6 October, 2017. Samoa – A new report on Samoa’s e-commerce potential has identified several challenges to the ambitious and enthusiastic digital transformation vision being championed by government and the private sector involved in the submarine cable plans.
Government leaders have been overwhelmingly positive about the benefits the new cables will have for the country including how it will impact on local business. “The Tui-Samoa Cable will greatly help to improve the lives of ordinary Samoan people…[providing] local Samoan businesses the platform to promote their goods and services and compete in international markets”.”
However, a report presented at the UNCTAD Intergovernmental Group of Experts on E-Commerce and the Digital Economy, convening in Geneva, has shown that while progress has been made, there is much work still needed in different sectors and that improved infrastructure alone will not make Samoa e-commerce-ready.
The assessment points out that E-commerce cannot take off here as long as the majority of the population does not have a bank account or credit card and remains skeptical of mobile payment solutions.
“Samoans remain largely unbanked,” the report says, adding that only around half the adult population has a bank account or access to other formal services such as credit unions and microfinance.
And cultural beliefs in the value of cash and a general reluctance to trust mobile payments — only 3.7% of mobile phone owners have a mobile money account — are preventing online businesses such as Samoa market and Makeki Online from boosting sales despite increased traffic to their websites.
One of the reasons Samoans seem reluctant to trust online payments, the report says, is an incomplete and at times outdated legal framework.
The top concern, according to the assesement, is consumer protection online, particularly data protection and privacy, for which Samoa has no legislation.
The assessment calls for a thorough review of Samoa’s legal framework, despite being one of the most advanced in the region according to UNCTAD’s Cyberlaw Tracker.
Another challenge is the cost of transporting goods to and from Samoa.
By giving exporters direct access to potential clients around the globe and allowing Samoan consumers and businesses to find the best deals for what they import, e-commerce could help the country overcome its geographical disadvantages, the report says.
However, the cost of sending goods overseas takes a toll on profits and on customer’s wallets.
Air transport is the most expensive way to ship goods, yet because most goods Samoans buy and sell online are small parcels, Faleolo International Airport is currently the main entry and exit point.
Better port facilities and increased transportation options would make e-commerce less expensive, the assessment says, adding that the lack of a postal addressing system also limits the scope of e-commerce in Samoa.
(The usual directions of ‘Turn left by the white church, drive till you see a big mango tree, then go down that dirt road, and stop at the pink shop and the house is behind it…’ don’t work for mailing packages from overseas!)
According to the report, Government reforms have brought more competition and better regulation to the telecommunications sector, making mobile phones “an everyday reality for most of the population. But Internet connections are still unreliable and expensive, keeping more than two thirds of the population offline.”
But it’s not just about getting more Samoans connected online, and building trust in online transactions. The report says that if people (and businesses) are uninformed of the opportunities e-commerce offers and lack the necessary technological skills, online sales will continue to drag.
“The lack of understanding and awareness of what e-commerce is and how to benefit from it has been a common thread throughout the assessment period,” the report says, adding that assistance could focus on small and medium businesses owned by women since current e-commerce facilities are more accessible by well-established male-owned businesses.
The ability to make trade more inclusive and offer opportunities to women and youth — two segments of the population often left out — is what makes e-commerce a game changer, says Mere Falemaka, Permanent Representative of the Pacific Islands Forum to the World Trade Organization.
“UNCTAD’s e-trade readiness assessments are a first step for Pacific Island countries to develop a coherent national e-commerce policy,” Ms. Falemaka says.
The report is positive about Samoa’s national commitment to addressing these challenges, concluding that “the government of Samoa is committed to take advantage of e-commerce. And with the right vision and concerted efforts to remove persistent bottlenecks, Samoa could become an e-commerce hub for the region.”
The Samoa Rapid e-Trade Readiness Assessment, was funded by the Enhanced Integrated Framework, a multi-donor programme for least developed countries. The Assessment is the third such report done by the United Nations Conference on Trade and Development.(UNCTAD)