Africa and other non-industrialized regions are facing a competitive disadvantage as businesses around the world increasingly use the Internet, according to a United Nations report published Thursday.

But mobile telephone use is surging and playing a significant role in development, adds the Information Economy Report 2005, released by the United Nations Conference on Trade and Development (UNCTAD).

The Internet is a tool that can help firms find contracts and clients in ways never before possible, but only 3.1 percent of Africans had access to the Internet in 2004, and less than 1 percent had access to the broadband connections that are most useful for business and related financial activities, says the report.

Although use in South-East Asia and other developing regions is higher, even in China -- the world's second-largest Internet market-- there is an Internet penetration rate of only 7.2 percent inhabitants.

The gap in business use between the developed and non-developed world appears to be vast, the report states. Some 89 percent of enterprises in European Union nations are connected to the Internet.

Figures are scarce for developing countries, but while countries like Singapore (76 percent) have high rates of business use, connections in Mauritius (5 percent) and Thailand (9 percent) are much lower. Many developing countries cannot even provide statistics on the topic.

A shortage of data and comparable statistics on e-business has to be overcome if governments are to close the gap between richer and poorer nations, the report states.

Improving the production of data and statistics on information and communications technology is important not only for analysing trends and monitoring impact, but for designing government policies and strategies, it adds.

One technological breakthrough that has had more rapid and positive results for developing countries is the mobile telephone, says the report. Developing countries have now overtaken industrialized nations in the absolute number of cellular phone subscribers, and growth has been surging.

According to the report, among all forms of information and communication technology, mobile telephones appear to have the most significant impact on development in poorer nations. The number of mobile subscribers in Africa increased from 15 million in 2000 to over 80 million in 2004, a rise of 433 percent.

Source: Xinhua