PHD Thesis Final

E-commerce and Economic Development
in Libya
A thesis submitted to the University of Wales Institute, Cardiff for

the degree of Doctor of Philosophy
Cardiff School of Management
Abdalla Hamed
April, 2009
I
DECLARATION
I hereby declare that this dissertation, submitted in partial fulfilment of the requirements for
the degree of Doctorate of Philosophy and entitled “E-commerce and Economic
Development in Libya” represents my own work and that, to the best of my knowledge and
belief, it contains no material previously published or written by another person.
Signed……………………………………….(Candidate)
Date…………………………………………..
STATEMENT 1
This thesis has not already been accepted in substance for any degree and is not being
concurrently submitted in candidature for any degree.
Date…………………………………………..
STATEMENT 2
I hereby give consent for my thesis, if accepted, to be available for photocopying and for
inter library-loan, and for the title and summary to be made available to outside
organizations
Date…………………………………………..
II
Acknowledgment
In the end of this research I would like to emphasize my appreciation to:
 My parents who support me financially and provided me the confidence

to finish this dissertation
 My supervisory team for guiding me through my journey
 People who agreed to be interviewed and who accepted to answer the

research questionnaire.
 Brother, sisters and friends who have been waiting for my work
achievements
To all, thank you very much.
III
Contents
Abstract ..................................................................................................................................................... XII

Abbreviations ...........................................................................................................................................XIII
Research outcomes...................................................................................................................................XVI
PhD Consortium........................................................................................................................................ XVI
Conferences papers ................................................................................................................................... XVI
Seminars.................................................................................................................................................... XVI
Business Seminar ...................................................................................................................................... XVI
Chapter one: Introduction

1.1 Background ............................................................................................................................................. 3
1.2 Economic development and e-commerce .............................................................................................. 3
1.3 Research problem ................................................................................................................................... 5
1.4 Aim and objectives .................................................................................................................................. 5
1.5 Research method ..................................................................................................................................... 6
1.6 Background of Libya .............................................................................................................................. 8
1.6.1 Geographical Location and Population ................................................................................................. 8
1.6.2 History of Libya .................................................................................................................................... 9
1.7 Structure of the thesis ........................................................................................................................... 11
Chapter two: Economic development

2.1 Introduction........................................................................................................................................... 18
2.2 Background of Economic Development .............................................................................................. 18
2.3 Classification of Countries ................................................................................................................... 19
2.4 Economic Development Measurements .............................................................................................. 20
2.5 Theories of Economic Development .................................................................................................... 23
2.5.1 The Linear stages ................................................................................................................................ 24
2.5.2 Structural Change Theory ................................................................................................................... 26
2.5.3 The International-Dependence Revolution.......................................................................................... 27
2.5.4 The Neo-Classical Counter-revolution................................................................................................ 28
2.6 Economic Development and Technology ............................................................................................ 29
2.7 Economic Development and ICT ......................................................................................................... 32
2.8 Economic Overview of Libya ............................................................................................................... 37
IV
2.8.1 Economy of the revolution:................................................................................................................. 37
2.8.2 The new economy approach................................................................................................................ 38
2.9 Summary................................................................................................................................................ 41
Chapter three: E-commerce

3.1 Introduction........................................................................................................................................... 47
3.2 Background ........................................................................................................................................... 47
3.2.1 Use of the Internet ............................................................................................................................... 47
3.2.2 Internet in developing countries .......................................................................................................... 48
3.2.3 Internet in Libya.................................................................................................................................. 50
3.3 E-commerce ........................................................................................................................................... 53
3.3.1 E-commerce categories ....................................................................................................................... 54
3.3.2 E-commerce in developing countries .................................................................................................. 57
3.3.3 E-commerce in Libya .......................................................................................................................... 60
3.4 E-government ........................................................................................................................................ 62
3.4.1 E-Government in developing countries ............................................................................................... 65
3.5 M-commerce......................................................................................................................................... 66
3.5.1 Mobile commerce in developing countries ......................................................................................... 68
3.6 Payment Methods.................................................................................................................................. 69
3.6.1 Payment in developing countries......................................................................................................... 71
3.7 Regulation and legislation .................................................................................................................... 73
3.8 E-commerce challenges......................................................................................................................... 74
3.9 Factors Influencing E-commerce Adoption ........................................................................................ 77
3.10 Summary.............................................................................................................................................. 81
Chapter four: Twoards a theoratical framework for E-commerce drivers and barriers
4.1 Introduction........................................................................................................................................... 87
4.2 Drivers and Barriers............................................................................................................................. 87
4.2.1 Cost ..................................................................................................................................................... 90
4.2.2 Payment Systems ................................................................................................................................ 92
4.2.3 Legislation and Regulation.................................................................................................................. 93
4.2.4 Infrastructure ....................................................................................................................................... 95
4.2.5 Culture and Religion ........................................................................................................................... 96
4.2.6 Government......................................................................................................................................... 97
4.2.7 Employment ........................................................................................................................................ 99
4.2.8 Competition....................................................................................................................................... 100
4.2.9 Traditional business .......................................................................................................................... 101
4.2.10 Economic Activities ........................................................................................................................ 102
4.3 The E-commerce Drivers and Barriers Model (1) ........................................................................... 104
4.5 Summary.............................................................................................................................................. 107
V
Chapter five: Research method
5.1 Introduction......................................................................................................................................... 111
5.2 Research Purpose................................................................................................................................ 112
5.3 Research Design .................................................................................................................................. 113
5.3.1 Qualitative and Quantitative Methods ........................................................................................... 115
5.4 The Adopted Research Methodology ................................................................................................ 117
5.5 Secondary Data ................................................................................................................................... 119
5.6 Primary Data ....................................................................................................................................... 123
5.6.1 Interview ........................................................................................................................................... 124
5.6.2 Questionnaire .................................................................................................................................... 133
5.7 Method of Data Analysis .................................................................................................................... 138
5.7.1 Qualitative Data Analysis.................................................................................................................. 139
5.7.2 Quantitative Data Analysis................................................................................................................ 141
5.8 Ethical Considerations........................................................................................................................ 142
5.9 Summary.............................................................................................................................................. 143
Chapter six: Findings

6.1 Introduction......................................................................................................................................... 147
6.2 E-commerce drivers and barriers...................................................................................................... 147
6.2.1 Competition....................................................................................................................................... 148
6.2.2 Cost ................................................................................................................................................... 156
6.2.3 Culture............................................................................................................................................... 164
6.2.4 Economic development ..................................................................................................................... 171
6.2.5 Employment ...................................................................................................................................... 176
6.2.6. Government...................................................................................................................................... 181
6.2.7 Infrastructure ..................................................................................................................................... 187
6.2.8 Legislation......................................................................................................................................... 194
6.2.9 Payment............................................................................................................................................. 200
6.2.10 Traditional business ........................................................................................................................ 207
6.2.11 Knowledge ...................................................................................................................................... 212
6.2.12 Security ........................................................................................................................................... 217
6.3 Pioneer Initiatives ............................................................................................................................... 219
6.4 Benefits of e-commerce to Libya........................................................................................................ 220
6.5 Other Comments ................................................................................................................................. 222
6.6 Summary.............................................................................................................................................. 222
Chapter seven: The three-quarter moon chapter

7.1 Introduction......................................................................................................................................... 233
VI
7.2 Drivers and barriers ........................................................................................................................... 233
7.3 The three-quarter moon model (specific to Libya) .......................................................................... 239
7.4 Action plan........................................................................................................................................... 242
7.4.1 Before e-commerce adoption ............................................................................................................ 242
7.4.2 During-adoption ................................................................................................................................ 246
7.4.3 After e-commerce adoption............................................................................................................... 249
7.5 The Three-Quarter Moon Model (General) ..................................................................................... 254
7.5.1 Capitalist approach............................................................................................................................ 255
7.5.2 Socialist approach ............................................................................................................................. 259
7.5.3 Technologically advanced countries ................................................................................................. 259
7.5.4 Deploying the Three Quarter Moon Model ....................................................................................... 261
7.5 Summary.............................................................................................................................................. 264
Chapter eight: Conclusion chapter

