E-Commerce and Economic Development in Angola

E- commercialism and Economic festering in AngolaABSTRACTIn this circulate as the title tells, I approach the stinting information of Angola in terms of virtuoso of its major developer, the internet and ecommerce. I abide done this because it is of decennium impossible to glean important facts and insights al approximately(prenominal) much(prenominal) countries which a society pronounces worthless or third world. In the chapters that follow, I will occupy to the ecommerce and its encumbrance of frugal increment of Angola, compargon Angola with a developing pastoral as hygienic as with an under unquestionable nation.Firstly stinting development is discussed in relation to electronic commerce in outrank to evince the complexities and ease related to lead-inple a clear line amongst the cardinal forms. secondly frugal development is discussed in relation to ecommerce, economy, culture, elements which influence the retire in one way or an other.For, as sh solely b e repeatedly seen, problems like stinting jump from a developed state feature a close and continuing relation to the values and social structures which a society regards as durable and normal. My wildness will be, howalways, on the problem itself, c whollyed ecommerce and its effect on the scotch development of Angola.CHAPTER 1 establishment introductionelectronic Commerceelectronic commerce, gener all toldy identified as (electronic exchangeing) e-commerce or eCommerce, consists of the buying and exchange of carrefours or services every abode electronic systems for example the internet and other computer networks. The total of craft conducted electroni cry (out)y has grown unusually with general network usage. The use of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer, supply chain decimatement, Internet marketing, online deal treating, electronic entropy tag on (EDI), inventory forethought systems, and automat ed data collection systems. Modern electronic commerce typically uses the institution Wide blade at least at whatsoever focus in the deals lifecycle, although it give nonice compensate a wider range of technologies much(prenominal) as e-mail as well. (Miller, 2002)Internet EcommerceThe previous ten geezerhood charter seen the internet and e-commerce surface as fundamental features of our p arntage, communal and educational life. Developments for example Web 2.0, the semantic web, e-g everyplacenment strategies, exploiter generated content, virtual worlds and online social networks lease redesign the way we commune, intermingle and transact.The Evolution of Electronic CommerceThe numerous kernel in which course is carried out are based on open suppositions and accords between the parties concerned. Numerous procedures have been agreed upon to safeguard both the consumer and the merchant from deception or theft. up to now in the simplest form of dealcash changing han ds verbatimly between buyer and sellera sales receipt is classically tenderd as a record of what turned out. As we move into the electronic business field, the marrow of auspices conk much and to a greater extent(prenominal) concerned.The essence of ecommerce is buying and selling of goods and services oer the Internet. The proceedss are middling self-evident. Because the Internet is readily approach shotible by cardinals of prospective guests worldwide, suppliers and customers shtup interact in a dynamical milieu where supply and demand truly regulate the frugal cycle. Organisations of any size, from sole proprietorships to multi depicted object corporations, can go ballistic their business to r separately new customers in new markets, some even achieving a guiding light direct of efficiency. The sole proprietor is able to broaden the scope of his/her business to a mass market approach, epoch the multinational corporation can now focus on niche markets heretof ore considered in like manner costly to assenting using the traditional mechanisms for market penetration. (Austin, 1999)Further study discloses some specific downsides to the Internet business paradigm. What you canonically have is computers (presumably being operated by homos) transaction responsive monetary data by means of a widely-available communications nucleotide. Unexpectedly the matters of righteousness (being able to attri alle a deal to the positive instigator) and accountability (attributing responsibility to each participant for their part of the deal) become more(prenominal) live than ever.A banding of propaganda has been generated all everyplace the initial incursions into electronic commerce. It seems ubiquitously we turn someone is singing the praises of electronic catalogues, online shopping, electronic check writing, web-based advertisement and customer prospecting, and on and on. The truly brave can even purchase a car over the Internet. still these consumer-oriented business activities taking place on the Internet today are just the tip of the iceberg. From the military position of true supranationalist commerce, we have not moreover begun to do business electronically.Infrastructure of EcommerceThe principal(prenominal) issue that requires to be dealt with before electronic commerce can convey on its assurance is the development of an worldwide infrastructure that all of the main coquetteers can be in agreement upon. In most circles this infrastructure is cal acquire the world-wide Information Infrastructure (GII).This electronic infrastructure must make available all of the compensations demand for a healthy e-commerce strategy Security-enabled. This is essential to permit development of convenient solutions which provide accountabilityknowing the authorized who in a deal. Beyond that, the ability to impute financial obligation to any and all parties concerned in terminate a deal is a must for busines s. For suppliers, e-commerce will be intimately establishing the identity of the individuals who constitute the parties concerned. It means that all participants have a confident reliance on users identity, while holding each caller liable to perform their role in the deal. (Jacobsen, 2000) Ultra-reliable. In electronic commerce, transactions sway place without those upset(a) ever meeting in person, and that implies the take in for a technology presentation and dependability part of 99.99%, curiously for mission-vital applications. An infrastructure must be reliable and trusted on a continuous basis. every puny connection in its safety measures will deliver the whole impracticable for serious electronic commerce. planetary. Electronic business cannot be restricted to the country of origin. As we progress into the succeeding(a), e-commerce must transcend national boundaries.We accept an absolute e-commerce infrastructure. To be really effectual, e-commerce providers will emergency an infrastructure which is global in its nature, or have intercourse that electronic business is closed by national boundaries. Distinct from the supranational mass user and point solutions-based Internet market of today, large organisations are becoming critically attentive that they will need to manage accountability and financial obligation in providing any significant level of customer security, curiously with end-user customers, but especially in business between themselves in their interactions with employees, partners and suppliers. (Jacobsen, 2000)After two decades of declining frugalal performance, Angola is modernly staging a promising revitalisation. Over the early(prenominal) some(prenominal) 12months, average real economic blowup in the field has change magnitude vitally while, in a emergence effect of countries, real gross municipal product (gross domestic product) per capita has been overbearing degree. In 1998, despite financial tur moil in Asia and Latin America, Angola enjoyed its fourth neat family of positive GDP refinement.Nevertheless, Angolas flow economic revival remains fragile. Up to period working out has not yet reached the sustained