29 July 1999
Gallagher Estate, Midrand,
Ladies, Gentlemen Colleagues and Friends
I am happy to welcome you all here today. I would like to start by quoting to you the words of the President in his speech at the opening of Parliament
"The Government ... commits itself to work in a close partnership with all our people, inspired by the call - Faranani! - to ensure that we draw on the energy and genius of the nation to give birth to something that will surely be new, good and beautiful".
Today, we make a call to all South Africans to work in close partnership with us; to join us in the development of a policy that will lay the foundation for how we conduct our business in the future.
There is nobody here who will not have experienced the power and wondered at the potential of the new electronic commerce marketplace. The world we live in is experiencing a period of dynamic technological development. Traditional means of information, communication and computing are merging. Technologies of telephone, facsimile, television, audio-video discs and computers have brought about vast changes in our methods of personal communication. They have also transformed the organisation of the development , 'production and marketing of goods and services.
The Internet began as a source of information and communication, but developed into a medium of entertainment and education. And today, it has become an important medium for electronic commerce.
Increasingly businesses are using the Internet. Trade and commerce on the Internet are multiplying every year. In a just a few years, the Internet will be generating many hundreds of billions of rands in sales of goods and services throughout the world. The Internet is sometimes described as having created a borderless world. What are its implications for our sovereignty?
Yet we cannot move blindly into the dynamic world of of e-commerce without taking careful stock of its implications for our world, for our continent and for our country. We need to consider not only the opportunities, but the potential threats of electronic commerce. We need to look at its benefits for our economy and think carefully about its effects on our society.
In many countries, the electronic commerce debate has already begun. Leading international organisations such as the European Union, the Global Information Infrastructure Commission, the Organisation for Economic Co-operation and Development the World Trade Organisation and many more are exploring the potential and the consequences of electronic commerce.
Countries like Canada, the United States, Australia and Singapore have, amongst others, joined the debate.
But what does e-commerce mean in a developing country such as ours? What are its implications in a country in which so many of our people remain poor and disadvantaged?
E-commerce presents vital new opportunities for development. It will pave the way for the trade of indigenous products and services in a global marketplace. But it has special implications for South Africa and we need to look carefully at the opportunities, threats and challenges of e-commerce to our citizens.
In other words, we need to tailor-make our national policy on e-commerce and, drawing on the wisdom of the international debate, bring our own local situation into focus.
There are a variety of issues raised by e-commerce. Each is highlighted in the discussion paper and we hope you will bring your own views and thoughts to this important process.
The first is the question of building trust. This means that we must try to overcome the real and perceived risks of electronic commerce transactions - both to business and to consumers.
A number of issues arise.
There is for example the issue of the privacy of data collected during electronic transaction. Only the other day, a credit bureau accidentally published its full list on the open Internet. This has serious implications for personal privacy.
Security is a related issue. How do we know that the credit card number we use to purchase a book on the Internet will not be picked up by an unauthorised person and used for criminal purposes?
And what are the implications for our children?
For example, a survey by the US Federal Trade Commission indicated that, of the 212 children's web sites surveyed, almost ninety per cent collect personal information from children. Less than a quarter of these sites tell children to seek parental permission before providing information to the site.
Many Internet consumers are also deeply concerned about the security of payment systems, the reliability of businesses they cannot see or speak to and the lack of opportunity to take action when things go wrong. What are the implications of this for company law and for the law of contract for example?
Clearly, we need ground rules for buying and selling on the Internet. One of the ways of dealing with this will be to establish policy on cryptography; to establish policy on digital signatures to ensure the authenticity of the trading parties.
The second major area for investigation is that of establishing ground rules for operation. Here we must look at the common rules and practices of electronic based businesses internationally. If we are to promote the use of e-commerce, we must have a high degree of certainty and credibility attached to government policy or regulation.
How for example should we deal with questions of tax, customs, exchange control and trade in restricted goods? Can we realistically police taxes on goods purchased through the Internet?
And, if not should government look at new taxes or duties on electronic transmissions.