8.1 Introduction......................................................................................................................................... 270
8.2 Review of objectives ............................................................................................................................ 270
8.2.1 Reviewing the literature of Economic development ......................................................................... 270
8.2.2 Reviewing the literature of e-commerce ........................................................................................... 271
8.2.3Developing a theoretical framework to conceptualise e-commerce drivers and barriers ................... 272
8.2.4 Investigate practical drivers and barriers of E-Commerce and its impact on Libya’s economy ....... 273
8.2.5 Develop an implementation plan for e-commerce adoption in Libya ............................................... 279
8.2.7 Develop a model to assist in E-Commerce adoption in Libya and consider how the model can be
generalised for other developing countries ................................................................................................ 279
8.3 Contribution of the body of knowledge ............................................................................................. 281
8.3.1 Contribution to theory ....................................................................................................................... 281
8.3.2 Contribution to Practice .................................................................................................................... 287
8.4 Limitations of the research................................................................................................................. 288
8.5 Recommendations ............................................................................................................................... 289
8.6 Future Research .................................................................................................................................. 290
9.0 References............................................................................................................................................ 292
Appendices
10.1 Interviewees’ comments tables: ....................................................................................................... 318
10.1.1 Data gathered: Use of tables............................................................................................................ 318
10.1.2 Important: example of use of tables ................................................................................................ 320
10.1.3 Competition:.................................................................................................................................... 322
10.1.4 Cost: ................................................................................................................................................ 326
10.1.5 Culture and Religion: ...................................................................................................................... 329
10.1.6 Economic Development: ................................................................................................................. 335
10.1.7 Employment: ................................................................................................................................... 342
10.1.8 Government :................................................................................................................................... 345
VII
10.1.9 Infrastructure:.................................................................................................................................. 351
10.1.10 Knowledge: ................................................................................................................................... 358
10.1.11 Legislation:.................................................................................................................................... 362
10.1.12 Payment:........................................................................................................................................ 365
10.1.13 Security ......................................................................................................................................... 373
10.1.14 Traditional Business:..................................................................................................................... 375
10.2: Interview question .......................................................................................................................... 381
10.3 Questionnaires’ answers................................................................................................................... 385
10.4 Questionnaire questions ................................................................................................................... 393
10.5 Questionnaire questions linked to e-commerce issues ................................................................... 401
VIII
List of tables
2.1 Economic growth items ........................................................................................................................ 29

3.1 History of internet users ....................................................................................................................... 48
3.2 usage of internet in libya ...................................................................................................................... 51
3.3 charge of dial-up and ADSL in libya................................................................................................... 52
3.4 leasedline capacity and price................................................................................................................ 52
3.5 telephone line in libya ........................................................................................................................... 61
4.1 cost issues in literature.......................................................................................................................... 90
4.2 payment issues in literature ................................................................................................................. 92
4.3 ligislation and regulation issues in literature ...................................................................................... 93
4.4 infrastructure issues in literature ........................................................................................................ 95
4.5 culture and religion issues in literature............................................................................................... 96
4.6 government issues in literature ............................................................................................................ 98
4.7 employment issues in literature ........................................................................................................... 99
4.8 competition issues in literature .......................................................................................................... 100
4.9 traditional business issues in literature ............................................................................................. 101
4.10 economic activities issues in literature ............................................................................................ 102
5.1 Research method techniques and outcomes...................................................................................... 118
5.2 Interview questions linked to e-commerce issues ............................................................................. 119
5.3 list of organisation interviewed .......................................................................................................... 131
6.1 competition issues in Libya ................................................................................................................ 155
6.2 cost issues in Libya.............................................................................................................................. 162
6.3 benefit of E-commerce ........................................................................................................................ 167
6.4 culture issues in libya .......................................................................................................................... 169
6.5 economic development issues in libya ............................................................................................... 175
6.6 employment issues in Libya ............................................................................................................... 179
6.7 goverment issues in libya .................................................................................................................... 185
6.8 internet connection charges................................................................................................................ 188
6.9 comunications tools ............................................................................................................................. 190
6.10 infrastructure issues in libya ............................................................................................................ 192
6.11 ligislation issues in libya ................................................................................................................... 198
6.12 payment issues in libya ..................................................................................................................... 206
6.13 traditional business issues in findings ............................................................................................. 210
IX
6.14 Reasons of using E-commerce.......................................................................................................... 220
7.1 before-adoption issues to libya........................................................................................................... 245
7.2 During-adoption issues to libya ......................................................................................................... 248
7.3 after-adoption issues to libya ............................................................................................................. 250
7.4 before-adoption issues (general) ........................................................................................................ 256
7.5 During-adoption issues (general) ....................................................................................................... 257
7.6 after-adoption issues (general) ........................................................................................................... 258
10.0 List of organisation interviewed ...................................................................................................... 317
10.1 competition issues in findings........................................................................................................... 321
10.2 cost issues in findings ........................................................................................................................ 325
10.3 culture issues in findings................................................................................................................... 328
10.4 economic activities issues in findings ............................................................................................... 334
10.5 employment issues in findings.......................................................................................................... 341
10.6 goverment issues in findings............................................................................................................. 344
10.7 infrastructure issues in findings....................................................................................................... 350
10.8 knowledge issues in findings............................................................................................................. 357
10.9 ligislation issues in findings .............................................................................................................. 361
10.10 payment issues in findings .............................................................................................................. 364
10.11 securty issues in findings ................................................................................................................ 372
10.12 traditional business issues in findings ........................................................................................... 374
10.13 questionnaire questions and e-commerce issues........................................................................... 401
X
List of figures
2.1 economic development model based on it ........................................................................................... 36

3.1 internet usage 2007 ............................................................................................................................... 50
3.2 Factors of e-commerce adoption decision ........................................................................................... 79
4.1 e-commerce drivers and barriers (1)................................................................................................. 105
6.1 reduction of adminstration work ....................................................................................................... 179
6.2 Internet services providers ................................................................................................................. 190
6.3 E-commerce awarness ........................................................................................................................ 216
6.4 fear of securty...................................................................................................................................... 219
6.5 e-commerce drivers and barriers (2)................................................................................................. 226
7.1 The four e-commerce actors............................................................................................................... 241
7.2 the adoption stages .............................................................................................................................. 252
7.3 the three-quarter moon model (specific to libya) ............................................................................. 254
7.4 the three-quarter moon model (general) ........................................................................................... 260
7.5 the classification model ....................................................................................................................... 263
XI
Abstract
This thesis develops a conceptual framework of the drivers and barriers to e-commerce
adoption in developing countries such as Libya. One of the main drivers of economic
development is technology. Technology adoption usually results in rapid economic growth,
and rapid economic growth is usually accompanied by rapid structural change. It is now
widely accepted by policy makers that e-commerce is at the centre of an economic and
social transformation that is affecting all countries. E-commerce creates new economic and
social landscapes. E-commerce enables producers in developing-country to overcome
traditional business limitations.
The research process involves a mixed research approach. Firstly, 15 semi-structured

interviews were conducted involving decision makers, government officials, managers and
general employees regarding e-commerce and economic development in Libya. Secondly, a
questionnaire was distributed across a population of 150 Libyan Internet users on a face-
to-face basis.
There are many drivers and barriers to the adoption of e-commerce. Most issues
(competition, cost, employment, economic development, government, infrastructure,
legislation and regulation, payment system) could be drivers or barriers. These issues
created the theoretical framework. All issues were examined in Libya, the research findings
confirmed the effects of these issues on e-commerce adoption. Moreover, the research
findings resulted in an amended theoretical framework by introducing two new issues
(knowledge and security). Additionally, the literature on e-commerce drivers and barriers
issues has been expanded.
The thesis concludes with a plan of action to assist Libya’s government on e-commerce
adoption. The plan of action is driven by four main actors (Government, technologically
advanced countries, companies and e-commerce users). These four actors and the plan of
action comprise the three-quarter moon model that encourages the fourth actor (e-
commerce users) to complete the circle of adoption. The thesis concludes that the three-
quarter moon model can be generalized to other developing countries and proposes a
classification model for e-commerce adoption along with a formula of Internet
involvement. The classification model classifies countries according to their technological
advancement. The new classification groups countries into non-technologically advanced,
less-technologically advanced and technologically advanced.
XII
Abbreviations
3G Third Generation
ADSL Asymmetric Digital Subscriber Line
AR Al-Reiad Internet Café
ATM Automated Teller Machine
AW Al-Wesam Internet Cafe
B2B Business to Business
B2C Business to Consumer
BA Bader Al Hasse Group
C2C Consumer to Consumer
CBL Central Bank of Libya
CI Concord Investment
CPI Consumer Price Index
DSL Digital Subscriber Line
DVB-RCS Digital Video Podcasting- Return Channel by Satellite
E-commerce Electronic commerce
E-economy Electronic Economy
E-government Electronic Government
E-mail Electronic Mail
E-procurement Electronic Procurement
FDI Foreign Direct Investment
XIII
G2B/C Government to Business/ Consumer
G-8 Group of eight industrial countries
Gb Giga Bite
GDP Gross Domestic Product
GNI Gross National Income
HDI Human Development Index
ICT Information and communication technology
ISP Internet Service Provider
IT Information Technology
Kb Kilo bite
L.D Libyan Dinar
LCB Libyan Commercial Bank
LDCs Less Developed Countries
LIB Libyanna
LTT Libyan Telecommunication Technology
M-commerce Mobile Commerce
MEB Mobile Websites
MIDS Matrix Information and Directory Services
MOC Ministry of Commerce
NGO Non-Governmental Organisations
OC Oil Company
OCC Oil and Construction Company
XIV
OECD Organisation for Economic Cooperation and Development
OLPC One Laptop Per Child
OPEC Organisation of Petroleum Exporting Countries
OPTC Organisation of postal and telecommunication Company
PC Personal Computer
PPP Purchasing Power Parity
SMEs Small and Medium Enterprises
TFP Total Factor Productivity
TNC Transnational Corporation
U.K United Kingdom
U.S. United Sates of America
UN United Nation
UNCTAD United Nation Conference in Trade and Development
UNDP United Nation Development Program
WAP Wireless Application Protocol
Wi-Fi Wireless Fidelity
WIPO World Intellectual Property Organisation
WTO World Trade Organisation
XV
Research outcomes
PhD Consortium
 Hamed, A, (2006) E-commerce in developing countries, the destiny of 21st century,
UK Academy of Information Systems, PhD Consortium, Cheltenham.
Conferences papers
 Hamed, A, Cleary, P, Berger and H, Ball, D (2008). E-commerce as a tool for
economic development, IBIMA, Marrakech, Morocco.
 Hamed, A, Berger, H, Cleary, P, Ball, D (2008) E-commerce and economic

