The Internet and SMEs in Sub-Saharan African Countries

Abstract

The Internet is a global network of interconnected computers using multiple Internet protocols (IP). Increasingly, it is being used to enhance business operation by both small and medium-sized enterprises (SMEs) and large organizations around the world (Bunker and MacGregor, 2002; Turban, Lee, King, & Chung, Lee, J., King, D. & Chung 2004). One reason is that the Internet, when used to facilitate e-commerce and e-business, offers several benefits for the adopting organizations (Walczuch, den Braven, & Lundgren, 2000; Turban, et al, 2004). Such benefits include the following: 1) reducing distance barrier, 2) the development of new products and services, 3) opening direct links between customer and suppliers, and 4) enhancing communication efficiency. Our study of the relevant literature reveals that the diffusion of the Internet among businesses in Sub-Sahara Africa (SSA), including SMEs, is the lowest in the world at around 2% (ITU, 2005). A recent report shows that the whole of Africa has only 1% of the total international Internet bandwidth (UNCTAD, 2005). Thus, it is to be expected that businesses in the region with such poor connectivity and use will be unable to fully reap the benefits of the technology. Against such unfavorable situations, it would seem reasonable for research efforts to uncover why such unfavorable conditions prevail in the region. Sadly, very few studies exist that have investigated such issues. Little is known about the perceptions of the Internet or the factors inhibiting its spread among SMEs in SSA. To fill this gap in research, this article aims at adding to knowledge by presenting a summary of the findings of a preliminary study designed to investigate the perceptions of the Internet and the sorts of barriers facing SMEs in SSA desiring to adopt Internet in their operations or for commerce. The study used SMEs in Nigeria, a Sub-Saharan African country. The country was chosen for illustration proposes as it is the most populous country in Africa and has favorable indicators for the use of information and communication technologies (ICT) compared to other SSA countries (Ifinedo, 2005). Importantly, researchers, for example, Ojukwu (2006) have discussed use of ICT among Nigerian SMEs and it is hoped that this present effort will complement similar research efforts.