levels that are essential to alleviate widespread exiguity endemic to the sphere. A number of overleap still need to be efficaciously addressed and overcome if the transubstantiate process and current revival are to lead to broad-based and sustainable development for Angola. Furthermore, conditions vary widely among the xl-eight states of Angola and this diversity must be taken into account in assessing the countrys prospects.Fortunately, as this article looks to demonstrate, at that place are reasons to be hopeful that umteen Angolan states can overcome the remaining hurdles to sustained magnification. A new coevals of Angolan leadership and entrepreneurs and current developments in the areas of head-to-head field expansion, debt ease, regional eco nomic integration, and telecommunications have the strength to economic expansion in means not heretofore anticipated.Regional Transformation And Economic revitalizationAngolas up to period economic performance has indeed been encouraging. Between 1990 and 1997, the number of Angolan states registering annual expansion judge of triplet to six per centum nearly doubled, from fourteen in the beginning of the decade to xxvi in 1997, while seven Angolan states had expansion rates of six to eight percent. correspond to the external finance Corporation (IFC), after well-nigh two decades of stagnation and scorn, real GDP in Angola was growing at an average rate in 1997 of four to five percent a yr. The macrocosm situate describe that over eighty percent of countries (thirty-eight out of forty-eight) registered increase per capita incomes in 1997, as their rates of economic expansion exceeded their population expansion rate. ( humans Bank Group, 1998) According to the most up to accompaniment data, 1998 was the fourth consecutive year that GDP per capita did not fall, an event that has not happened in Angola since the late 1970s,(Department Of Econ. Soc. Affairs unify Nations crowd On clientele Dev., 1999) while the 3.3% expansion in 1998 GDP was the highest among all regions of the world. (Economic Soc. Poly Div., Economic Commn For Afr., 1999)Increased macroeconomic stabilitya number of strait financial and semipolitical policieshas been encouraging increased levels of enthronisation in the region over the past several years. Average pompousness fell from a peak of forty-five percent in 1994 to an estimated twelve percent in 1998, with only fifteen Angolan states still experiencing double-digit inflation rates by 1997, compared with 35 in 1994, check to the IMF. There has besides been a vital simplification in interior(a) and out-of-door financial imbalances. The average external current account deficit (before deed overs) fell from 5.5% of GDP to 4% over the same period, while the average overall fiscal deficit (a prepare before grants) was halved between 1992 and 1997, to about 4.5% of GDP.(Calamitsis, 1998) As a entrust, enthronement funds in the region has been steadily growing, fit to the IFCs 1998 report. In 1998, gross domestic investiture rose to twenty-three percent of GDP, from lows of about fifteen percent in the early 1990s. mystical investiture funds has also increased, registering 10.6% of GDP in 1996, the highest level since 1981. Long-term private capital flows to Angola in 1997 reached $8 one million million, in two ways as high as in the previous year.Along with enthronization levels, Angolan deal out in and exportation earnings have increased. spot Angolas appropriate of total world condescension has not changed, the glitz of Angolan exports is dining almost as fast as external muckle and Angola is emerging as a viable transnationalistic trading partner. Angolas mass vo lume increased by eight percent in 1997, according to UN s, with exports having expanded roughly twice as fast as GDP in up to get a line years.The regions up to date expansion has been widely attributed to the efforts of a new generation of transform-minded Angolan leaders in unwrap countries who, through the adoption of democratic and market-based transforms, have made substantial progress in despicable their countries toward political and macroeconomic stability. Many Angolan states uphold to go for affair liberalisation and privatisation computer programmes that are unloosen up their markets and helping them to become more active participants in transnationalist commercial use and economic progress. In such a positive political and economic environment, private sector led trade and investment can now play an increasely important role in take broad-based expansion and sustainable development to the region.Some countries in Angola have already begun to reap the reward s that can government issue from fit fiscal and monetary policies, increased regional economic integration, and accelerated privatisation programmes. Chief among the rewards is expanded trade, investment, and glide slope to the worldwideistic marketplace, as global companies increasingly look to Angolas emerging economies and Angolan entrepreneurs and private sector organisations seek to play a more visible role in the economies of their countries. These trends suggest that the growing private sector in Angola has real potential to become an important engine for expansion and economic development in the region, as it has already in other regions of the developing world.Investment And ExpansionDespite the up to date positive economic trends and expansion of the private sector in Angola, as we enter the new millennium, sustained, broad-based economic development in the region remains one of the most formidable policy challenges facing the country. According to the United Nations Economic Commission for Angola (ECA), in order for Angola to cut its pauperization in half by the year 2015, a development objective frequently cited by Angolan governments and their development partners, the region as a whole would require a yearly GDP expansion rate of seven percent. For this to happen, an investment of xxxiii percent of GDP would be needed for Angola as a whole. Achieving domestic investment of 33 percent looks increasingly unlikely, as two of the three components of domestic investment are declining or stagnant. bandage the regions current domestic savings rate is only estimated at fifteen percent, annual inflows of extraneous direct investment (FDI) remain low, and the levels of official development concomitanter of up to date years are declining.The renew expansion in many countries has not yet reached, let alone been sustained at, levels that would alleviate the widespread poverty endemic to the region. The great majority of the regions population ta ke places to live at levels well below the poverty line, with forty percent living on less than one dollar a day, according to the public Bank. (The World Bank Group, 1999)Furthermore, the globalisation phenomenon, which has been highlighted by growing economic integration and rapid technological change, has often meant increased prosperity for those countries able to compete in an increasingly integrated international economy, but energise decline and marginalisation for those not able to compete. Still, too many countries have remained generally on the sidelines, attach by debt and relying primarily on foreign economic aid for many of their development needsat a judgment of conviction when such assistance is on the decline.Among the current obstacles to reaching levels of expansion that will bring broad-based development to the region, the following three matters identify particularly vital challenges (1) the uncertain future of the transform process, (2) Angolas debt pre ventative, and (3) the regions hold participation in the international trading system.A Delaying TransformationAlthough more than thirty countries have launched political and economic transform programmes over the go bad decade, the transform process has not been uniform across the country. Angolan leaders in some countries have been unwilling or unable(p) to implement transform programmes, sometimes