development, E-CASE, Bangkok, Thailand.
 Hamed, A, Berger H, Cleary P, Ball, D (2008), E-commerce drivers and barriers, A

new classification method in digital revolution, UKAIS, Bournemouth, UK
 Hamed, A, Berger H, Cleary P, Ball, D (2008), The three-quarter moon. A new

model for e-commerce adoption, IBIMA, Kuala Lumpur
 Hamed, A, Berger H, Cleary P, Ball, D (2008), Can e-commerce measure

globalisation?, IBIMA, Kuala Lumpur
 Hamed, A, Berger, H, Cleary, P, Ball, D (2009), Globalisation and e-commerce

issues. IBIMA, Cairo
Seminars
 E-commerce in Libya, (2007) Al-Aser University, Tripoli, Libya
 E-commerce and Economy, (2006) CRM Research, UWIC
 E-commerce in Developing Countries, (2007) UWIC research committee
Business Seminar
 Key-note Speaker (2008) Doing Business in Libya, IE Singapore, Singapore
XVI
Chapter One
Introduction
1
1.1 Background ............................................................................................................................................. 3

1.2 Economic development and e-commerce .............................................................................................. 3
1.3 Research problem ................................................................................................................................... 5
1.4 Aim and objectives .................................................................................................................................. 5
1.5 Research method ..................................................................................................................................... 6
1.6 Background of Libya .............................................................................................................................. 8
1.6.1 Geographical Location and Population ................................................................................................. 8
1.6.2 History of Libya .................................................................................................................................... 9
1.7 Structure of the thesis ........................................................................................................................... 11
2
1.1 Background
This chapter summarises the research in this thesis and provides an overview of the
adoption of Internet technology tools and e-commerce in the economy of developing
countries, in particular Libya.
1.2 Economic development and e-commerce
The study of economic development is one of the newest, most exciting, and most
challenging branches of the broader disciplines of economics and political economies
(Meier and Rauch, 2005). Economic development must deal with the economic, social,
political and institutional mechanisms, both public and private, necessary to bring about
rapid and large scale improvement in the standard of living for the masses of poverty-
stricken, malnourished and illiterate people of Africa, Asia, and Latin America (Todaro,
1999).
One of the main drivers for economic development that has become apparent over recent
years is technology. Technology is not something that just happens to economies, it is a
process that countries need to consciously and actively promote and nurture (James. 1999;
Todaro, 1999). It is now widely accepted that information and communications
technologies (ICT) and e-commerce are at the centre of an economic and social
transformation that is affecting all countries (Chan and Lee, 2001; Hammond, 2001;
OECD, 2003).
3
The Third World has a well-recognised e-commerce and marketing potential. A significant
proportion of the Third World is already partially developed and a significant proportion of
the population has a demographic profile similar to that of the developed economies (Mann,
2000). It is generally believed that e-commerce enables developing country producers to
overcome traditional limitations associated with restricted access to information, high
market-entry costs, and isolation from potential markets (April and Cradock, 2000; Cohen,
et al., 2000; Maitland 2001).
The majority of developing countries face limitations on the development of their electronic
economy (e-economy) stemming largely from low income levels, low literacy rates, lack of
payment systems that can support online transactions, and cultural resistance to online trade
(UNCTAD, 2003). Developing countries need to take into consideration that building
telecommunications infrastructure is costly. In many cases, countries will need inflows of
Foreign Direct Investment (FDI) to improve domestic infrastructure (Jenkins and Thomas,
2002; UNCTAD, 2003). The revolution of e-commerce presents micro- and macro-
economic challenges, not only for organisations, but also for governments (Callioni, 2004).
Organisations that are going to adopt e-commerce need to consider restructuring their entire
business and create new strategies. They also need to implement new management
processes, change their business culture, follow different procedures for managing their
employees and build a well-structured and secure payment system (Well, 2004).
4
1.3 Research problem
Most developing consumer markets face severe limitations in terms of connectivity, ability
to pay, deliveries, willingness to make purchases online, ownership of credit cards, access
to other means of payment for online purchases and accessibility in terms of physical
deliveries (Straub, 2003). Some countries have invested heavily in Internet infrastructure
and have still failed to gain significant benefit, whereas other countries, such as India and
China, have benefited significantly.
This research will attempt to investigate the reason for this lack of benefit by identifying
the drivers and barriers for e-commerce adoption in developing countries, such as Libya.
This study is significant in that previous studies have, to the best knowledge of the
researcher, not yet been undertaken in Libya. Consequently, the study is important because
it throws light on the difficulty of using e-commerce and establishes why e-commerce
adoption is risky. Further, a model will be proposed that may help such countries to adopt
e-commerce.
1.4 Aim and objectives
This research will aim to answer the following questions:
What are the drivers and barriers that developing countries, such as Libya, face when
adopting e-commerce?
5
Can a plan of action and a model be developed the purpose of which would be to assist
Libya in adopting e-commerce?
Can the proposed plan of action and a model of adoption be generalised to be used by other
developing countries?
In order to answer these questions, the following objectives are thus formulated:
1. Critically review the literature of economic development and other related
subjects.
2. Critically review the literature of e-commerce in general and developing
countries in particular and other related subjects.
3. Develop a theoretical framework to conceptualise e-commerce drivers and
barriers.
4. Investigate practical drivers and barriers to e-commerce in Libya and the impact
of e-commerce activities on the Libyan economy.
5. Develop an implementation plan for e-commerce adoption in Libya.
6. Develop a model to assist e-commerce adoption in Libya and consider how the
model can be generalised for other developing countries.
1.5 Research method
The generation of data and information relating to the research topic is explained and
rationalised according to the research questions. The purpose behind this research is to
6
ascertain the effect of using e-commerce in the economic development of developing
countries such as Libya, where very few or no earlier studies have been conducted. The
research process is described in terms of a critical analysis of relevant research approaches.
The researcher assumed the role of an objective analyst, making a detached interpretation
of those data that have been collected in an apparently value-free manner (Gill and
Johnson, 1997). This was aimed at observing social reality in the context of examining the
potential of e-commerce within the Libyan economy. The researcher adopted a mixed
research approach (Saunders et al., 2003, Collis and Hussey, 2003; Johnson and
Christensen, 2004). Firstly, 15 semi-structured interviews (Robson, 2000, Burms, 2000)
were conducted involving decision makers, government officials, managers and general
employees regarding e-commerce and economic development in Libya. A combination of
tape recording and note taking was utilised during interview sessions to maximise the
validity of data collected aimed at minimising the weaknesses of both methods (Stewart
and Cash, 2006). Secondly, a questionnaire (Bell, 2001) was distributed across a
population of 150 Libyan Internet users on a face-to-face basis. This was aimed at
understanding the barriers experienced and anticipate future potential barriers. Pilot testing
was carried out for both the interview and questionnaire designs in terms of their structure
and substance. Lastly, the researcher undertook direct observation (Gill and Johnson, 1997)
of Libyan Internet users in order to recognise the social and/or human difficulties
experienced whilst engaging in basic e-commerce activities.
7
Additionally, QSR NUD*IST Vivo (NVivo), a qualitative software product, was utilised to
store and analyse the range of qualitative data collected (Myers 1997; Yin 2003). Data
analysis concerned applying ‘open coding’ that involved analysis of the content where data
were analysed and categorised into themes. Further investigation was required to establish
how the identified themes might inter-relate and link into sub-categories (Orlikowski 1993).
This is commonly known as axial coding and was used to uncover the relationships within
the categories until saturation occurred. Microsoft Excel was used to accommodate and
analyse data collated for quantitative purposes.
1.6 Background of Libya
1.6.1 Geographical Location and Population

