virtual InstituteAbout 100 students and lecturers from two Colombian Virtual Institute member universities joined 2012 Information Economy Report (IER) co-author, Scarlett Fondeur Gil, March 12 for a videoconference discussion on the software industry and developing countries. Juan Camilo Saretzki-Forero, First Secretary of the Permanent Mission of Colombia to the UN, was at hand to introduce the exchange, and provide valuable information on the country’s efforts to strengthen its position in the software development and information technology services market.

"The spread of ICTs (information and communication technologies) continues to facilitate technological change in the globalizing economy," Fondeur Gil told the participants, most of them specializing in international business at Universidad de la Sabana and Universidad EAN.

Low capital entry requirements, its high-value, high-growth nature and potential for employment generation (in particular for young qualified workers) make the software sector an attractive choice for developing countries.

"Thanks to the increasing demand for software from social networks, online work and cloud computing, as well as the growing use of free and open source software, there is today more scope even for small-scale developers in developing countries to participate in software development and production," she affirmed.

According to the IER, developed countries account for the vast share of expenditure in the software industry. The remaining share belongs mainly to East, South and South-East Asia, while spending in the developing regions of Africa, Latin America and the Middle East corresponds to only 4 percent.

"This suggests significant potential for increasing the use of computer software and IT services in develop¬ing countries," Fondeur Gil said, stressing the role of local software development in supplying locally relevant solutions and services.

"'Local' is the key word," she said. "By developing local and regional markets, developing countries will be able to integrate into the global software market."

In terms of the Latin America and the Caribbean region, a look at indicators such as computer software and services spending and domestic versus export sales, produce noteworthy regional contrasts, she reported. Costa Rica and Uruguay have focused on exports, whereas in Brazil the large local market is more significant.

But "(t)he successful development of software capabilities cannot be accomplished solely by market forces,” she warned. “Governments have a key role to play.”

An increasing number of countries have been elaborating specific strategies to promote their software sectors. Such strategies need to be adapted to each country case and involve the private sector, academia and software developers.

"While funds for software development ventures come from the private sector, the governments are responsible for determining conditions for investment," Fondeur Gil said.

Other areas for policy intervention include accessible IT infrastructure, ensuring a qualified work force, and strengthening the legal framework related to intellectual property and electronic transactions. The government should also lead the way by using locally produced software in government procurement, for example.

During the ensuing discussion, participants asked questions related to the links between cultural factors and technological innovation, competitiveness of the Colombian and Chilean software industries, information economy statistics, and ways of fostering the development of micro-entrepreneurs in the software development area.

For more about the topic, read the Information Economy Report 2012.