Information and Communication Technology (ICT) for development of small and medium-sized exporters in Latin America: Chile
Chile has a reputation as a country with an open economy and sound macroeconomic fundamentals. Over the years, its well-coordinated economic policy has attracted foreign direct investment (FDI), which has encouraged the development of export sectors and facilitated the dissemination of information technologies (ITs) nationwide. Today, Chile's per-capita distribution rates for IT products and services are the highest in Latin America. Nonetheless wide gaps remain between large firms and small and medium-sized enterprises (SMEs) in terms of IT exports and usage. From an international standpoint, IT penetration among Chilean society and businesses is not high compared to developed countries; and it is unclear whether Chile has significant advantages in IT usage compared to developing countries in Asia where some firms are integrated in international supply chains based on IT management systems. Chile's IT sector is also less developed than several ASEAN States and Latin American countries such as Brazil. There are three key policy issues for Chile that arise from innovations in IT, globalization, and Chile's trade policy that seeks to benefit from free trade agreements (FTAs) (El Mercurio 2005a). The first is to seize new opportunities for traditional businesses that will benefit from using effectively IT methods, such as e-commerce. The second is to improve the competitiveness of export goods and services in order to survive intensifying international competition. Key issues for firms will be to increase value-added in the existing range of products and services, to develop new ones, and to reduce costs. This will be reached by ITs that will achieve higher quality and more effective business management, effective R&D activities and others that should improve overall business activities. The third is development of the IT sector itself. These issues bear more heavily on SMEs than on larger firms, and ITs should also open up broader fields of business activities for SMEs. The public and academic sectors should also be required to make efforts to improve the competitiveness of Chilean firms, especially through technology transfers from universities to the corporate sector. This report explores intra- and inter-regional cooperation in Asia and Latin America to promote international trade by SMEs, based on Chilean experiences of government policies to promote IT usage by developing small and medium-sized exporters, and of international cooperation in the IT field.