Libya is the fourth largest country in Africa with an area of approximately 1,774,440 sq.
km, three times the surface area of France, seven times the size of the United Kingdom and
one-sixth larger than Alaska. The country is bounded by the Mediterranean Sea to the
north, Egypt and Sudan to the east, by Niger, Chad and Sudan to the south and by Algeria
and Tunisia to the west. However, over 90 percent of the land is desert or semi-desert, and
the country climate is affected by the Mediterranean Sea to the north and the Sahara to the
south (Terterov and Wallace. 2002; infoplease, 2005; The information department of the
Great Jamahiriya, 2006).
According to Terterov and Wallace (2002), the Libyan population is estimated to be 5.5
million, including numerous foreign residents, and is said to be growing at a rate of 3.5
8
percent, one of the highest population growth rates in the world. The population is young
(almost 50 per cent are under 20 years old) and 86 per cent urban - one of the highest
urbanisation rates in the world. Additionally, most of the population are educated and a
number of highly-qualified people were counted in the country. According to the
Information Department of Great Jamahiriya (2006), the country has now one of the highest
literacy rates in Africa. Some 97 percent of the adult population is literate. Public education
in Libya is free and compulsory for children ages 6 to 15. Arabic is the language of
instruction.
1.6.2 History of Libya

The roots of human settlement in Libya go back to the prehistoric period of the Stone Age.
It starts around 10,000 BC to 2000 BC This period had left evidence of human settlement in
Libya through a wealth of paintings and engravings left on stones inside mountain caves
that are generally located in the southern part of Libya. For most of their history, the people
of Libya have been subjected to varying degrees of foreign control, mostly from
Mediterranean empires; Libya was first colonised in the 12th century BC. The Phoenicians,
Carthaginians, Greeks, Romans, Spaniards, Vandals and Byzantines ruled all or parts of
Libya. Although the Greeks and Romans left impressive ruins at Cyrene, Leptis Magna and
Sabratha, little else remains today to testify to the presence of these ancient cultures.
Muslim Arabs conquered Libya in the seventh century AD as they proceeded to conquer all
of North Africa and the Iberian Peninsula concurrent with the spread of Islam. In the
9
following centuries, most of the indigenous peoples adopted Islam and the Arabic language
and culture. The Italo-Turkish War, which began in 1911, resulted in Italy's annexation of
Libya. After years of resistance the country became an Italian colony. In 1934, Italy
adopted the name "Libya" (used by the Greeks for all of North Africa, except Egypt) as the
official name of the colony, which consisted of the provinces of Cyrenaica, Tripolitania,
and Fezzan (Terterov and Wallace, 2002; Country Review, 2006; The General People
Committee for Tourism, 2006; The information department for the Great Jamahiriya,
2006)).
Following World War II, British and French forces occupied the area. From 1943 to 1951,
Tripolitania and Cyrenaica were under British administration, while the French controlled
Fezzan. On Nov. 21, 1949, the United Nations General Assembly passed a resolution
stating that Libya should become independent before January. 1, 1952. When Libya
declared its independence on December 24, 1951, it was the first country to achieve
independence through the United Nations. (Terterov and Wallace, 2002; The Library of
Congress, 2006).
A new era in the history of Libya began on September 1, 1969, when a Colonel Qaddafi
and a group of young army officers overthrew the royal government and established a
republic under the name Libyan Arab Republic. In 1976, Libya's leader, Muammar al-
Qaddafi, introduced a plan to reorganise the Libyan state. The plan essentially ensured that
the country would be run by a new representative body called the General People's
10
Congress, or GPC (Terterov and Wallace, 2002; Country Review, 2007; The information
department of the Great Jamahiriya, 2006).
1.7 Structure of the thesis
This thesis consists of eight chapters. This chapter, an introductory chapter, outlines the
significance of the study, the problem to be investigated, research questions and objectives,
and background information about Libya and its history.
The literature consists of three chapters (Chapters two, three and four). The second chapter
reviews literature on economic development and evaluates economic development theory
and its effect on developing country economies. It analyses the effect of technology on
economic activities and evaluates the use of technology as a tool for developing the
economy.
The third chapter reviews and analyses the existing literature relevant to e-commerce and
the Internet. It looks at the events which have made e-commerce possible, and the
transformations it has undergone to date. It discusses briefly the latest technologies and the
way other countries managed to gain benefit of these new technologies.
11
The fourth chapter reviews literature on e-commerce drivers and barriers. It discusses the
drivers and barriers of e-commerce and the Internet in more detail based on previous
research conducted in other countries in the developed and developing world and critically
summarises the main drivers and barriers for developing countries such as Libya,
developing a theoretical framework to conceptualise e-commerce drivers and barriers
The fifth chapter discusses the research methodology utilised for the purposes of the
present study as well as describing the research instrument employed to generate the data
and information required. It shows the links between the theoretical framework and the
survey instrument used for collecting data and provides an explanation of the interview
structure.
The sixth chapter presents and analyses the findings of the primary data generated from
research interviews and the questionnaire and modifies the theoretical framework
developed in chapter four. The revised framework developed in this chapter confirms the
relevance of the issues identified in the literature review in the Libyan context and adds two
new issues previously unreported, i.e. knowledge and security.
The seventh chapter discusses the research findings and e-commerce development in the
light of the literature review (chapters two, three and four). It proposes a plan of action and
new model and strategy for Libya regarding the adoption of e-commerce. The proposed
12
model is generated from reviewing the literature of e-commerce, economic development
and the findings of the research chapter. Additionally, the chapter introduces a generalised
model for other developing countries along with a new measurement for the stage of e-
commerce adoption.
Chapter eighth provides a summary of the conclusions which have been drawn using the
available data and the analysis. It sets out the limitations of the research, recommendations
for the adoption of e-commerce for governments and companies and provides suggestions
for future research.
13
14
Chapter two
Economic development
15
2.1 Introduction........................................................................................................................................... 18
2.2 Background of Economic Development .............................................................................................. 18
2.3 Classification of Countries ................................................................................................................... 19
2.4 Economic Development Measurements .............................................................................................. 20
2.5 Theories of Economic Development .................................................................................................... 23
2.5.1 The Linear stages ................................................................................................................................ 24
2.5.2 Structural Change Theory ................................................................................................................... 26
2.5.3 The International-Dependence Revolution.......................................................................................... 27
2.5.4 The Neo-Classical Counter-revolution................................................................................................ 28
2.6 Economic Development and Technology ............................................................................................ 29
2.7 Economic Development and ICT ......................................................................................................... 32
2.8 Economic Overview of Libya ............................................................................................................... 37
2.8.1 ECONOMY OF THE REVOLUTION: .......................................................................................................... 37
2.8.2 The new economy approach................................................................................................................ 38
2.9 Summary................................................................................................................................................ 41
16
17
2.1 Introduction
A major goal for developing countries is economic development or economic growth.
However, the two terms are not identical. Growth may be necessary but not sufficient for
development. This chapter gives a brief background on economic development. It also
explains different methods of classifying countries according to United Nations and World
Bank criteria. Economic development is usually measured using Gross Domestic Product
(GDP), Human Development Index (HDI) and Purchasing Power Parity (PPP). These
methods are discussed in this chapter. This chapter discusses the different theories of
economic development and critically evaluates each of these theories and how they are
used. It also emphasises the use of technology and ICT in economics and explains how they
contribute to economic development, and provides a summary of what developing countries
should do in order to achieve economic development.
2.2 Background of Economic Development
challenging branches of the broader disciplines of economics and political economy.
Todaro (1999) argues that economic development is not the same as the economies of
advanced capitalist nations (modern neoclassical economies). Nor is it similar to the
economies of centralised socialist societies (Marxist or Command economies). He defined
it as:
It is nothing more or less than the economies of contemporary poor,

underdeveloped Third World nations whith varying ideological orientations,
18
diverse cultural background, and very complex yet similar economic

