NEWSLETTER

The government is doing a great effort to increase the IT adoption at individual level. In the10th Plan, many of the initiatives target the basic issue of increasing the computer literacy across the population in general. Some examples of the objective set in this plan are the increase the number of houses with computer to 10.5 % (family computer initiative), increase the number of computer per 100 people to 5.9, to bring IT to all social classes (PUBLINET centres) and the connection of all educational institutes to Internet.

These initiatives are getting good results for the population in general. But, what is the IT situation in the business-to-business segment?

The first part presented in the previous Newsletter analyzed the IT sector from the export point of view. This second part wants to offer a review of the sector from an on-shore business perspective.

The domestic market: the “local user” perspective.

The analysis of Tunisia’s IT sector from the business point of view brings one critical issue on the table: IT is not “another” export-driven sector of the economy. IT plays a critical role in the efficient development of almost every activity of the economy.

Compare to developed countries, Tunisia’s IT sector is very underdeveloped. In 2002, the market was valued at 200 MTND, and there were an estimated 210 000 PCs in the country. Although the branch as experienced a growth between 10 and 15% per annum, the level of IT usage still remains low compared to developed countries. In average, Tunisian consumption of IT per capita is 50 times inferior to European consumption and 100 times inferior to American consumption.⁽¹⁾

There is no much detailed data available about the scope and quality of the services supplied by the IT sector. This lack of information makes difficult the diagnostic of the current situation of the sector. However, some clues can be gathered by analyzing the overall characteristic of the local demand and supply of IT products and services.

The demand side. The local demand of IT product and services comes mainly from the public sector and government institutions.

The central government and public companies account for more than 80% of the total turnover of the sector. Much of the IT demand is related to the e-government initiative, initially promoted in the 9th Plan (1996-2001) and which aims at modernising the overall performance of their institutes and integrating different organisations into an information network.

In addition to be the biggest buyer of IT products and services, the government is also the main promoter of the private sector IT consumption. The mise a niveau program has been an important engine in promoting the adoption of IT technologies. Through this program, the government subsidizes software and associated services (intangible investments) up to 70% and hardware up to 25%. In spite of this financial help, there are still many managers that still do not consider IT investment of value for their companies.

One example of this adverse attitude toward IT is the tendency of Tunisian companies to buy computers and peripherals in stead of specialized software. Investment in specialised software such as supply chain management, workflow and ERP is very low, accounting for only 6 % of total revenue of the sector. Most software acquisitions include standard, non critical applications such as HR management, financial packaged solutions and back office applications. These kinds of applications have a limited added value to the overall performance of a company. In term of IT services, the situation is similar. Local companies usually acquire standard services usually associated to the applications, such as:

1. advice on purchasing of hardware and software (local network design, software assessment, server configuration, etc)



2. adaptation and implementation of software applications (installation, integration with existing application, training, migration of existing data, etc)