http://dailynews.yahoo.com/h/ap/20000822/tc/world_tech_economy_1.html

Tuesday August 22 10:00 AM ET

Many Nations Unready for High-Tech

By D. IAN HOPPER, Associated Press Writer

WASHINGTON (AP) - Many countries are a long way from having the infrastructure to support technology companies, and economic expansion will stagnate without necessary improvements, according to a report released Tuesday.

The report, prepared by officials responsible for worldwide Y2K readiness last year, rates 42 nations in the areas of connectivity, technological leadership, information security, worker training and business climate. Twenty-three, including China, Russia and South Africa, require substantial improvement in at least two areas before technology companies and governmental tech efforts can flourish.

``The networked world is under construction,'' said Bruce W. McConnell, head of McConnell International LLC, a technology consulting firm. ``Smart companies will get in on the ground floor, but they should wear hard hats. The foundations are still unfinished. Many countries have not yet created the conditions that permit full participation in the digital economy.''

McConnell and the firm's other owner, Roslyn Docktor, led the International Y2K Cooperation Center's global Y2K readiness effort.

Estonia and Taiwan have the best ratings among all countries. Estonia has a top rating in governmental leadership, worker training and business climate. Taiwan, known for its microprocessor industry, rates high in the same areas.

Central and Southern Europe - such as Bulgaria, the Czech Republic, Estonia, Italy and Hungary - are the best-rated regions in the report. All the nations have skilled and educated workers, legal protections and computer security laws that are more advanced than in many other regions. Also, the report said, governments there have taken action to promote high-tech business.

The Middle East and Africa have nearly universal infrastructure problems, according to the report. If government initiatives in Ghana take hold, the report says, the country's telecommunications industry may bloom. In 1994, Ghana was the first West African nation to be connected to the Internet. There are several cellular telephone operators and Internet providers in the nation, though very few residents have computers or Internet connections.

The report also shows how government regulations can slow high-tech development. While Saudi Arabia gained Internet access in 1994, the general population was not allowed access until January 1999. It wasn't until 1998 that laws allowed Egyptians to own a second phone line.

Despite their slow starts, the report notes that the high-tech business growth rates are high and some countries, such as South Africa, are spending up to seven percent of their gross domestic product to improve Internet connectivity and infrastructure.

Major world powers are still far behind in the high-tech industry, as well, according to the report. China has insufficient infrastructure and information security to support such businesses.

McConnell said China's low mark in information security is due to rampant piracy and a lack of sufficient intellectual property laws, a problem that plagues many nations.

Russia rates even lower, gaining only an ``average'' rating in worker training but low marks in the rest of the categories.

But McConnell said that even skilled workers are a dying commodity there, as they leave the country for high-tech jobs.

``The overall climate makes it difficult to retain people,'' he said. ``The general picture in Russia is that they have a lot of work to get ready to participate in the new economy.''

-- (AP@news.story), August 24, 2000