problems that usually demand new ideas and novel approaches
(Todaro1999, p7).
Todaro (1999) and others (e.g. Kodakanchi et al., 2006; Dada, 2006; Furuholt and
Kristiansen, 2007) stated that economic development must deal with social, political and
institutional mechanisms, both public and private, necessary to bring about rapid and large
scale improvements in the standard of living for the masses of poverty stricken
malnourished and illiterate people of Africa, Asia, and Latin America. Furthermore, Meier
and Rauch (2005) believe that the study of economic growth in less-developed countries is
not as advanced as had been previously supposed. He stated that researchers are still trying
to understand what causes the difference between a healthy less-developed country
economy that is growing rapidly and an unhealthy less-developed country economy that is
growing slowly or not at all.
2.3 Classification of Countries
The classification of development used by the World Bank divides countries into four
groups on the basis of income per capita according to countries’ Gross National Income
(GNI). These categories were roughly:
 Low-income countries ($1,000 or less),
 Lower-middle-income countries ($1001-$3000),
 Upper-middle-income countries ($3.000-$9,000),
 High-income countries ($9,000 or more).
19
Sometimes high-income countries are designated as developed countries or the North, and
the middle and low-income countries as developing, underdeveloped or less-developed
countries or the South (World Bank Report, 2002). Moreover, the 134 Asian, African, and
Latin American members of the UN Conference on Trade and Development (UNCTAD)
often are referred to as the Third World (UNCTAD, 2002).
In 1971, the United Nations designated 25 countries with a low per capita income, low
share of manufacturing in gross product, and low adult-literacy rates as least-developed.
Since then, the United Nations has added other criteria to this list of marginalised
economies, including low levels of human development, natural handicaps, and low
economic diversification (Simonis, 1991; Blackwell, 1986). Yet there is still a concern as to
how to categorise the following:
 The 26 economies in transition (East Central Europe and the former Soviet Union,
all low and middle-income countries except high-income Slovenia);
 The eight members of the Organisation of Petroleum Exporting Countries, or
OPEC;
 The 25 poorest countries, designated as least-developed countries;
 And 106 other developing countries (Nafziger, 2006).
2.4 Economic Development Measurements
Until recent years a country’s aggregate output, or GDP, was used almost exclusively as the
primary measure of economic development. Both comparative (i.e. between countries) and
20
over time, growth in GDP per capita was commonly used to describe changes in well-being
(Ayres and Macey, 2005). Recognising the inadequacy of this measure of well-being, the
United Nations began to devise and collect other macro-level quantitative measures of
health, education, employment and housing in addition to real income data in the mid-
1950s. More explicit attempts at capturing the level of human well-being were made by
Morris (1979) and more recently in the UN’s HDI (DasGupta, 1993). Development
indicators suggest pronounced regional differences. The countries of Latin America tend to
be high up in the category medium human development. The countries of Asia also tend to
be in the medium development classification but lower down the ranking than countries in
Latin America. The category of low human development is almost entirely made up of
countries from sub-Saharan Africa.
Measuring economic development is a difficult process. Existing attempts to assess
national development are still suffering from conceptual and measurement challenges. This
has led to a literature that is, in general, excessively focused on economic development
without connection to the capabilities of those institutions to expedite economic
development of citizens (Holmes and Gutiérrez de Piñeres, 2006). Overall growth rate is
another economic development measurement. Growth rates being measured in PPP, HDI,
and independent measures of inequality based on the preferences of decision and
policymakers. These different measures always tell different stories (Todaro, 1999). To
remedy the failure of GDP to capture purchasing power inequality and to allow cross-
country comparisons, PPP equivalents were constructed. However, growth rates based on a
constant American dollar (USD) values often mask the distribution of wealth. Growth rates
21
can increase dramatically but still fail to raise the overall well-being of the general
population of a country or region (Holmes and Gutiérrez de Piñeres, 2006; Ayres and
Macey, 2005). Other measures were constructed to address the fact that income alone is not
a sufficient measure of development. The physical quality of life index is a composite score
of life expectancy, infant mortality and literacy. The problem is that this measure reveals
more about the quantity as opposed to the quality of life. Anand and Sen (2000) claim that
it neglects other crucial factors, such as public care and social organisation, which also
contribute to well-being and freedom of individuals. However, a new method to measure
economic development and growth is necessary to overcome all the weaknesses identified
by the existing methods to give a better understanding of the real situation in different
countries in the world.
The global disparities in access to the Internet and other information and communication
technologies have led to a ‘digital divide’ between technological ‘have’ and ‘have-nots’
(United Nations, 2006; Furuholt and Kristiansen, 2007). The digital divide is a term often
used to describe disparities in opportunities to access the Internet between wealthy and poor
nations (Furuholt and Kristiansen, 2007) and can be categorised as global, regional or
national. At the national level, there is an urban-rural digital divide (Rao, 2005). This
division can be seen in developing countries, in particular those where a clear tendency of
increased concentration on information is seen to flow to urban and central areas (Wong,
and Seok Ling, 2001; Mwesige, 2004).
22
2.5 Theories of Economic Development
The new development economics has a relationship with the old growth economics of
classical economists (e.g. Smith, Malthus, Ricardo) a concern with the heavy variables of
capital population, and the objective of what Adam Smith termed the “progress of
opulence” in the progressive state. But the new development economists went beyond their
classical and neoclassical predecessors to consider the kind of policies that an active state
and international community could adopt to accelerate a country’s rate of development
(Meier and Rauch, 2005).
The post-World War II literature on economic development has been dominated by four
major and some times competing strands of thought; The linear stage of growth which
included Rostow’s stages of development; Theories and patterns of structural change; The
international dependence revolution and new classical, and free market counter-revolution
(Meier and Rauch, 2005). In addition, Todaro (1999) stated that, the emergence of a fifth
approach that has been witnessed - an approach called the new or endogenous theory of
economic growth. It was primarily an economic theory of development in which the right
quantity and mixture of saving, investment, and foreign aid were all that was necessary to
enable Third World nations to proceed along an economic growth path that historically had
been followed by the more developed countries (Meier and Rauch, 2005). Therefore major
strands in economic development literature were now being reviewed.
23
2.5.1 The Linear stages
When interest in the poor nations of the world really began economists were caught off
guard. They had the experience of the Marshall Plan under which a massive amount of U.S.
financial and technical assistance enabled the war-torn countries of Europe to rebuild and
modernise their economies in a matter of a few years (Todaro, 1999). The linear stage
approach was largely replaced in the 1970s by two competing economic schools of thought.
The first focused on theories and patterns of structural change, and used modern economic
theory and statistical analysis in an attempt to portray the internal process of structural
change that a typical developing country must undergo if it is to succeed in generating and
sustaining a process of rapid economic growth (Sato, 2002). The second, the international
dependence revolution, was more radical and political in orientation. It viewed
underdevelopment in terms of international and domestic power relationships, institutional
and structural economic rigidities, and the resulting proliferation of dual economies and
dual societies both within and among the nations of the world (Todaro, 1999; Mookherjee,
1999)
In Stages of Economic Growth (1962), Walter W. Rostow has set forth a new historical
synthesis about the beginning of modern economic growth (Nafziger, 2006). According to
the Rostow doctrine cited in Todaro (1999), the transition from underdevelopment to
development can be described in terms of a series of steps or stages through which all
countries must proceed. He argued that:
it is possible to identify all societies, in their economic dimensions, as lying

