While recent price reductions are much needed and welcome, the nation needs to take larger strides towards closing the digital divide in order to keep pace with global, and regional, innovations.
MFR Graphics
The Solih Administration on 27 May announced new prices for broadband internet services, as part of the key pledges of the Maldivian Democratic Party (MDP) manifesto. Although delivery on the pledge was repeatedly delayed over the past two and half years, after immense pressure from the public, the newly appointed Minister of Environment, Climate Change and Technology Aminath Shauna punctuated this as the beginning of a new ‘Digital Maldives.’
For the country to truly achieve the benefits of decentralisation, use of technology in order to overcome geographic limitations is seen as an important element — one with much crucial emphasis, especially due to the COVID-19 pandemic.
In a series of articles with a ‘Digital Maldives’ focus, MFR will, throughout June, address the use of technology and innovation in small and medium enterprises, government services, health services, education & training, and entertainment to deliver tangible benefits to the nation — from communities and individuals to institutions, regulators, organisations and more.
As per an April 2021 World Bank report, the Maldives is ahead of other South Asian nations in terms of digital connectivity, with 63 percent of the population using the internet. Mobile phone usage is also relatively higher compared to other upper middle income small island developing states.
However, there is a significant digital divide in the Maldives, with only 51 percent of households in the atolls having access to broadband internet services compared to a whopping 83 percent in the Greater Malé Area. Internet speeds are also up to two times faster in the capital when compared to the atolls.
As highlighted by the World Bank, internet prices and speed have been major constraints for service delivery by businesses and individuals in the Maldives, with price of a monthly fixed broadband internet connection costing 3.1 percent of the country's’ per capita income. This is higher than the UN recommended target of two percent and much higher than most other South Asian countries. With the recent price reductions announced by the administration on the 27 May 2021, it will still be at 2.6 percent of per capital income. Download speed in the Maldives as of January 2021 was 24.5 megabits per second — compared to 33.5 for Bangladesh, and 54.7 for India.
The World Bank also highlights that competitive constraints in the telecom industry in the Maldives may have led to lack of affordable services. The Maldives scored 8.3 out of 28 on the ‘competitive framework’ pillar in the 2020 International Telecommunication Union's Information Communications Technology (ICT) Regulatory Tracker, much lower than other South Asian neighbours.
On the macro front, the ICT sector in the Maldives employs a mere 1.8 percent of all workers, excluding employment in the resorts. The ICT sector contributes only 3.4 percent to the nation's GDP, indicating under-utilisation of technology in business and government.
Another important factor is the limited digital literacy among the Maldives' workforce. With only five percent of tertiary graduates pursuing science, technology, engineering, and mathematics (STEM) programs, Maldives lags behind when compared to other small island developing states. According to the Global Partnership for Education (GPE), the most pressing challenge for the Maldives in the education system is the need to improve the quality of education, with poor quality and performance of teachers as the major factor contributing to the country’s weak learning outcomes in schools. In 2017, approximately 20 percent of Maldivian students in Grade 4 and 33 percent in Grade 7 failed to achieve a minimum score of 40 percent in Mathematics.
The World Bank recommends a set of measures that could reduce the digital divide and move towards a much needed digital transformation. One that starts with a holistic view of policy interventions — a set of policies that would strengthen institutional, policy, legal and regulatory frameworks, so that the country can move towards digital development and improved human resource capacity.
It also recommends establishing a long-term road map and an institutional governance framework that clearly defines the roles and responsibilities of all government and state level institutions, the private sector and all other relevant stakeholders.
This should also incorporate the legal and regulatory requirements that are needed to achieve the digital transformation, especially those required for financial technologies (Fintech) and digital identification. With the recent enactment of the Payment Systems Act, there are additional complementing laws that are required, including laws on data protection, electronic transactions and cyber security.
Incorporating ICT and digital skills in the national curriculum, and ensuring continued programs on basic digital literacy in schools will be a vital investment, and a key step, for the future digital economy.