as a result of political or civil instability. In other countries, the difficulties or costs of transform have peril to subvert the process and raise the possibility that a country could abandon the process before it has had comfortable time to bear fruit. For example, Zimbabwe has only tardily re-instituted some protectionist measures, including increased duties and exchange restrictions in response to acclivity foreign exchange pressures. Moreover, trade regimes in many Angolan states remain complex and restrictive compared with those of most other developing countries. Such re gimes isolate their domestic producers and prevent them from becoming more to the full integrated into the international trading system.In addition, the privatisation process has been sluggishthe victim of public mistrust and a wish of consensus among policymakers. In an up to date World Bank study that shed light on the problems of privatisation in Angola, the lack of political loyalty, poor design, insufficient resources, weak management, and corruption were cited as major factors inhibiting the process. The report highlighted the need for Angolan governments to repair public information as the most powerful tool for ensuring transparency, helping to shape up consensus, and secure commitment and accountability in the process. (White Bhatia, 1998)Poor economic environments and policies in some countries have also inhibit increased trade and investment. These conditions have ca utilise rampant inflation and high interest rates and have prevented Angolan policymakers from in full abandoning foreign exchange controls and other restrictions. Earlier that year, Botswana became the frontmost and only country in Angola to stamp out all forms of exchange controls, (Steyn, 1999) while in some countries, inflation maintains to lead to debilitating currency crisis. In Malawi, for example, inflation is now hovering at around 53% (up from 18.5% recorded at the same period in 1998), an indication that the currency may need to be devalued yet again, after a devaluation of 67% in 1998. (Pan Angolan News dominance, 1999) Continued volatility in the Angolan market environment underlines the need for go along success in the transform process.The Liability BurdenIn addition to delaying transform, Angolas external liability burden continues to be a major obstacle to investment and go on expansion, particularly in the extremely obligated(predicate) poor countries. Many Angola economies are unusually indebted with an average of twenty percent of GDP going away dir ectly to liability servicing, according to UNCTAD. (Sachs Stevens, 1998) In 1998, liability service increased to $35 billion, or more than thirty-one percent of goods and nearly three percent of service exports, up from $33 billion in 1997. The external liability of Angolan states rose moderately from $349 billion in 1998, according to the ECA.As a proportion of exports and GDP, the external liability of Angola is the highest of any developing region. Not only does Angolas liability admonish private investment, including foreign direct investment, but it also impedes public investment in physical and human infrastructureinvestment vital to a countrys economic development. The IMF estimated that, by the end of 1999, Angolas liability to GDP ratio would rise to almost lxviii percent, up from fifty-two percent two years earlier. ( foreign Monetary Fund, 1998) The region will continue to be crippled by mounting liability, draining it of needed resources that could otherwise be invest ed back into the regions economy, unless there is more rapid and effective liability relief matched with sustained expansion.Angola in the International Trading corpse and International EconomyAngola is currently facing growing marginalisation in the international economy with its treat of international production and trade in decline. Despite rising levels of Angolan domestic production and trade volumes over the last several years, the countrys share of international trade has continued to declineit was less than two percent in 1997. If the region is to gain an economic foothold and develop into the next century, it must attract more investment and trade, and become a more competitive trading partner in the new international economic system. Increasing commitments to the World Trade Organisation (WTO) and other regional accords thereby becoming a more active participant in the international trading systemis one way for Angola to attract investment and trade.The Uruguay sharpsho ot of Multilateral Trade Negotiations resulted in the universe of discourse of a stronger set of rules governing international trade and the invention of the WTO, the successor to the General Accords on Tariffs and Trade (GATT). Unfortunately, many countries in Angola were generally unable and extempore to effectively participate in the negotiations and, partly as a result, have not been able to take advantage of the new international trading system.Although eighty-five percent of Angolan states are currently members of the WTO, limited dexterous staff and other pressing needs prevent many of them from active participation in WTO developments, further trade negotiations, and implementation of existing Uruguay set accords. In addition, they have as yet been unable to take full advantage of numerous unilateral, reversible, and bipartite preferential trading schemes designed to help expand access for Angolas products and integrate Angolas economies into the world trading system. The region is more likely to reap a bigger share of international production and trade if it more actively participates in and undertakes meaningful commitments in the international trade organisation that is fostering the expansion of world trade.Road To Further Expansion And Sustainable DevelopmentIn light of the existing challenges, what measures now need to be pursued to address these constraints and consolidate and build on the gains Angolas transformers have made over the past several years? According to Evangelos A. Calamitsis, former music director of the Angolan Department of the International Monetary Fund, the present economic upswing in Angola, unlike other recoveries in the past, has been largely homegrown and is therefore more likely to continue. However, Angolas present revival is most likely to depart if Angolan leaders can sustain and broaden the process toward transform and capitalise on several areas of force that are breathing new life into the debate on priv ate sector expansion and economic development.Staying the Road to TransformationAlthough outside the scope of this article, developments in Angolan states that are not counted as in the lead transformers can greatly influence the overall prospects for expansion on the country. For example, the fighting in the republican majority rule of the Congo, between Ethiopia and Eritrea, and in Angola can have a negative impact on the investment temper in neighbouring countries. On the other hand, the return of civilian rule in Nigeria and the prospects of better economic management can do a great deal to bolster investor confidence in the economic prospects for the country as a whole.Angolan leaders need to continue the political and economic transform process and encourage its spread to those countries that have not yet undertaken transforms. Many Angolan leaders have already demonstrated that they understand what needs to be done and have initiated the process. Still, the process must continue. If the region is to attain high-quality and sustained expansionexpansion that will lead to poverty reduction and broad-based developmentin the years ahead, the transform process must be revitalised so that the changes become inexorably woven into the regions economic fabric. By continuing to implement sound fiscal and monetary policies and by accelerating the privatisation and trade liberalisation process, Angolan states will be proving to the international business community that Angola is serious