within one of five categories: the traditional society, the pre-conditions for
24
take-off into self-sustaining growth, the take-off, the drive to maturity and
the age of high mass consumption.
(Todaro, 1999, P 174).
Rostow’s precondition stage for sustained industrialisation includes radical change in three
non-industrial sectors:
 First, increased transport investment to enlarge the market and production
specialisation;
 Then a revolution in agriculture, so that a growing urban population can be fed;
 Finally, an expansion of imports, including capital, financed perhaps by exporting
some natural resources.
In fact Rostow and others defined the take-off stage in a way that the more the country
saves, the faster it could develop. Moreover this growth would then be self-sustaining. The
main obstacle to, or constraint on, development according to this theory, was the relatively
low level of new capital formation in most poor countries. If a country wanted to grow, and
if it could not generate saving and investment of national income, it could seek to fill this
saving gap through either foreign aid or private foreign investment (Thirwall, 1994;
Todaro, 1999; Well, 2005). Thus the capital constraint stage approach to growth and
development become rational and an opportunistic tool for justifying massive transfers of
capital and technological assistance from the developed to the less-developed nations.
Unfortunately, the tricks of development embodied in the theory of stages of growth did not
always work. The Marshall Plan according to Miler et al., (2003), worked for Europe
because the European countries receiving aid possessed the necessary structural,
institutional, and attitudinal conditions to convert new capital effectively into higher level
25
of output. However, at an even more fundamental level, the stage theory failed to take into
account the crucial fact that contemporary Third World nations are part of a highly
integrated and complex international system in which even the best and most intelligent
development strategies can be nullified by external forces beyond a country’s control.
2.5.2 Structural Change Theory
Structural change theory focused on the mechanisms by which underdeveloped economies
transform their domestic economic structures from a heavy emphasis on traditional
subsistence agriculture to a more modern, urbanised and more industry-diverse
manufacturing and service economy (Mookherjee, 1999; Todaro, 1999). There are two
models, the Lewis Model and structure change and patterns theory. These will be presented
in turn.
In the Lewis model, an underdeveloped economy consists of two sectors: a traditional
overpopulated rural subsistence sector and a high productivity modern urban industrial
sector into which labour from the subsistence sector is gradually transferred. Finally the
level of wages in the urban industrial sector is assumed to be constant and determined as a
given premium over a fixed average subsistence level of wages in the traditional
agricultural sector (Todaro, 1999; Gregor and Johnston, 2001).
The other structural theory is the structural change and patterns theory (Gregor and
Johnston, 2001). Structural change and patterns of development structural change involve
virtually all economic functions, including the transformation of production and change in
26
the composition of consumer demand, international trade, and resource use as well as
change in socioeconomic factors, such as urbanisation and the growth and distribution of a
country’s population. Empirical structural-change analysis emphasises both domestic and
international constraints on development. The optimistic analysts include economic
constraints, such as a country’s resource endowment, and its physical and population size
as well as institutional constraints such as government policies and objectives (Todaro,
1999; Gregor and Johnston, 2001).
2.5.3 The International-Dependence Revolution
During the 1970s, international-dependence models gained increasing support, especially
among Third World intellectuals, as a result of growing disenchantment with both
Rostow’s stages and structural-change models. Essentially, the international-dependence
model views Third World countries as beset by institutional, political, and economic
rigidities, both domestic and international, and caught up in a dependence and dominance
relationship with rich countries.
Achieving a better future will require a new development model, one that goes beyond the
conventional focus on free-market capitalism, entrepreneurship, and global trade expansion.
Traditional, top-down development directed by governments and financed by foreign aid be
inadequate, since this approach has a very mixed track record and declining support
(Todaro, 1999). The idea behind this new development model is that basic services should
generally be provided by businesses - sometimes directly and sometimes in partnership
with governments or networks of non-governmental organisations (NGOs). The right
27
strategies can enable the poor to become customers and pay for the services they receive,
services that will improve their quality of life and increase their productivity (Hammond,
2001; Sato, 2002).
2.5.4 The Neo-Classical Counter-revolution
Throughout much of the 1980s, a fourth approach prevailed, the neo-classical counter-
revolution in economic thought which emphasised the beneficial role of free markets, the
open economy and the privatisation of inefficient and wasteful public enterprises. Failure to
develop, according to this theory, is not due to exploitative external and internal forces as
expounded by dependency theories. Rather, it is primarily the result of government
intervention and regulation of the economy (Todaro, 1999). The neo-classicists contend
that slow or negative growth results from poor resource allocation from non-market prices
and excessive Less-Developed Countries (LDCs) state intervention. They argue that there
are items that effect economic growth such as promoting competitive free markets. Free
markets will result in encouraging international traders to contribute in a country economy
and will result in reducing production costs and lowering product prices. The following
items in Table 2.1 will spur increased efficiency and economic growth.
28
Table 2.1 Economic growth items (Nafziger, 2006; Sato, 2002)

Item
1 Promoting competitive free markets
2 Privatising public enterprises
3 Supporting exports and free international trade
4 Liberalising trade
5 Removing barriers to foreign investments
6 Rewarding domestic saving
7 Reducing government spending and monetary expansion
8 Removing regulations and price distortion in financial resource
Finally in the late 1980s and 1990s, a few neoclassical and institutional economists began
to develop the new growth theory. It attempts to modify an external traditional growth
theory in a way that helps explain why some countries develop rapidly while others
stagnate and why, even in a neoclassical world of private markets, government may still
have an important role to play in the development process (Todaro, 1999; Adelman, 1999).
2.6 Economic Development and Technology
The adoption of technology is not something that just happens to economies, it is a process
that countries need to consciously and actively promote and nurture, and for which certain
socioeconomic preconditions must be met, if the potential benefits of technological
knowledge are to be effectively achieved (James, 1999). Creating new technologies
requires investment. In the case of capital creation, someone must use resources that could
have been devoted to something else in order to create, refine and put into practice a
productive idea (Well, 2005). James (1999) stated that a more rapidly the technology is able
to be adopted and put to work in an economy, the more rapid will be the pace of economic
29
growth. Technology usually changes the way in which factors of production are combined
to produce output, thus affecting the process of economic growth (Well, 2005).
Thirlwall (1994), as well as others (Keng and Ali, 2001; Meier and Rauch, 2003; Well,
2005), believes that the larger the gap between a country’s technology, productivity and per
capita income on the one hand and the level of productivity in the advanced countries on
the other, the greater the scope for a poor country to absorb existing technology and to
catch up with richer countries as well as skipping over stages of domestic technological
development. Many countries have attempted to follow this diffusion path, at least
implicitly by hosting within their economies translational corporations, the major source of
cutting-edge knowledge, and yet they still have failed to become more developed, or either
their rates of economic growth and development have lagged behind other economies
which have not followed this strategy. The reason, as James (1999) stated, was that many
LDC economies to which Transnational Corporations (TNCs) have brought, sold, or
licensed technology have yet to create the requisite initial domestic technological culture
and the domestic capacity for technological autonomy that would permit them to capture
the benefit of tool and machine diffusion through learning and spread effects at the point of
production (James, 1999). Meier and Rauch (2005) argued that the actual technology in use
is thus circumscribed, first by the nature of world technology and then by the availability to
the country of known technology, and finally by the choice made among those available. If
the technology in use is thought to be inappropriate, it may be inappropriate because world
technology is inappropriate, or because an inappropriate subset is available to the country,
30
or because an inappropriate selection is made, or for some combination of those three
reasons (Meier and Rauch, 2005).
The successful introduction of technology into a domestic production process in any
country requires a domestic scientific establishment capable first of understanding,
processing and adopting foreign-produced technological knowledge to local conditions and
secondly recognising the potential and dangers of its own discoveries when applied to the
domestic economy (James, 1999). The relative importance of different factors contributing
to progress, and the speed of progress itself, will vary from country to country according to
its stage of development and a whole complex of social and economic forces (Thirlwall,
1994).
Nafziger (2006) argued that developing economies do not have a mobile and highly
educated labour force, commercial farmers, large numbers of responsive entrepreneurs, a
favourable climate for enterprise. Neither do they have a high level of technical knowledge,
local ownership of industry, heavy reliance on direct taxes for revenue, a large number of
export commodities, an average income substantially above subsistence, a well-developed
capital market, or a high saving rate. Therefore firms in developing countries have to think
of adopting one or more of several alternatives for obtaining new technology that may
yield a higher level of TFP (Total Factor Productivity). Meier and Rauch (2005) stated that
these alternatives are: the purchase of new equipment; direct foreign investment; the
purchase of technology licenses for domestic production of new products or the use of new
processes; the use of non-proprietary technology, including that obtained from purchasers
31
of exports; the acquisition of knowledge from returning nationals who have been educated
or have worked in industrial countries and from nationals who remain in industrial
countries; domestic research and development and efforts in reverse engineering.
Countries at different levels of technical learning use the same technology at widely
varying levels of efficiency. Technical knowledge is acquired only at a cost and is almost
always incomplete. Less-developed areas can almost never acquire technical knowledge in
its entirety, as blueprints, instructions, and technical assistance fail to include technology’s
implicit steps. Learning and acquiring technology does not result automatically from
buying, producing, selling, and using but requires an active search to evaluate current
routines for possible changes (Nafziger, 2006). The LCD firms and governments obtain
technical knowledge through transfer from abroad as well as internal innovation, adoption,
and modification.
2.7 Economic Development and ICT
It is now widely accepted by policy makers, enterprises and society at large that ICT is at
the centre of an economic and social transformation that is affecting all countries. ICT and
globalisation have combined to create a new economic and social landscape. As stated in
UNCTAD (2003), in the late 1990s the US economy was able to grow faster than at any
time. This combination of strong economic growth and low inflation has been linked to the
diffusion of new ICT (UNCTAD, 2003). The G-8 2000 report stated that ICT is fast
becoming a vital engine of growth for the world economy. A recent study by the
32
Organisation for Economic Cooperation and Development (OECD) (OECD, 2003)
analysed the contribution of ICT to economic growth, as well as the impact of ICT-using
and -producing sectors compared with that of non-ICT sectors on economic growth and
labour productivity. The result was fairly conclusive evidence that suggested that
investment in ICT made a significant contribution to economic growth in a number of
countries and also had a substantial positive impact on economic performance in other
countries. Hammond (2001) argued that advances in information and communication
technology did more than almost anything else to drive the last decade’s economic boom
and the integration of markets around the planet. The money spent on the digital
infrastructure that supports these burgeoning new services from the Internet servers to
fibre-optic networks has itself become a major engine of economic growth. Chan and Lee
(2001) add to the debate that the impact of investment in ICT on economic growth is
commonly regarded as a main driver of the new economy. Hawkins et al., (1998) believe
that ICT offers great benefits when ICT investment is combined with other organisational
assets, such as new strategies, new business processes, new organisational structures and
better worker skills.
There is now growing agreement about the positive contribution of ICT to productivity
growth. Through the application of ICT firms will become more competitive, new markets
will be accessed and new employment opportunities created. All of this will result in the
generation of wealth and sustainable economic growth (UNCTAD, 2003). The contribution
of ICT capital to output and labour productivity growth has been significant and rising in
relative terms.
33
Even so, the majority of developing countries face limitations on the development of their
economy stemming largely from low income levels, low literacy rates, lack of payment
systems that can support online transactions, and cultural resistance to online trade.
Developing countries need to take into consideration that building telecommunications
infrastructure is costly. In many cases, countries will need inflows of foreign direct
investment (FDI) to improve domestic infrastructure. This means that, in addition to
establishing a well-regulated telecommunications market, they also need to put in place
policies to ensure an appropriate investment climate for foreign service providers
(UNCTAD. 2003).
Edwards (2001) adds that in order for ICT investment to be fully effective, it has to take
advantage of network externalities. This requires a large enough number of people and
organisations to make the investment and become connected to the network. But, he
emphasises this is not enough. Network externalities are fully exploited only when those
using ICT communicate among themselves effectively, rapidly and efficiently. This, in
turn, requires that users share similar levels of technical, analytical, and “problem solving”
skills.
With ICT established, many researchers were concerned about the possibility of developing
countries catching up and gaining new solutions for rapid development. Sachs (2006),
Director of Columbia University’s Earth Institute as cited in the OECD report (OECD,
2002) contends:
34
“Today’s world is divided not by ideology but by technology”
The report explains that 15 percent of the world’s population are technological innovators;
about 50 percent with at least 2 percent of GDP being high-tech exports are technological
adopters. The rest of the world is technologically excluded. The report states that ICT, and
the Internet in particular, have created a bigger gap between countries (Hammond, 2001).
The Internet may be changing everything for those who use it, but it is doing nothing for
the 19 out of 20 people who still lack access. (Thirlwall, 1994).
According to Hawkins et al., (1999), firm-level (as opposed to government-level) evidence
confirms that ICT can have a strong impact on labour productivity. However, some
macroeconomic and microeconomic evidence from the United States suggests that the role
of ICT may have evolved and affected multi-factor productivity as well for three main
reasons. First, the 1990s saw various regulatory reforms which led to further liberalisation
of the telecommunication sector. This has helped to increase competition, reduce costs and
enhance innovation. Second, technological innovations in the 1990s, e.g. fibre optics, high-
capacity and high-speed hard disk drives, digital subscriber line (DSL) technologies and
satellite technologies, greatly increased the volume and capacity of communications. Third,
and probably most important, convergence of the ICT sectors accelerated in 1994-95 with
the emergence of the Internet’s key infrastructure applications, the World Wide Web and
the browser, which greatly expanded the potential of ICT. At relatively low cost, these
technologies linked the existing capital stock of computers and communications systems in
an open network that significantly increased their utility (Hawkins et al., 1998).
35
Kodakanchi et al., (2006) summarised the above discussion by introducing an economic
development model based on IT as shown in Figure 2.1 below. They argued that faster rates
of economic growth can be achieved using IT as the driving factor in the economic policies
of the world-wide economies. However, developing countries do not have enough
infrastructures to support the development of IT. Most commonly some of the major
concerns to the advent of IT in such countries are the inability to invest in the IT field due
to poor financial infrastructure and inadequate human power with the knowledge of IT.
Figure 2.1 Economic development model based on IT

