The road ahead: Potential synergies from ICT development are expected in the forthcoming national strategy

The role of the information and communications technology (ICT) sector in the Jordanian economy has grown tremendously over the past decade. In 2011 ICT generated about 14% of Jordan’s GDP, on par with sectors like the tourism sector, according to official data (see overview). As the industry grows, two key government players are responsible for guiding its development: the Ministry of Information and Communications Technology (MoICT) and the Telecommunications Regulatory Commission (TRC). The MoICT, created in April 2002, articulates policy for the IT, telecommunications and postal sectors, and works alongside other organisations to attract ICT investments to the country. The TRC, established under the 1995 Telecommunications Law, is charged with regulating the ICT and telecoms sectors, ensuring players are operating in line with legislation. Alongside these two government entities, the non-governmental Information and Communications Association of Jordan (int@j) works to represent the interests of the kingdom’s ICT companies. Founded in 2000, the organisation works with the government to develop regulations and lobby for companies at the government level. Through other initiatives, int@j also promotes ICT exports and foreign investment in Jordan.

MAPPING THE FUTURE: The private sector and the government led the development of the country’s ICT strategy in five-year increments. The previous strategy, from 2007 to 2011, aimed to achieve an internet penetration rate of over 50%, ICT employment of 35,000 and sector revenues of $3bn by the end of 2011. While the first benchmark was met, a combination of factors, including the global financial crises, prevented stakeholders from reaching the other two.

Although the government did not release a new five-year ICT strategy in 2012, it did publish a Statement of Government Policy on the ICT and Postal Sectors. The document focuses on far-reaching national strategies, including using the ICT sector to drive development, create jobs and boost other sectors. The statement also outlines several broad goals, such as improving the business environment, stimulating IT demand from domestic businesses and promoting individual use through education. A new long-term plan, however, is forthcoming. A draft, already available to the public, covers the period between 2013 and 2017 and outlines its focus areas, including infrastructure development and cross-sector connections.

A SOLID BACKBONE: Continued infrastructure development, the document says, is crucial to ensuring that technologies developed in Jordan are relevant in other markets. Since the government often faces challenges with financing, the strategy suggests a continuation of public-private partnerships (PPPs) that allow the state to tap private funds for key public projects. Relatively small tweaks to legislation can create major changes in this regard. The draft National ICT Strategy 2013-17 highlights opportunities for cooperation between ICT authorities and other parts of government. Working with the Ministry of Housing and Public Works, for example, stakeholders could help draft regulations that make the inclusion of web infrastructure like internet exchanges mandatory with road and highway construction. In this way, the authorities can ensure IT infrastructure develops in tandem with other infrastructure.

These small changes in regulation could also help lay the groundwork for larger projects, such as the National Broadband Network (NBN) that is under construction. The authorities intended to build the fibre backbone to connect the kingdom’s public institutions, including government agencies, hospitals and schools.

Construction began in 2003 and by 2008, after $36m of state investment, was about 35% complete. In that year, however, funding for the project had dried up, so in February 2012, the government announced a bidding process for telecoms operators that would like to take on the network in the form of a PPP. Although several firms expressed interest in becoming a partner or owning a stake in the project, no formal bids were submitted. As a result, the government plans to float tenders for parts of the project. In January 2013 officials announced a forthcoming JD30m ($42m) contract to connect 750 public hospitals to the network.

The government is also looking into ways to piggyback onto privately owned telecoms infrastructure. “Using the telecoms operators’… existing infrastructure will significantly reduce the cost of the project,” Minister of ICT Hatem Halawani told The Jordan Times in January 2013. Indeed, the country’s internet operators have been prolific in laying fibre, and networks rarely operate at full capacity. Therefore, utilising this excess space could offer a way for the NBN to avoid wasting resources on redundant lines. Some telecoms operators have already indicated that they would be interested in leasing parts of their networks to the state for a national fibre backbone. With tenders set to float and infrastructure-sharing schemes beginning to emerge, the prospects for progress on the NBN are looking increasingly promising.

COPPER LINES: The draft National ICT Strategy 2013-17 also points out that the kingdom already possesses an invaluable resource beneath its soil: its copper telephone lines. These lines, currently held as a monopoly by the partly government-owned Jordan Telecom Group (JTG), were built by the state years ago when all telecommunications in the country were still publicly run. Copper lines, although not as fast as their fibre counterparts, provide a relatively cheap way to provide high-speed internet to virtually any home that already has a phone line. The National ICT Strategy 2013-17 supports the ongoing unbundling of the copper network. Some progress has already been made. In September 2011 the TRC posted the conditions for JTG’s unbundling of the local copper loop. The completion of this process could offer a boost to competition and expand inter-net use, since more firms could introduce services that cater to different segments (see Telecoms chapter).

CONNECTING THE DOTS: As the kingdom’s IT infrastructure continues to grow, the sector’s potential to benefit other areas of the economy is set to rise. The draft strategy envisions authorities acting to bridge the gap between Jordan’s ICT stakeholders and those in important knowledge-based sectors in the country. Among others, the document highlights medicine, architecture, engineering, pharmaceuticals, tourism and education. The idea is to harness the country’s ICT prowess to enhance development in other areas of the economy.

The country’s “Hakeem” electronic health records programme represents an example of a potential crossover between IT and medicine. Introduced in October 2009, the e-health initiative connects hospitals with a database of patients’ medical histories. In July 2012, after successful pilot implementations at Prince Hamzah Hospital and Amman Comprehensive Clinic, programme authorities announced the project would be expanded to three more clinics: King Hussein Cancer Centre, Prince Hussein Hospital and the Ain Al Basha Health Centre. Wider implementation of electronic records could improve the standard of health care services while reducing operating costs.

CONTENT: A growing digital content segment represents another area for potential IT crossover. Jordan already produces the lion’s share of Arabic content on the web, and the National ICT Strategy 2013-17 calls on the government to continue supporting this segment. Since the introduction of 3G services in 2010, Jordan has seen major gains in internet penetration, which rose from 53% to 67% in 2012 alone, according to TRC data. An increase in internet users, namely mobile internet users, creates a mutually beneficial situation for media, IT and telecoms sectors. For media companies, it means new revenue streams and a larger audience for music, movies and other content. For the IT sector, it means more opportunities for programmers who help create, digitise and manage content online. For telecoms operators, meanwhile, it means returns on their recent 3G investments as their new networks see more traffic (see Telecoms chapter).

Both public and private stakeholders recognise that there is much at stake with the ICT strategy. Although the previous sector plan faced hurdles, there are several positive signs going forward. Infrastructure investments have been ongoing, thanks to booming mobile data demand and rising internet use. Exports have also been strong. Compared to the domestic market, export revenues fell by far less during the global financial crisis, and they are bouncing back more quickly. These and other factors indicate the IT sector is in a stronger position as it gears up to enter the upcoming five-year plan.