Is the “New Economy” about IT jobs or jobs that use IT?

An interesting seminar today with Dr. Sanjaasuren Oyun, a progressive parliamentarian from Mongolia, got me thinking again about one of the major questions about ICTs and development — are we trying to jumpstart an ICT industry or are we trying to help out existing industries through the use of ICTs?

I have only dabbled in research into Mongolia, and much of it stems from 5+ years ago, but the short answer about ICTs and Mongolia’s post-Soviet and isolated problems seems to be to continue to nurture the nascent yet thriving ICT industry (software, offshore information processing…) but also look to apply ICTs to Mongolia’s existing strengths. There isn’t much going on in Mongolia except copper mining and cashmere, and mining doesn’t offer much in the way of diversifying and bettering the country’s competitive/comparative advantage. But the cashmere industry suggests something else – since most cashmere is sold to China, Japan, Europe and the US to make into high-end garments sold by fancy fashion houses, why shouldn’t Mongolia reap the rewards of nice sweaters, peacoats and suits instead of raw cashmere wool?

Textiles are one of the most competitive, ICT-intensive industries out there today. Every top-of-the-line garment assembly outfit has state-of-the-art, just-in-time information systems that gives it the latest order from whichever designer needs an order within 72 hours. Mongolia, with its stranglehold on cashmere, one of the highest-end natural resources that makes value-added clothes anywhere in the world, needs to ramp up its textiles industry.

By now it is a no-brainer (in spite of the ridiculous claims to the contrary about how Iraq’s oil will take care of everything and the current state of Venezuela with its oil “riches”) that natural resources alone don’t cut it in today’s globalized, competitive economy. So Mongolia, with all of its land-lockedness, post-Soviet problems and issues of the rural people flocking to Ulan Bator, needs to figure out how to create value-added industries that will give it some leg up. But Mongolia by no means is the only game in town.

There are certainly lots of stories out there. There are countries that are trying to recreate Silicon Valley from scratch. There are countries that are trying to develop an offshore programming industry like Bangalore. There are countries that want to beat out Mauritius, Sri Lanka and the Dominican Republic to win just-in-time textile contracts with European, Japanese and US fashion houses. And many many reasons why everyone wants computers and the Internet.

But what is the answer?

The answer is that every country is different, and that there is no one solution in today’s globalized and competitive economy. Every country needs to examine how ICTs might help existing industries, but also create new ones.

This is a terrible answer, and so insufficient, to one of the most common questions.

But the answer is true. Each country has terrible problems and fantastic assets. ICTs do not represent the cure nor the help for everything. But it is possible for every country to recognize the areas where technology will help.

It is harder to recognize where technology will not help — this is the reason for so many wasted funds and projects. Again and again, it is not just the technology, but everything else that matters.

I hope that Mongolia figures it out – it is by all accounts a beautiful country with wonderful people, fly-fishing, mountain climbing, horseback riding and hospitality galore. High-end tourism would not be a terrible industry to specialize in…and technology doesn’t hurt there either…

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