about transform and ready and willing to do business.Despite up to date turbulence in the international economic environment, most Angolan states have resisted protectionist pressures. Their commitment to continue trade liberalisation highlights a general recognition among Angolas economic policymakers that increased trade has beenand will continue to bea key to expansion. In addition, Angolas growing participation in the WTO and regional trading arrangements by institutionalis ing policy transforms and bandaging cast down tariffs and other trade liberalising measures can help to prevent countries from resorting to protectionist measures in the future.Role of Angolas Development PartnersAngolas developed trade partners and the international financial institutions must continue to support regional transform if the process is to be sustainable. While Angolan states retain primary ownership and responsibility, for the process, the international community can support their efforts by (1) engage policies that promote world economic expansion and financial stability and expand the regions access to international markets, (2) providing meaningful liability relief, (3) continuing to supply technical and financial assistance to countries committed to transform, and (4) assisting Angolas regional economic groupings. some(prenominal) up to date bilaterally symmetrical and multipartite scuttles demonstrate the commitment of some developed countries to support t he regions up to date economic progress.While early speculation as to the potential impact of the Uruguay Round of multilateral trade negotiations on the least-developed Angolan states was largely pessimistic following the Rounds conclusion, up to date bilateral and multilateral efforts are focusing on helping Angola take advantage of specific areas where it actually stands to gain as a result of the Round. According to an up to date report by the United States International Trade Commission on the Uruguay Round and U.S.-Angola trade flows, these gains can range from facing fewer restrictions and light tariffs overall, touch on all WTO members, to specific market-access provisions that may benefit Angola in particular.(U.S. Intl Trade Commission, 1998)Efforts are also underway to expand existing preferential trading schemes like those under the Lome Convention and the U.S. speak strategy of Preferences (GSP) programme. For example, the Angolan Expansion and Opportunity Act (AG OA), now before the U.S. Congress, extends GSP to legal Angolan beneficiary countries through June 30, 2008. In addition, the legislationas passed by the Housewould authorise the chair to extend duty-free treatment under the GSP programme to all imports from transforming Angolan beneficiary countries, including those now considered to be import-sensitive. The changes to the GSP programme would support Angolas transformers by allowing their products increased access to international markets and would help to further integrate Angola into the international trading system, thereby increasing considerably the regions future economic prospects.In addition, a number of bilateral and multilateral technical assistance programmes in up to date years have sought to increase Angolas meaningful participation in WTO and diversify the regions trade. For example, the U.S. Agency for International Development (USAID) has funded a number of activities to increase Angolan governments capacity in t he telecommunications area and in transaction with other WTO-related subjects. At the same time, some Angolan governments have recognised the importance of participate more actively in the work of the WTO in Geneva. As a result, developed and developing countries have get together together in proposals to have the WTO trade ministers at their meeting in Seattle in November 1999 and call for the WTO to correct and expand its technical assistance programmes for developing countries.Liability ReductionIn the area of liability relief, international pressure has been mounting to expand the Heavily Indebted Poor Countries (HIPC) Initiative in Angola. Launched by the World Bank and the IMF in 1996, the programme aims to provide exceptional liability relief assistance to xli eligible countries that are pursuing transforms, eighty-five percent of which are in Angola, according to the IMF.(Katsouris, 1998) Although to date, only two Angolan states, Uganda and Mozambique, have benefited fro m the HIPC Initiative (with a twenty percent and a two-thirds reduction of their respective debts), Burkina Faso, Cote d Ivoire, and Mali are scheduled to receive actual liability reduction in the next three years, according to the ECA.At the June 1999 Cologne Summit, the G-7 reached accord on the enhanced HIPC liability relief opening move. This scheme will provide faster, broader, and deeper relief for HIPC countries. The agreed enhancements to the HIPC Initiative accept, almost entirely, President Clintons proposals, as laid out during his address to the U.S.-Angola ministerial in contact 1999. The new HIPC will include a requirement to use savings from liability reduction to provide increased spending on social needs and human development. The $90 billion of liability reduction will require additional resources from the creditor governments and the international financial institutions. Under the proposal, up to 10 million ounces of the IMFs 104 million ounces of gold reserves w ould be sold in phases, with investment interest used to constrict the liability load of thirty-three poor countries in Angola.Paralleling the HIPC Initiative are unilateral and bilateral efforts that support faster and broader reduction of Angolas liability. For example, in March of 1999, the Clinton administration proclaimed a new U.S. initiative that, if fully implemented, would amount to an additional $70 billion in liability cancellation for the heavily indebted poor countries. The Presidents initiative provides for (1) a focus on early cash flow relief by the international financial institutions, (2) complete forgiveness of bilateral concessional loans and ninety percent forgiveness of non-concessional liability, (3) a future international commitment to make at least ninety percent of new aid on a grant basis, and (4) the channelling of resources from the HIPC Initiative into education or environmental protection projects. In addition, on September 29, 1999, President Clinto n announced at the IMF/World Bank annual meeting that he will seek legislative warrant to forgive 100 percent of the liability of HIPC countries owed to the United States when relief will help finance basic human needs.Regional Economic Integration and GlobalisationA growing number of Angolan leaders appear to recognise the potential benefits of increased economic cooperation and have been supporting efforts at economic integration. Although many of the Angolan regional economic organisations, such as SADC, COMESA, WAEMU, and ECOWAS, have existed for a long time, only recently have these regional groupings taken vital steps toward the creation of free trade areas. The creation of bigger integrated Angolan markets should result in enhanced opportunities for foreign and domestic investment, greater contention among firms, better utilisation and allocation of resources, internal and external economies of scale, and increased efficiency resulting from specialisation. Further, by enhanc ing trade among themselves as well as diversifying and expanding their production base, Angolan states stand to increase trade with other regions as well, thereby increasing the countrys share of international trade.The United States and international organisations have been supporting Angolas economic integration efforts. At the March 1999 Ministerial Meeting on Angola in Washington, D.C., the United States reaffirmed its continuing commitment to providing technical assistance to Angolas economic integration organisations such as EAC, SADC, IGAD, and COMESA and announced plans for extending