Source: Kodakanchi et al., 2006
Higher productivity
Large foreign
investment
Information Faster
Government technology economic
policies growth
supporting IT
Social
awareness of IT
importance
Investment
Kodakanchi et al., (2006) explained that many multinational companies have recently been
investing their major capital in the IT field, especially in countries like India. A government
should facilitate such investments by making policies favourable to foreign investments and
inviting many foreign companies to invest in the IT field. But most of all a general
awareness among the peoples of a nation regarding the importance of IT is crucial.
Kodakanchi et al., (2006) stated that the knowledge of IT should be enforced at the
educational institutes and various other steps can be taken by the governments to nourish
36
the growth of IT awareness among the people. However, Kodakanchi et al., (2006) have
not raised the important issues of culture and customs in the adoption of ICT in most
developing countries. Neither have they raised many other aspects that deal with people’s
willingness to adopt such technology and the effect of international markets and
globalisation of that adoption.
2.8 Economic Overview of Libya
2.8.1 Economy of the revolution:

When Libya gained its independence in 1951, the economy was based mainly on
agriculture, which employed more than 70 percent of the labour force and contributed about
30 percent of the GDP. Before the discovery of oil and gas, Libya was one of the poorest
countries in the world. However, by 1961, substantial qualities of oil had been discovered
and greatly supported the country's social and economic development (Terterov and
Wallace, 2002). Consistent with Arab.net (2002), the discovery of oil in 1959 has
transformed Libya from a poor nation at the time of its independence, to a far more
prosperous one, ranking 12th among petroleum producers. Therefore, Libya's economy is
heavily dependent on the oil sector, which accounts for over 50 percent of GDP, about 95
percent of foreign exchange earnings, and 75 percent of government revenue. After the
revolution in 1969, the 1969 constitutional declaration vested sovereignty in the people.
The aim of the state was to realize socialism and to liberate the national economy from
foreign dependency (Wanees and Karlberg, 2007). A socialist approach was adopted in
Libya after Colonel Qadhafi’s revolution, a trinity of freedom, socialism, and unity,
depicting socialism as the solution to the economic problems of humankind. Libyan
socialism was doctrinal, as opposed to pragmatic, and highly nationalistic in a region where
socialism and nationalism often have been found together (Russell and Mustafa, 1999).
37
After the socialist approach was implemented, the public sector in Libya dominated
activities. In the most radical of the measures, all private property rights were eliminated in
March 1978 (Anderson, 1999). In later years, most private trading, retail and wholesale,
was abolished. The only type of private sector activity that the government did not actively
seek to eliminate was small service firms (mostly self employed), which were not viewed
as inherently exploitative (Hochman, 2006). The central bank's credit policy was supporting
the government's policy to minimize the effect of private business by limiting credit
availabilities to the private sector and directed it instead to the state entities. However,
private investment and ownership were encouraged in the agricultural sector. The last phase
of the socialist period was characterised by an intensive effort to build industrial capacity
targeting diversified processes. In 1988, Libya took some steps towards liberalisation with
greater scope allowed to private enterprise, small scale industries and agricultural business.
In September 1992, a privatization law was passed, but this initiative had no impact on the
structure of the economy’s revenues and caused a serious decline in the economic activity
(The economist, 2004). Now with a relatively small population, the substantial oil revenues
gave Libya one of the highest per capita GDPs (US$6,800 in 2005) in Africa (Country
Review, 2006). Libya has 100 billion barrels of proved oil reserves and around 40 trillion
cubic feet of gas reserves. The cost of recovering the oil is low and the country is well
located for exporting to Europe (National Oil Corporation, 2005).
2.8.2 The new economy approach

