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Internet redux

Long before the collapse of the so-called “dot-com” boom in early 2001, many observers were skeptical about the Internet’s potential as a tool for development in Latin America. Even if the World Wide Web could live up to its vaunted potential, they argued, it would only benefit the elite segment of society that can afford computers and Internet connections. Worse yet, this “digital divide” might actually accelerate the division between rich and poor.

But according to Peruvian Prime Minister Roberto Dañino and former general counsel at the IDB affiliate, the Inter-American Investment Corporation, the reverse has turned out to be true. Speaking at a recent conference at IDB headquarters in Washington, D.C., Dañino said that the poor in Peru are harnessing information technology and the Internet to improve their lives in ways that otherwise would not have been possible.

“Peru has approximately 2 million Internet users, but of these, 1.5 million use public booths,” Dañino said at the conference. He was referring to ubiquitous Internet service centers where people can log on by the hour for a modest fee. “Of these public booths, half are in the provinces. Of those in Lima, most are in the outlying areas, the poorest neighborhoods in the city.”

Dañino argued the extraordinary popularity of the Internet in low-income areas indicates that people consider it a valuable and cost-effective resource. Given that reality, he believes governments have a duty to harness the Internet as a tool for improving public services and political participation. In Peru, the government is investing in information technology and developing Internet-based services with the goal of increasing the efficiency and transparency in public administration. That, in turn, should encourage participation and strengthen democracy.

Public procurement is one of the areas where Peru is working to simplify procedures and use the Internet. The goal is to make it easier for microenterprises and small business to bid on government contracts for goods and services, according to Dañino. “Now procedures are so complicated a small business could not even sell a pencil to the government,” he said. Given that public procurement in Peru totals $5 billion per year and is the largest single source of contracting, it is critical for small businesses to compete effectively with larger companies in this sector. Dañino’s speech at the IDB was delivered as part of a two-day conference on electronic procurement (see link at right).

Dañino said information technology can also be used to simplify administrative procedures such as obtaining a birth, health or marriage certificate, or filing a police report. Today, too many low-income Peruvians must often lose two or three days of work waiting in lines to get “these blessed certificates,” Dañino explained.

“There is no reason in the world why we can’t put a whole series of administrative steps online,” Dañino said. These could include passports, military service records, identity cards and driver’s licenses, and, eventually, more interactive applications such as job applications, housing loans and tax returns. “We want the state to be at the service of the citizens,” he said.

Before all this can happen, however, government branches will have to do a better job of communicating with one another, according to Dañino. Peru is also hoping to use the Internet for this purpose, by building a so-called “Infranet” that can link scattered government services and streamline paperwork. If executed properly, this initiative “can generate important savings” for government, Dañino said.

The first phase of Peru’s program to leverage the Internet will consist of putting 10 of the most common administrative procedures—like getting a birth certificate—online, Dañino said. The second and third phases will put gradually more complicated procedures online. “We want to do this within 18 months,” he said. The government Infranet, which will make internal communication and procedures more efficient, is scheduled to be up and running by December 2002.

The information technology plan is part of a broader program to modernize infrastructure, education, communications, national industry and electronics, according to Dañino. Though this process will take much longer than 18 months, he is confident that the Internet will bring short-term benefits to millions of Peruvians, and particularly to those with limited means. “It is precisely those who have the least who can make a big leap forward and skip certain stages that other countries had to experience to arrive at a certain point,” Dañino said.

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