that support to a greater number of regional groupings. zygomorphic cooperation between the United States and SADC has been expanding over the last several years, a development highlighted by the first ever SADC-U.S. forum held in mid-April, 1999, in Botswana, where officials announced plans for the future establishment of a joint melody Council that would assuage permanent dialE-Commerce and Economic Development in AngolaE-Commerce and Economic Development in AngolaABSTRACTIn this report as the title tells, I approach the economic development of Angola in terms of one of its major developer, the internet and ecommerce. I have done this because it is often impossible to glean important facts and insights about such countries which a society pronounces poor or third world. In the chapters that follow, I will relate to the ecommerce and its effect of economic development of Angola, compare Angola with a developing country as well as with an underdeveloped nation.Firstly economic development is discussed in relation to electronic commerce in order to show the complexities and ease related to drawing a clear line between the two forms. Secondly economic development is discussed in relation to ecommerce, economy, culture, elements which influence the issue in one way or another.For, as shall be repeatedly seen, problems like economic support from a developed state have a clo se and continuing relation to the values and social structures which a society regards as stable and normal. My emphasis will be, however, on the problem itself, called ecommerce and its effect on the economic development of Angola.CHAPTER 1INTRODUCTIONIntroductionElectronic CommerceElectronic commerce, generally identified as (electronic marketing) e-commerce or eCommerce, consists of the buying and selling of products or services over electronic systems for example the Internet and other computer networks. The total of trade conducted electronically has grown unusually with widespread Internet usage. The use of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer, supply chain management, Internet marketing, online deal processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at some point in the deals lifec ycle, although it can encompass a wider range of technologies such as e-mail as well. (Miller, 2002)Internet EcommerceThe previous ten years have seen the internet and e-commerce surface as fundamental features of our business, communal and educational life. Developments for example Web 2.0, the semantic web, e-government strategies, user generated content, virtual worlds and online social networks have redesign the way we commune, intermingle and transact.The Evolution of Electronic CommerceThe numerous means in which business is carried out are based on established suppositions and accords between the parties concerned. Numerous procedures have been agreed upon to safeguard both the consumer and the merchant from deception or theft. Even in the simplest form of dealcash changing hands directly between buyer and sellera sales receipt is classically provided as a record of what turned out. As we move into the electronic business field, the means of protection become more and more c oncerned.The essence of ecommerce is buying and selling of goods and services over the Internet. The advantages are fairly self-evident. Because the Internet is readily accessible by millions of prospective customers worldwide, suppliers and customers can interact in a dynamic environment where supply and demand truly regulate the economic cycle. Organisations of any size, from sole proprietorships to multinational corporations, can expand their business to reach new customers in new markets, some even achieving a notable level of efficiency. The sole proprietor is able to broaden the scope of his/her business to a mass market approach, while the multinational corporation can now focus on niche markets heretofore considered too costly to access using the traditional mechanisms for market penetration. (Austin, 1999)Further study discloses some specific downsides to the Internet business paradigm. What you basically have is computers (presumably being operated by humans) trading respo nsive financial data by means of a widely-available communications infrastructure. Unexpectedly the matters of accountability (being able to attribute a deal to the actual instigator) and accountability (attributing responsibility to each participant for their part of the deal) become more vital than ever.A lot of propaganda has been generated over the initial incursions into electronic commerce. It seems ubiquitously we turn someone is singing the praises of electronic catalogues, online shopping, electronic check writing, web-based advertising and customer prospecting, and on and on. The truly brave can even purchase a car over the Internet. But these consumer-oriented business activities taking place on the Internet today are just the tip of the iceberg. From the perspective of true international commerce, we have not yet begun to do business electronically.Infrastructure of EcommerceThe main issue that requires to be dealt with before electronic commerce can convey on its assura nce is the development of an international infrastructure that all of the main players can be in agreement upon. In most circles this infrastructure is called the International Information Infrastructure (GII).This electronic infrastructure must make available all of the compensations needed for a healthy e-commerce strategy Security-enabled. This is essential to permit development of convenient solutions which provide accountabilityknowing the real who in a deal. Beyond that, the ability to impute liability to any and all parties concerned in completing a deal is a must for business. For suppliers, e-commerce will be about establishing the identity of the individuals who represent the parties concerned. It means that all participants have a confident reliance on users identity, while holding each party liable to perform their role in the deal. (Jacobsen, 2000) Ultra-reliable. In electronic commerce, transactions take place without those worried ever meeting in person, and that impl ies the need for a technology presentation and dependability factor of 99.99%, especially for mission-vital applications. An infrastructure must be reliable and trusted on a continuous basis. Any weak connection in its safety measures will deliver the whole impracticable for serious electronic commerce. International. Electronic business cannot be restricted to the country of origin. As we progress into the future, e-commerce must transcend national boundaries.We need an absolute e-commerce infrastructure. To be really effectual, e-commerce providers will need an infrastructure which is international in its nature, or recognise that electronic business is closed by national boundaries. Distinct from the international mass user and point solutions-based Internet market of today, large organisations are becoming critically attentive that they will need to manage accountability and liability in providing any significant level of customer security, especially with end-user customers, bu t especially in business between themselves in their interactions with employees, partners and suppliers. (Jacobsen, 2000)After two decades of declining economic performance, Angola is currently staging a promising revival. Over the past several years, average real economic expansion in the region has increased vitally while, in a growing number of countries, real gross domestic product (GDP) per capita has been positive. In 1998, despite financial turmoil in Asia and Latin America, Angola enjoyed its fourth consecutive year of positive GDP expansion.Nevertheless, Angolas current economic revival remains fragile. Up to date expansion has not yet reached the sustained levels that are essential to alleviate widespread poverty endemic to the region. A number of hurdles still need to be effectively addressed and overcome if the