Monday, April 09, 2007


World Economic Forum has launched this year's Global Information Technology Report's Networked Readiness Index measuring the degree of preparation of a country to participate in and benefit from ICT. This year's rankings have topped Denmark. Among top ten, we can also find Singapore, Finland, Iceland, the United States and Sweden.

In the aspect of environmental component, Denmark peforms very well. It is known for an excellent legal framework in the world multiplied by a strong and respectable protection of intelectual property rights. The excellence of legal environment is well codified in some featured facts. For example, it takes an average of 5 days to start a business in 3 procedures at zero income per capita cost. The extent of the quality of legal environment is well seen in the ease of enforcing commercial contracts. In average, with 15 procedures, 190 days and 6,5 percent of debt cost, Denmark is qualified as the most business-friendly environment in the world in this respect with a little government-burdened regulation. A little bit worrying is the extent of taxation with a confiscatory 59 percent marginal income tax and 28 percent tax rate on corporate income. Danish capital markets are sound, broadly availible and well accessed. Refering to IMD's World Competitiveness Yearbook, Denmark is known for the world's lowest penetration rate of insider trading on capital markets.

In the field of technology, Denmark steadily deregulated and liberalized the sector of telecommunications by promoting the establishment of a well-functioning competition-based market for the supply of electronic communications and services. Though the local competition is not highly intense according, tech markets are deeply diversified as all forms of broadband internet ("high speed") access packages are availible in every municipality, predominantly using DSL. After liberalizing the telecom market, charge fees are among the lowest and therefore most competitive in the world with an emphasis on connection charge. Danish hardware design and manufacturing industry is globally well-regarded. Over 85 percent of hardware products are exported. The success of this industry is an outcome of a small and medium enterprises' partnership with academic researchers in producing diverse leading-edge products. In education, ICT is pushed beyond internet access ample toward ICT training. Denmark reached 5th place in the area of quality of the education system. Internet school access is well enhanced and highly innovative as it enables to obtain IT driver's license online. By and large, Denmark is a world leader in developing and innovating digital training, teaching and education. What gives the value of the miracle of Danish hardware design, ICT usage and innovative capacity is a collaboration between industry and university, ranked among top ten in the world and so is the innovation capacity, showing top comparative priorities to support knowledge-based growth and benefits of entrepreneurship such as the promotion of entrepreneurship education and venture capital which is essential to boost entrepreneurial revival besides a friendly tax environment, liberalized and accessible product markets and unburdened labor market.

Denmark is a nice example to absorb the learnings and lessons from innovation and tech miracle. To launch a strong and powerful innovation wheel, we need market incentives upon good educated staff, ideas, powerful (preferably small) innovation (design, engineering) team, supply-chain innovation, and excellent marketing support because it's not technology that pursues growth, but free markets, openness, market-based incentives and especially decisions to launch the investment and predict the return. Above all, WEF's Global Information Technology Report is a vibrant opportunity to get aware of the advantages of ICT in the potentials of digital economy and e-commerce in the future.

Interesting further readings;
Swedish ICT miracle: Myth or Reality?
What's behind the Finnish ICT Miracle?
The ICT in Nordic Countries 1995-2000
The 2007 State New Economy Index; Benchmarking Economic Transformation in the States
European Innovation Scoreboard 2006

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