Internet for Development

Challenges to the Network

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This report, prepared by ITU, is the second in the Challenges to the Network series. The report looks at the role of the Internet in economic development. The study pays special attention to the impact that the Internet is having and will have in the economies of developing nations and the role of the Internet in promoting economic and social development. This version was prepared and updated specially for the TELECOM Interactive 99 event, held in Geneva during October 1999.



Internet for commerce

The economic situation of farmers of a small village near Chincheros in Peru were, until the mid-1990s, not much different from the millions of farmers that live today in rural areas of developing countries. The 50 families living in the village used to receive a small amount of money (US$ 300 a month for the whole village) in exchange for their local produce. As in most rural areas of developing countries, the prospects of change and progress were fairly limited and elusive. In 1996, thanks to the initiative of a local Internet Service Provider (ISP), Non-Governmental Organisations (NGOs) working in Peru, the Ministry of Agriculture, and the village were connected to the Internet. The connection brought not only information from around the world but also opened up a channel for global trade. Grasping the opportunity, the council of village leaders was able to establish an online partnership with an international export company. Soon afterwards Chincheros’ vegetables were shipped directly to the United States to be sold in the New York market. By 1998, the village's income had grown fivefold to US$ 1’500 a month.


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