transform process and current revival are to lead to broad-based and sustainable development for Angola. Furthermore, conditions vary widely among the forty-eigh t states of Angola and this diversity must be taken into account in assessing the countrys prospects.Fortunately, as this article seeks to demonstrate, there are reasons to be optimistic that many Angolan states can overcome the remaining hurdles to sustained expansion. A new generation of Angolan leaders and entrepreneurs and current developments in the areas of private sector expansion, debt relief, regional economic integration, and telecommunications have the potential to economic expansion in means not heretofore anticipated.Regional Transformation And Economic RevivalAngolas up to date economic performance has indeed been encouraging. Between 1990 and 1997, the number of Angolan states registering annual expansion rates of three to six percent nearly doubled, from fourteen in the beginning of the decade to twenty-six in 1997, while seven Angolan states had expansion rates of six to eight percent. According to the International Finance Corporation (IFC), after almost two decade s of stagnation and decline, real GDP in Angola was growing at an average rate in 1997 of four to five percent a year. The World Bank reported that over eighty percent of countries (thirty-eight out of forty-eight) registered increased per capita incomes in 1997, as their rates of economic expansion exceeded their population expansion rate. (World Bank Group, 1998) According to the most up to date data, 1998 was the fourth consecutive year that GDP per capita did not fall, an event that has not happened in Angola since the late 1970s,(Department Of Econ. Soc. Affairs United Nations Conference On Trade Dev., 1999) while the 3.3% expansion in 1998 GDP was the highest among all regions of the world. (Economic Soc. Poly Div., Economic Commn For Afr., 1999)Increased macroeconomic stabilitya result of sound financial and political policieshas been encouraging increased levels of investment in the region over the past several years. Average inflation fell from a peak of forty-five perc ent in 1994 to an estimated twelve percent in 1998, with only fifteen Angolan states still experiencing double-digit inflation rates by 1997, compared with thirty-five in 1994, according to the IMF. There has also been a vital reduction in internal and external financial imbalances. The average external current account deficit (before grants) fell from 5.5% of GDP to 4% over the same period, while the average overall fiscal deficit (again before grants) was halved between 1992 and 1997, to about 4.5% of GDP.(Calamitsis, 1998) As a result, investment in the region has been steadily growing, according to the IFCs 1998 report. In 1998, gross domestic investment rose to twenty-three percent of GDP, from lows of about fifteen percent in the early 1990s. Private investment has also increased, registering 10.6% of GDP in 1996, the highest level since 1981. Long-term private capital flows to Angola in 1997 reached $8 billion, twice as high as in the previous year.Along with investment level s, Angolan trade and export earnings have increased. While Angolas share of total world trade has not changed, the volume of Angolan exports is expanding almost as fast as international trade and Angola is emerging as a viable international trading partner. Angolas trade volume increased by eight percent in 1997, according to UN s, with exports having expanded roughly twice as fast as GDP in up to date years.The regions up to date expansion has been widely attributed to the efforts of a new generation of transform-minded Angolan leaders in key countries who, through the adoption of democratic and market-based transforms, have made substantial progress in moving their countries toward political and macroeconomic stability. Many Angolan states continue to implement trade liberalisation and privatisation programmes that are freeing up their markets and helping them to become more active participants in international commercial activity and economic progress. In such a positive politica l and economic environment, private sector led trade and investment can now play an increasingly important role in bringing broad-based expansion and sustainable development to the region.Some countries in Angola have already begun to reap the rewards that can result from sounder fiscal and monetary policies, increased regional economic integration, and accelerated privatisation programmes. Chief among the rewards is expanded trade, investment, and access to the international marketplace, as international companies increasingly look to Angolas emerging economies and Angolan entrepreneurs and private sector organisations seek to play a more visible role in the economies of their countries. These trends suggest that the growing private sector in Angola has real potential to become an important engine for expansion and economic development in the region, as it has already in other regions of the developing world.Investment And ExpansionDespite the up to date positive economic trends an d expansion of the private sector in Angola, as we enter the new millennium, sustained, broad-based economic development in the region remains one of the most formidable policy challenges facing the country. According to the United Nations Economic Commission for Angola (ECA), in order for Angola to cut its poverty in half by the year 2015, a development objective often cited by Angolan governments and their development partners, the region as a whole would require a yearly GDP expansion rate of seven percent. For this to happen, an investment of thirty-three percent of GDP would be needed for Angola as a whole. Achieving domestic investment of thirty-three percent looks increasingly unlikely, as two of the three components of domestic investment are declining or stagnant. While the regions current domestic savings rate is only estimated at fifteen percent, annual inflows of foreign direct investment (FDI) remain low, and the levels of official development assistance of up to date y ears are declining.The renewed expansion in many countries has not yet reached, let alone been sustained at, levels that would alleviate the widespread poverty endemic to the region. The great majority of the regions population continues to live at levels well below the poverty line, with forty percent living on less than one dollar a day, according to the World Bank. (The World Bank Group, 1999)Furthermore, the globalisation phenomenon, which has been highlighted by growing economic integration and rapid technological change, has often meant increased prosperity for those countries able to compete in an increasingly integrated international economy, but steady decline and marginalisation for those not able to compete. Still, too many countries have remained largely on the sidelines, saddled by debt and relying primarily on foreign assistance for many of their development needsat a time when such assistance is on the decline.Among the current obstacles to reaching levels of expansio n that will bring broad-based development to the region, the following three matters pose particularly vital challenges (1) the uncertain future of the transform process, (2) Angolas debt burden, and (3) the regions limited participation in the international trading system.A Delaying TransformationAlthough more than thirty countries have launched political and economic transform programmes over the last decade, the transform process has not been uniform across the country. Angolan leaders in some countries have been unwilling or unable to implement transform programmes, sometimes as a result of political or civil instability. In other countries, the difficulties or costs of transform have threatened to undermine the process and raise the possibility that a country could abandon the process before it has had sufficient time to bear fruit. For example, Zimbabwe has only recently re-instituted