Made up of seven countries (El Salvador, Costa Rica, Belize, Guatemala, Honduras, Nicaragua and Panama), the Central American territory has the size of Colombia, a population equivalent to that of Spain, and the density of France. Each country is different, in fact, diversity is one of the leading regional differentiators. However, the health crisis generated by the Covid-19 pandemic has generated similar negative consequences in all of them, delaying their development.
Economic recovery will partially depend on the connectivity and digital transformation plan each country defines, develops and, ultimately, implements.
The impact of Covid-19
Before the pandemic, most Central American countries experienced slow economic growth with timid advances in digital infrastructure and a notable lag in all regional indicators. Simultaneously, outdated ICT regulatory frameworks and weak institutions – with regards to the governance of connectivity development – have impacted digital progress.
While it is true that all countries in Central America have made efforts to help people be able to conduct business, communicate, receive government services and get entertainment in the context of the pandemic, a large part of the region’s population was left without significant access to digital technology.
As a result, many could not take part in virtual education schemes or continue with their work. This situation was particularly severe in rural areas, where the deep digital divide translates directly into poverty.
Recommendations
First of all, Central America must set connectivity goals that are consistent with the digital policies of the public and productive sectors of each country. Second, the development of infrastructure must be promoted by regulatory frameworks that are tailored to each market’s reality. This is the only way legal stability for investments, and access to services for the population, can be guaranteed. To achieve these ambitious objectives, it will be pivotal to strengthen the institutional capabilities of the ICT sector.
With the creation of a Digital Government Agency, Costa Rica took a step in the right direction; this was the result of public policy seeking to embed the country in a path of digital change. The agenda of the agency is ambitious, including everything from the development of digital infrastructure to the generation of conditions that guarantee greater digital inclusion across the population.
However, it must be considered that the economic situation faced by countries in the region is now critical, aggravated by the pandemic and the passage of two hurricanes through Central America in 2020. Together, these events have caused enormous human, economic and social losses. In this context, there are not many options for sustaining connectivity and digital development, leading nations to resort to international cooperation or development banks, and the reactivation of Universal Access Funds to support the financing of initiatives.
Venturing into either of these financing models will require, in all countries, support at the highest political level, as well as coordination with relevant stakeholders across the digital ecosystem. Moreover, their success goes beyond the deployment of networks: strategies for generating capabilities, promoting relevant content and digital empowerment are needed.
Looking at the future
Investment in these areas should be a priority for all governments, and Central American countries are no exception. The future is today, and there is no more time to waste. The new post-Covid-19 reality requires innovative public policy frameworks and regional cooperation. While there are some signs that this collaboration is taking shape, 2021 should consolidate a more modern way of looking at digital and connectivity policies in Central America.