How too should we deal with the issue of intellectual copyright? Already, music can be downloaded of the Internet. What do our musicians feel about this? How can we protect the creations, the very livelihood of our artists, writers and music makers?
It also seems extremely unlikely that self-regulation will ensure the regulation of content and the prevention of fraud. There are no quick fixes. Xenophobia, violence, sedition, racism and pornography are alive and well on the Internet. Crime flourishes. Money crosses international boundaries.
Many argue strongly that there is a need for a code of conduct. Yet the development, monitoring and enforcement of that code cannot be the only solution. We need, in addition, to look at filtering technologies to protect ourselves and our children from offensive conduct.
All these questions need to be considered in the light of the work being conducted by the WTO in the field of e-commerce and we need to keep our channels of communication open in order to remain abreast of international developments.
The third area we must consider is that of enhancing infrastructure to promote an e-commerce environment. Here we need to think about how we can enhance information technology, telecommunications and financial service technologies and facilities and broaden access.
It is here that we become most particularly aware of the gulf between the developed world and the comparative lack of communications infrastructure in the developing world.
In South Africa, access to basic telephone services and computer and data services in remote rural areas is minimal. This means that large sections of our population are extremely unlikely to be able to access the new e-commerce marketplace in the short term.
We must take this into account as we continue to expand and upgrade our infrastructure. We cannot risk enlarging the gap between the information-poor and the information-rich. The policies we develop together on electronic commerce must take this into consideration. We must avoid inequality of access and ensure new possibilities for access for all. There can be no doubt that this requires regulatory measures to enlarge the concept of universal service.
We must ensure that Internet access does not remain the preserve of well-educated and privileged minorities. All citizens, regardless of geography, social or economic status must have access to public information networks and to the opportunity to use them effectively.
Another aspect we need to consider is a regulatory framework for the administration and management of domain names. The Reserve Bank has observed that electronic money products may require regulatory adjustment or intervention in order to limit risks to the national payment system and protect consumers.
The fourth area for discussion is that of maximising benefits. This topic focuses on the promotion of new business opportunities and facilitating the transaction of our economy.
The socio-economic opportunities and threats of e-commerce to South Africa are central to this topic. For example, electronic commerce offers new opportunities for marginalised people who were previously considered "unbankable". Through cheap infrastructure, this market could be dramatically expanded. On the other hand, if we do not take care, electronic commerce could widen the gap between the economic "haves" and the economic "have-nots".
How do we retain our competitive edge as a member of the global information society while, at the same time, responding to the national agenda? How do we ensure that small. business, informal traders and others have full access to the opportunities electronic commerce presents? How do we bridge the gap between our rural and urban areas, ensuring that computer literacy becomes part and parcel of the life of every South Africa.
All these and other questions are raised in the discussion paper we are launching today. The discussion paper contains no solutions, no prescriptions. It is a starting point; a launch pad towards the development of policy.
The South African government has come to recognise that we need to work towards a policy framework for electronic commerce. Government has, therefore, put forward some preliminary views on the subject.
There is no doubt that our efforts to extend the global information infrastructure must go hand in hand with the development of effective public policy on a wide range of issues.
We need, amongst other things, to create the necessary regulatory framework. We must promote socially and politically acceptable transformation towards a more information-based economy.
We have allowed some time for discussion and policy development in this crucial area. After these discussions, a Green Paper will be prepared for further consultation. Finally, a White Paper will emerge and, possibly, legislation.
There is an urgent need for public debate and dialogue on all these issues. So far, much of the debate has been driven by short-term business concerns. We need to broaden the discussion. We need to look at the challenges to employment, work and training. We need to consider the implications of the Information Society and what it means for the people of South Africa.
In short, if we are to avoid becoming victims of the future, we must become its architects.
I thank you all for coming here today and I ask you to join us in formulating an electronic commerce policy for South Africa.
We have set the scene with our discussion paper. We have provided a forum through our web page and the working groups we will set up today. In eighteen months from today, I hope we will have reached a policy on some of the issues that trouble us - and that we shall have travelled that journey together.
Let the debate begin!