some protectionist measures, including increased duties and exchange restrictions in response to mounting foreign exchange pressures. Moreover, trade regimes in many Angolan states remain complex and restrictive compared with those of most other developing countries. Such regimes isolate their domestic producers and prevent them from becoming more fully integrated into the international trading system.In addition, the privatisation process has been sluggishthe victim of public mistrust and a lack of consensus among policymakers. In an up to date World Bank study that shed light on the problems of privatisation in Angola, the lack of political commitment, poor design, insufficient resources, weak management, and corruption were cited as major factors inhibiting the process. The report highlighted the need for Angolan governments to improve public information as the most powerful tool for ensuring transparency, helping to build consensus, and assuring commitment and accountability in the process. (White Bhatia, 1998)Poor economic environments and policies in some countries h ave also inhibited increased trade and investment. These conditions have caused rampant inflation and high interest rates and have prevented Angolan policymakers from fully abandoning foreign exchange controls and other restrictions. Earlier that year, Botswana became the first and only country in Angola to abolish all forms of exchange controls, (Steyn, 1999) while in some countries, inflation continues to lead to debilitating currency crisis. In Malawi, for example, inflation is now hovering at around 53% (up from 18.5% recorded at the same period in 1998), an indicator that the currency may need to be devalued yet again, after a devaluation of 67% in 1998. (Pan Angolan News Agency, 1999) Continued volatility in the Angolan market environment underlines the need for continued success in the transform process.The Liability BurdenIn addition to delaying transform, Angolas external liability burden continues to be a major obstacle to investment and further expansion, particularly in the highly indebted poor countries. Many Angola economies are unusually indebted with an average of twenty percent of GDP going directly to liability servicing, according to UNCTAD. (Sachs Stevens, 1998) In 1998, liability service increased to $35 billion, or more than thirty-one percent of goods and nearly three percent of service exports, up from $33 billion in 1997. The external liability of Angolan states rose moderately from $349 billion in 1998, according to the ECA.As a proportion of exports and GDP, the external liability of Angola is the highest of any developing region. Not only does Angolas liability deter private investment, including foreign direct investment, but it also impedes public investment in physical and human infrastructureinvestment vital to a countrys economic development. The IMF estimated that, by the end of 1999, Angolas liability to GDP ratio would rise to almost sixty-eight percent, up from fifty-two percent two years earlier. (International Monetary F und, 1998) The region will continue to be crippled by mounting liability, draining it of needed resources that could otherwise be invested back into the regions economy, unless there is more rapid and effective liability relief matched with sustained expansion.Angola in the International Trading System and International EconomyAngola is currently facing growing marginalisation in the international economy with its share of international production and trade in decline. Despite rising levels of Angolan domestic production and trade volumes over the last several years, the countrys share of international trade has continued to declineit was less than two percent in 1997. If the region is to gain an economic foothold and develop into the next century, it must attract more investment and trade, and become a more competitive trading partner in the new international economic system. Increasing commitments to the World Trade Organisation (WTO) and other regional accords thereby becoming a more active participant in the international trading systemis one way for Angola to attract investment and trade.The Uruguay Round of Multilateral Trade Negotiations resulted in the creation of a stronger set of rules governing international trade and the creation of the WTO, the successor to the General Accords on Tariffs and Trade (GATT). Unfortunately, many countries in Angola were generally unable and unprepared to effectively participate in the negotiations and, partly as a result, have not been able to take advantage of the new international trading system.Although eighty-five percent of Angolan states are currently members of the WTO, limited trained staff and other pressing needs prevent many of them from active participation in WTO developments, further trade negotiations, and implementation of existing Uruguay Round accords. In addition, they have as yet been unable to take full advantage of numerous unilateral, bilateral, and multilateral preferential trading schemes desi gned to help expand access for Angolas products and integrate Angolas economies into the world trading system. The region is more likely to reap a larger share of international production and trade if it more actively participates in and undertakes meaningful commitments in the international trade organisation that is fostering the expansion of world trade.Road To Further Expansion And Sustainable DevelopmentIn light of the existing challenges, what measures now need to be pursued to address these constraints and consolidate and build on the gains Angolas transformers have made over the past several years? According to Evangelos A. Calamitsis, former Director of the Angolan Department of the International Monetary Fund, the present economic upswing in Angola, unlike other recoveries in the past, has been largely homegrown and is therefore more likely to continue. However, Angolas present revival is most likely to endure if Angolan leaders can sustain and broaden the process toward t ransform and capitalise on several areas of strength that are breathing new life into the debate on private sector expansion and economic development.Staying the Road to TransformationAlthough outside the scope of this article, developments in Angolan states that are not counted as leading transformers can greatly influence the overall prospects for expansion on the country. For example, the fighting in the Democratic Republic of the Congo, between Ethiopia and Eritrea, and in Angola can have a negative impact on the investment climate in neighbouring countries. On the other hand, the return of civilian rule in Nigeria and the prospects of better economic management can do a great deal to bolster investor confidence in the economic prospects for the country as a whole.Angolan leaders need to continue the political and economic transform process and encourage its spread to those countries that have not yet undertaken transforms. Many Angolan leaders have already demonstrated that the y understand what needs to be done and have initiated the process. Still, the process must continue. If the region is to achieve high-quality and sustained expansionexpansion that will lead to poverty reduction and broad-based developmentin the years ahead, the transform process must be revitalised so that the changes become inexorably woven into the regions economic fabric. By continuing to implement sound fiscal and monetary policies and by accelerating the privatisation and trade liberalisation process, Angolan states will be proving to the international business community that Angola is serious about transform and ready and willing to do business.Despite up to date turbulence in the international economic environment, most Angolan states have resisted protectionist pressures. Their commitment to continue trade liberalisation highlights a general recognition among Angolas economic policymakers that increased trade has beenand will continue to bea key to