But they have to be balanced against globalization's no less brilliant and encouraging promises. As a matter of fact, for developing countries, the emergence of a global knowledge-based economy should in principle be good news. As the ratio between power and price of information equipment continues to rise, and as the cost of transferring information across borders keeps dropping, there are unprecedented opportunities to catch up. At the same time, the portability, flexibility and affordability of such technologies allow smaller players to become competitors worldwide. Responding effectively to these challenges will, as with past technological revolutions, require new attitudes and mindsets.
Investment remains a key to growth in the digital age, just as it was in the heyday of the railroad.
Because investing in phone lines, satellites or computers involves the new technology through the import of capital goods and licensing arrangements, technological catching-up requires increased foreign exchange earnings to pay for the needed imports. For all their potential, new technologies are not a fast track to economic prosperity for all but are an integral part of a global structure which remains heavily biased against the poor and underprivileged. Regional cooperation can be one way for developing countries to challenge those biases by establishing the larger markets needed to support their technological efforts. Such cooperation might also be most appropriate for establishing new financial arrangements that can match those available to high-tech companies in the developed countries. But in the end it is the advanced countries that need to rethink their approach to development in the digital age, facilitating access to technology and supporting it by providing greater market access and external resources to developing countries, including more effective development assistance and debt relief.