TRADITIONAL opinion making on economic activity in the country has a rule, the more the better, a major relic of planned economy where everything that is placed on the ground is an additional input in driving towards economic success.

That isn’t forcibly true in a competitive market economy, as here too many goods of the same type chase fewer buyers, or too many service providers chasing fewer users. E-commerce faces this scenario.

That is why acclamations on strides that the telecommunications sector is making, while true and exciting, have a way to leave what they at times say is a dry taste in the mouth. 

Yes, no doubt that strides are being made in basic infrastructure to support the physical delivery of items purchased in electronic commerce, but that is all there is to it. A total of 146 apps were registered or obtained the regulatory go-ahead to engage in service provision.

Those in charge were enthusiastic with how infrastructure to promote high-speed internet services and robust payment systems was being put up, on a daily basis. While the regulator sees these initiatives as key prerequisites for a thriving e-commerce sector, observers worry that there is more of offer than demand in a vast number of commercial subsectors. 

There are many glittering shop frames and new ones coming up, such that one wonders if they really notice numerous customers, etc.

The regulator says that the policy and regulatory frameworks have addressed most enabling factors for e-commerce, which is evidently the case. What the report did not say was just how much business is being done, though admittedly that ought to come under Trade and Industry rather than Communications. 

There are auxiliary reports though, like the chipped in datum that the residential address innovation is helping the postal corporation inch up business, faster than the various other apps.

Posts appear to be able to cultivate an image of reliability as a public agency where complaints can be made, a weakness that started to be noticed with a range of supposed e-commerce service providers. 

Surprisingly, the regulator has scarcely ever released data on e-commerce non-deliveries after payment was issued in due and proper form. It is vital that a digital system is developed showing which vehicle was tasked with transporting purchased goods, where other ID data will be available as well.

Registering apps for e-commerce is indeed the easier part, while there is the issue of rising demand to relate to the higher number of business seekers. This relates to other spheres of economy like new investments or levels of profit being made in various spheres, and thus disposable incomes at household levels. Things aren’t bad in this sphere either, as readiness to provide e-commerce utility shows considerable layouts, usable surpluses.

While there is indeed a rosy future that is emerging for e-commerce owing to rising aggregate incomes (as different perhaps from strict average personal incomes) all isn’t just a highway to success. There are two categories of those who make investments, those who actually wish to make a living from such investment on the basis of a modicum of savings (depending on the social stratum presumed, evidently), and those who wish to increase their savings fairly quickly. 

E-commerce investors are likely to be similarly divided, those who need quick profits and those who can sit out grey days until the market really improves.

Traditionally there have been slumps in the market a few years after too many investors take to a certain sphere of investments. The last time a big slump was noticed globally was the ‘dot-com’ stock exchange collapse at the turn of the century, which sort of mirrors the current spate of registrations for e-commerce apps, by thousands of people. 

Chances are that they are mainly those who seek a business opening rather than placing their fortunes or savings into a business so as to make a living, as with rentals.

The point at issue is that the country is experiencing technical modernization at a rather fast pace, while its overall structure in production and commercial activities remains fairly traditional. There is a modicum of success noticed at different periods, where new avenues of commerce spring up in tandem with market movements, here tied up especially with public sector consumption patterns. 

Those linked with the government and hundreds of public companies are easily the most important segment of the economy, with the private sector living on its wings, as its prosperity is tied more with transactions conducted with public agencies than within the private sector as such.

In the past decade the most visible collapse of an investment penchant was the building of hotels and guest houses, as well as flourishing catering and restaurant businesses, to which were attached astronomical land values on prime plots – or indeed anywhere in key urban centres. 

The curtain fell with the blink of an eyelid if one could say so, as within six months government expenditure had shifted from 74 per cent recurrent and 26 per cent development (or capital) expenditure, to 61 recurrent and 39 development expenditure. Most front space catering had to be redesigned; new investments go to shop frames, not hotels.

The difference with the collapse in 2016 is that catering or hospitality is tied up with rental space use, which can be shifted or converted to other uses. 

E-commerce applications are a local version of the ‘dot-com’ scenario, as its presence is on the internet and tied up with public demand for certain types of services. Still, unlike the catering or hospitality businesses of old, e-commerce apps don’t seem to be a means of life for those who front them; hoping to make some money, not rely on them.