E-business growth, or an aged alternative

A new report from the Gulf Co-operation Council's policy making Commercial Co-operation Council makes some bold claims for the future of e-business in the region-the value of e-commerce conducted in the Gulf is predicted to double over the next three years, to be worth $900 million per year by 2005.

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By  Mark Sutton Published  November 23, 2002

A new report from the Gulf Co-operation Council's policy making Commercial Co-operation Council makes some bold claims for the future of e-business in the region-the value of e-commerce conducted in the Gulf is predicted to double over the next three years, to be worth $900 million per year by 2005.

While this figure may not seem like that much, considering it includes both government and oil & gas business, it is certainly a lot more than many of us might have expected-but where is this e-business revolution?

Saudi Arabia accounts for the lion's share of the business, but what is most interesting is that this figure of $900 million is almost all business that is conducted through EDI, an exchange mechanism that has been around for over 15 years.

Be it international marketplaces or regional distributors communicating with local customers, they are almost all based on EDI, and many businesses give no indicator of going to the Internet instead.

While it is only natural that businesses go with a proven system, and with the solution that gives them access to the most partners and customers, the lack of Internet-based solutions is hampering the development of this sector in the region.

Many of the large online marketplaces have failed to return a profit and have struggled to understand the nature of their business, but by keeping to EDI, they will not be able to truly open up to all of the business opportunities in the region, that would be open with Internet based systems.

While EDI has its benefits, and Internet systems have many sticking points that need to be addressed at a GCC level, over-reliance on an ageing system will see the region stall on e-business.

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