Chapter 8 Conclusion and Suggestions
8.2 Suggestions
Does Nicaragua have the resources to implement Internet Plus in tourism industry? After the analysis of the data collected in this research, I have come to the conclusion that Nicaragua actually has not the resources to implement such technologies immediately, but with the improvement of basic telecommunication infrastructure, increasing level of high education in the population, providing advanced technical training among others will help Nicaragua for the successful implementation of these technologies in tourism industry. Following are some suggestions on how to solve the problems facing by Nicaragua that this research has gathered by the analysis of the data implemented in this study:
1. Make effective use of Big Data and Nicaragua’s natural resources to meet tourists’
needs
In order to increase the diversity of tourism products and innovation, the image of tourism products should be sold with local characteristics, the Government needs to identify Nicaragua tourism image’s competitive advantages and distinguishes it from products from neighboring countries, as well as positioning Nicaragua’s country brand by emphasizing its features through a marketing mix campaign. According to Dr. Carolin Lusby, an Assistant Professor at Florida International University, said in a press interview about the weakness of Nicaragua’s tourism, “the weakness is due to the lack of a right marketing, in addition to not defining its tourism offer, tourism in Nicaragua is a great strength that has not fully developed because of the weakness in its marketing, something that can be affecting the amount of people who want to visit this country, by specifically ignoring what is offered”. A marketing mix campaign should be carried out through the use of Big Data, this data can be collected and analyzed by INTUR, Big Data would help to better know the tourist profile coming to Nicaragua, what their preferences are, why they come to the
country, where they go, how they spend their money, thus provide a better service and increase their expenditures.
2. Improving broadband penetration
In this digital era, where every industry is being revolutionized by the Internet and becoming more productive, Nicaragua needs to be aware of the new technologies around the world, although the Government of Nicaragua is expanding the network infrastructure and installing new Internet connections in urban and rural zones, but the use of the Internet should be focus on improving the educational quality of the country and productivity purposes.
3. Increasing digital literacy and awareness
Low level of digital literacy is preventing many users from exploring the benefits of the Internet technologies. According to a research by GSMA, the two biggest barriers to internet adoption in Nicaragua, are lack of locally relevant content and the lack of digital literacy and skills, these both can be affecting the user’s behavior when using Internet technologies, when there is a low level of digital literacy, the users simply cannot understand the positive benefits the Internet brings, thus the Government of Nicaragua should provide digital education aim at increasing literacy for the proper use of digital technologies, so that the population can have better knowledge of information technologies and communications and take advantage of it for the education and productivity of the country. By providing training and support for the people to increase their digital skills, the government can also encourage, train and provide financial support to SMEs for the use of new technologies as well as promoting local tech innovations and start-ups.
4. Reducing high handset and Internet taxation
Nicaragua has the highest handset tax in Central America, which means many users cannot afford these services. Nicaragua is a low-income country with a GDP per capita of US$2,026 in 2014, the consumer not only needs to pay a Selective Consumption Tax but also 15 percent of handset tax for buying a mobile phone, that means these devices are unaffordable for those at the bottom of the pyramid. By reducing or eliminating taxes to make mobile devices more affordable for everyone, the government should establish strategic alliance with mobile operators to provide better services and low pricing plans.
5. Reducing investment barriers and open up market for competition
In a study by GSMA, shows the Herfindahl-Hirschman Index (HHI) for the competition in Latin America mobile markets, this index range from 0 to 1.0 where a high number means a single monopolistic provider. Nicaragua actually has two mobile operators and its HHI is 0.5, the same number of mobile operators in country as Haiti and Jamaica, while Brazil is the most competitive market in the region with seven mobile operators. Lack of market competition has led to high prices;
the government should reduce investment barriers and provide attractive incentives for investors in order to provide fair prices and different options to the customers.
6. Reducing financing constraints faced by SMEs
A major problem the SMEs in Nicaragua are facing is the constraints in obtaining loans to incorporate new technologies, only 15 percent of microenterprises and 37 percent of small companies invest in new technologies, compared to 77 percent in medium-sized enterprises and 87 percent in large companies. The lack of adequate financial access seems to be one of the problems that most affect the companies in the country. In a research by COSEP, shows that 63 percent of microenterprises and 58 percent of small companies have faced difficulties in obtaining loans to incorporate technologies, compared to 48 percent and 33 percent for medium and large companies relatively. By reducing financing constraints, the government should provide adequate support to access finance for SMEs in order to improve their business environment, competitiveness and productivity. By establishing a national SME and Entrepreneurship Finance Fund, the government can provide low or zero-interest loans for enterprises encouraging them to adopt new technologies, improve business innovation and diversify their services for new markets.
7. Training skilled personnel
According to a research by Croes (2012), low expense tourism in Nicaragua could be correlated with low Human Development Index (HDI), a shortage of qualified personnel in the country is preventing from providing the tourists with higher value offerings. A reason for this is the lack of training for employees in the workplace and the low education level in the country have led to a poor service quality. Juan Sebastián Chamorro, Executive Director of the Nicaraguan Foundation for Economic and Social Development (FUNIDES, Spanish) said in a press interview,
“small companies in Nicaragua hardly invest in technology, the first reason is the level of education of the entrepreneur, at a lower level of education, the entrepreneur simply will not have the demand to invest in technology either because of lack of awareness or lack of understanding of the benefits of it. The second reason is investing in new technology involves heavy costs and uncertain benefits”.
People are not well informed about the benefits of the Internet and new technologies, as Alejandro Delgado, president of CONIMIPYME said “there are small companies that are afraid of using the Internet to promote their products for fear of being copied”. By increasing investment in education, training skilled personnel and increasing the awareness of new technologies and its benefits, people can use information technologies to upgrade their business and provide better services as well as increasing their level of education.
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