New Zealand trailing in world e-commerce race

By GREG ANSLEY

CANBERRA - An Australian study has added weight to claims that Government regulation is holding back the development of electronic business in New Zealand.

The study, by Australia's National Office for the Information Economy, says New Zealand trails the world's e-business leaders and is well behind Australia's global No 2 ranking.

It attributes this to Australia having a regulatory regime far better geared to encouraging e-business.

The study was based on a survey of e-business readiness in 60 countries by the United States-based Economist Intelligence Unit (EIU).

When that survey first came out it was challenged by Information Technology Minister Paul Swain, who said he would write to the report's editor seeking clarification.

But the information has been embraced by the Australian agency and used to support the case for low regulation but high priority for IT policies.

Analyst Joseph Di Gregorio said the agency had not made its own comparative analysis of transtasman regulation, although several benchmark studies had yet to be done.

Instead, the study quoted the EIU's belief that active government support was needed to promote an entrepreneurial e-business culture.

It said a prerequisite to affordable internet access was a competitive telecoms market.

For countries where a monopoly provider had traditionally dominated the market, e-business could not take flight unless the Government liberalised the sector.

A regulatory regime geared to e-business was the main factor that put Australia - in second spot - ahead of its neighbour New Zealand, which ranked only 20th.

The rankings were based on factors from telecoms infrastructure to the security of credit card transactions and literacy levels.

The world leaders are the United States, Australia, Britain, Canada, Norway, Sweden, Singapore, Finland, Denmark, Netherlands, Switzerland, Germany and Hong Kong.

New Zealand's ranking is three places lower than last year, and at the bottom of the contenders - having satisfactory IT infrastructures and good business environments, but lacking essential elements for e-business.

This group is led by Ireland, then France, Austria, Taiwan, Japan and Belgium. New Zealand is ahead of South Korea, Italy, Israel, Spain and Portugal.

The study comes amid predictions that global e-commerce revenue will go from $US54 billion ($132.7 billion) in 1999 to $US607 billion in two years.

Last year in Australia, $A5.1 billion ($6.4 billion) in sales was generated over the internet by 38,000 companies.

The report predicts that e-commerce will boost Australia's economic growth by 2.9 per cent by 2016.

New Zealand's sliding e-business performance was recorded despite high use of computers and the internet. New Zealand was ahead of Australia and fifth in the world for the percentage of people over 16 with internet access.