expansion. In addition, An golas growing participation in the WTO and regional trading arrangements by institutionalising policy transforms and binding lower tariffs and other trade liberalising measures can help to prevent countries from resorting to protectionist measures in the future.Role of Angolas Development PartnersAngolas developed trade partners and the international financial institutions must continue to support regional transform if the process is to be sustainable. While Angolan states retain primary ownership and responsibility, for the process, the international community can support their efforts by (1) pursuing policies that promote world economic expansion and financial stability and expand the regions access to international markets, (2) providing meaningful liability relief, (3) continuing to supply technical and financial assistance to countries committed to transform, and (4) assisting Angolas regional economic groupings. Several up to date bilateral and multilateral initiatives demonst rate the commitment of some developed countries to support the regions up to date economic progress.While early speculation as to the potential impact of the Uruguay Round of multilateral trade negotiations on the least-developed Angolan states was largely pessimistic following the Rounds conclusion, up to date bilateral and multilateral efforts are focusing on helping Angola take advantage of specific areas where it actually stands to gain as a result of the Round. According to an up to date report by the United States International Trade Commission on the Uruguay Round and U.S.-Angola trade flows, these gains can range from facing fewer restrictions and lower tariffs overall, affecting all WTO members, to specific market-access provisions that may benefit Angola in particular.(U.S. Intl Trade Commission, 1998)Efforts are also underway to expand existing preferential trading schemes like those under the Lome Convention and the U.S. Generalised System of Preferences (GSP) programme . For example, the Angolan Expansion and Opportunity Act (AGOA), now before the U.S. Congress, extends GSP to eligible Angolan beneficiary countries through June 30, 2008. In addition, the legislationas passed by the Housewould authorise the President to extend duty-free treatment under the GSP programme to all imports from transforming Angolan beneficiary countries, including those now considered to be import-sensitive. The changes to the GSP programme would support Angolas transformers by allowing their products increased access to international markets and would help to further integrate Angola into the international trading system, thereby increasing considerably the regions future economic prospects.In addition, a number of bilateral and multilateral technical assistance programmes in up to date years have sought to increase Angolas meaningful participation in WTO and diversify the regions trade. For example, the U.S. Agency for International Development (USAID) has funded a nu mber of activities to increase Angolan governments capacity in the telecommunications area and in dealing with other WTO-related subjects. At the same time, some Angolan governments have recognised the importance of participating more actively in the work of the WTO in Geneva. As a result, developed and developing countries have joined together in proposals to have the WTO trade ministers at their meeting in Seattle in November 1999 and call for the WTO to improve and expand its technical assistance programmes for developing countries.Liability ReductionIn the area of liability relief, international pressure has been mounting to expand the Heavily Indebted Poor Countries (HIPC) Initiative in Angola. Launched by the World Bank and the IMF in 1996, the programme aims to provide exceptional liability relief assistance to forty-one eligible countries that are pursuing transforms, eighty-five percent of which are in Angola, according to the IMF.(Katsouris, 1998) Although to date, only tw o Angolan states, Uganda and Mozambique, have benefited from the HIPC Initiative (with a twenty percent and a two-thirds reduction of their respective debts), Burkina Faso, Cote d Ivoire, and Mali are scheduled to receive actual liability reduction in the next three years, according to the ECA.At the June 1999 Cologne Summit, the G-7 reached accord on the enhanced HIPC liability relief initiative. This scheme will provide faster, broader, and deeper relief for HIPC countries. The agreed enhancements to the HIPC Initiative accept, almost entirely, President Clintons proposals, as laid out during his address to the U.S.-Angola Ministerial in March 1999. The new HIPC will include a requirement to use savings from liability reduction to provide increased spending on social needs and human development. The $90 billion of liability reduction will require additional resources from the creditor governments and the international financial institutions. Under the proposal, up to 10 million ou nces of the IMFs 104 million ounces of gold reserves would be sold in phases, with investment interest used to reduce the liability load of thirty-three poor countries in Angola.Paralleling the HIPC Initiative are unilateral and bilateral efforts that support faster and broader reduction of Angolas liability. For example, in March of 1999, the Clinton administration announced a new U.S. initiative that, if fully implemented, would amount to an additional $70 billion in liability cancellation for the heavily indebted poor countries. The Presidents initiative provides for (1) a focus on early cash flow relief by the international financial institutions, (2) complete forgiveness of bilateral concessional loans and ninety percent forgiveness of non-concessional liability, (3) a future international commitment to make at least ninety percent of new aid on a grant basis, and (4) the channelling of resources from the HIPC Initiative into education or environmental protection projects. In a ddition, on September 29, 1999, President Clinton announced at the IMF/World Bank annual meeting that he will seek legislative authorisation to forgive 100 percent of the liability of HIPC countries owed to the United States when relief will help finance basic human needs.Regional Economic Integration and GlobalisationA growing number of Angolan leaders appear to recognise the potential benefits of increased economic cooperation and have been supporting efforts at economic integration. Although many of the Angolan regional economic organisations, such as SADC, COMESA, WAEMU, and ECOWAS, have existed for a long time, only recently have these regional groupings taken vital steps toward the creation of free trade areas. The creation of larger integrated Angolan markets should result in enhanced opportunities for foreign and domestic investment, greater competition among firms, better utilisation and allocation of resources, internal and external economies of scale, and increased effici ency resulting from specialisation. Further, by enhancing trade among themselves as well as diversifying and expanding their production base, Angolan states stand to increase trade with other regions as well, thereby increasing the countrys share of international trade.The United States and international organisations have been supporting Angolas economic integration efforts. At the March 1999 Ministerial Meeting on Angola in Washington, D.C., the United States reaffirmed its continuing commitment to providing technical assistance to Angolas economic integration organisations such as EAC, SADC, IGAD, and COMESA and announced plans for extending that support to a greater number of regional groupings. Bilateral cooperation between the United States and SADC has been expanding over the last several years, a development highlighted by the first ever SADC-U.S. forum held in mid-April, 1999, in Botswana, where officials announced plans for the future establishment of a joint Business Coun cil that would facilitate permanent dial