Economic conditions in Libya started to deteriorate in the mid-1980s with the fall of world
oil prices, and worsened in the 1990s as a result of United Nations-imposed economic
38
sanctions. Since the lifting of international sanctions in 2003 and 2004, Libya has decided
to undertake comprehensive structural reforms and accelerate its transition to a market
economy. However, the country still faces the formidable challenge of overcoming the long
legacy of centralised economic management, excessive reliance on the public sector, and
heavy dependence on oil (Country Review, 2006).
According to The Economist (2004), Libya’s economy remains largely state-controlled and
undiversified, with three-quarters of employment still in the public sector and private
investment accounting for only 2 percent of GDP. However, in 2003 GDP grew by 9.1
percent, a sharp increase from 3.3 percent in 2002, reflecting substantial increase in oil
production and oil export revenues (The Economist, 2004). Furthermore, in 2004,
economic performance was satisfactory with real GDP growing 4.6 percent, mainly driven
by higher oil prices and increased growth in the non-oil sector with strong performance in
construction, utilities and mining, boosted by increased government spending (The
Economist, 2004). In 2005, macroeconomic performance remained relatively strong with
real GDP registering a growth of 3.5 percent. Contrary to previous years however, growth
in 2005 was mainly driven by the non-oil sector growth, which increased from 4.1 percent
in 2004 to 4.6 percent as a result of continued increase in government expenditure (Country
Review, 2006). The International Monetary Fund (2005) stated that higher growth rates and
diversification of the Libyan economy could only be achieved through deregulation, a
significant scaling down of the dominant role of the public sector, and the development of
the private sector. They expressed strong interest in these findings and, together with World
Bank, will take a leading role in assisting Libya to reform the economy.
39
Libya is trying to attract international investors and develop non-oil businesses to drive
towards a sustainable economy. In fact Libya's relationship with the international
community has improved. To further integrate itself into the international society, Libya
has taken measures in economic and structural reforms including trade liberalisation,
allowing FDI in some sectors, the removal of customs duty exemptions enjoyed by public
enterprises, and the reduction in import tariff rates (Country review, 2006).
It can be argued that, Qaddafi's son, Saif al-Islam, was the driver of such changes. He
played an important role to bring the long-isolated country into the world economy (Reed,
2007b). He came to an agreement with Professor Michael Porter (Harvard business school
professor and the founder of Monitor Group), to develop methods to support Libya's private
sector (Reed, 2007). The Monitor Group has poured over the Libyan economy and mapped
out a strategy in a report for the next decade, focusing on energy, tourism, trade, and
construction (Reed, 2007b). The report resulted in the establishment of the Libyan
Economic Development Board (LEDB). The LEDB intends to diversify the economy away
from oil by promoting private business and entrepreneurship (Reed, 2007). The LEDB's
mandate is to clear away some of the obstacles to successful private businesses and thus
diversify the Libyan economy away from the state-controlled energy sector
(libyaninvestmnet.com, 2007).
Additionally, the Emerging Markets Monitor report (2007) indicated that Libya has
unveiled a plan to create a ‘Green Mountain Sustainable Development Area’. This
encompasses a national park, eco-friendly hotels, organic farms and the restoration of
40
archaeological sites in the mountainous region of Djebal Al-Akhdhar and a drive towards
attracting FDI into Libya and building up the tourist industry.
2.9 Summary
challenging branches of the economics and political economy. Economic development
deals with social, political and institutional mechanisms, both public and private, to bring
rapid and large scale improvements in the standard of living for people of Africa, Asia, and
Latin America.
Measuring economic development is a difficult process. Existing attempts to assess
national development are still suffering from conceptual and measurement challenges. This
has led to a literature that is, in general, excessively focused on economic development
without connection to the capabilities of those institutions to expedite economic
development of citizens. However, the global disparities in access to the Internet and other
ICTs have led to a ‘digital divide’ between wealthy and poor nations.
The post-World-War II literature on economic development has been dominated by four
major and sometimes competing strands of thought; The linear stage of growth which
includes Rostow’s Stages of Development; theories and patterns of structural change; the
international dependence revolution and new classical, and free market counter-revolution.
The emergence of a fifth approach (new or endogenous theory) has been witnessed. It was
41
primarily an economic theory of development in which the right quantity and mixture of
savings, investment, and foreign aid were all that was necessary to enable Third World
nations to proceed along an economic growth path that historically had been followed by
the more developed countries.
Technology adoption is not something that just happens to economies, it is a process that
countries need to consciously and actively promote and nurture. The more rapidly a
technology is able to be adopted to work in an economy, the more rapid will be the pace of
economic growth.
The successful introduction of technology into domestic production processes in any
country requires a domestic scientific establishment capable first of understanding,
processing and adopting foreign-produced technological knowledge to local conditions and
secondly recognising the potential and dangers of its own discoveries when applied to the
domestic economy. However, developing countries may face challenges in adopting
technologies because of the shortage of economic drivers such as a mobile and highly
educated labour force and a favourable climate for enterprise.
Kodakanchi et al., (2006) introduced an economic development model based on IT. They
argued that faster rates of economic growth can be achieved using IT as the driving factor
in the economic policies of the world-wide economies. However, developing countries do
not have appropriate infrastructure to support the development of IT. Most commonly,
some of the major concerns with the advent of IT in such countries are the inability to
42
invest in the IT field due to poor financial infrastructure and inadequate human power
having a knowledge of IT.
43
Chapter three: E-Commerce
44
Chapter three
E-commerce
45
3.1 Introduction........................................................................................................................................... 47
3.2 Background ........................................................................................................................................... 47
3.2.1 Use of the Internet ............................................................................................................................... 47
3.2.2 Internet in developing countries .......................................................................................................... 48
3.2.3 Internet in Libya.................................................................................................................................. 50
3.3 E-commerce ........................................................................................................................................... 53
3.3.1 E-commerce categories ....................................................................................................................... 54
3.3.2 E-commerce in developing countries .................................................................................................. 57
3.3.3 E-commerce in Libya .......................................................................................................................... 60
3.4 E-government ........................................................................................................................................ 62
3.4.1 E-Government in developing countries ............................................................................................... 65
3.5 M-commerce......................................................................................................................................... 66
3.5.1 Mobile commerce in developing countries ......................................................................................... 68
3.6 Payment Methods.................................................................................................................................. 69
3.6.1 Payment in developing countries......................................................................................................... 71
3.7 Regulation and legislation .................................................................................................................... 73
3.8 E-commerce challenges......................................................................................................................... 74
3.9 Factors Influencing E-commerce Adoption ........................................................................................ 77
3.10 Summary.............................................................................................................................................. 81
46
3.1 Introduction
This chapter discusses e-commerce in general and e-commerce in developing countries in
particular giving the example of Libya. Developing countries have a long way to go in
order to catch up with the developed countries, therefore the researcher critically evaluates
some of the issues that Libya is facing while adopting e-commerce. The chapter also
highlights the real situation of e-commerce-related issues in developing countries, such as
Payment systems and e-commerce regulation and legislation. Additionally, the chapter
summarizes internal and external factors that may affect e-commerce adoption in
developing countries
3.2 Background
In the developed world, the Internet has recently become a household domestic device and
its uses are becoming increasingly widespread, especially after the recent introduction of
broadband, which has greatly facilitated easy and fast access to the Internet. The Internet
has become immensely popular and a major channel for business. E-commerce has become
an important channel throughout the Internet community.
3.2.1 Use of the Internet
Internet technology has developed into a communication channel so large and powerful that
it cannot be ignored (Curtis and Cobham, 2008). Matrix Information and Directory Services
(MIDS) (1999) reported that there were 102 million people accessing the Internet world-
47
wide. This number had increased from the estimate of 57 million in January 1997,
representing a close-to 100 per cent increase in numbers of people accessing the Internet in
just a year and a half (Skok, 2000). The number of Internet users around the world
surpassed 340 million in 2002 (Tan and Ouyang, 2004). Reaching 591 million people at the
end of 2002 (UNCTAD, 2003) and is estimated to reach over 1,200 million worldwide by
the end of 2007 (Internet World State, 2007). The 2007 estimates are shown in Table 3.1.
Table 3.1 History of Internet users

Source: www.Internetworldstats.com, 2007
Usage
Population Internet Usage, % Population Usage %
growth
(2007) Est.) latest data (penetration of World
2000-2007
Africa 933,448,292 43,995,700 4.7 % 3.5 % 874.6 %

Asia 3,712,527,624 459,476,825 12.4 % 36.9 % 302.0 %
Europe 809,624,686 337,878,613 41.7 % 27.2% 221.5 %
Middle East 193,452,727 33,510,500 17.3 % 2.7 % 920.2 %
North
334,538,018 234,788,864 70.2 % 18.9% 117.2 %
America
Latin America 556,606,627 115,759,709 20.8 % 9.3 % 540.7 %
Oceania 34,468,443 19,039,390 55.2 % 1.5 % 149.9 %
World total 6,574,666,417 1,244,449,601 18.9 % 100.0 % 244.7 %
3.2.2 Internet in developing countries

Developing countries continue to experience faster growth in the number of Internet users.
At the end of 2002, developing countries had 32 per cent of the world’s Internet users, up
from 28 per cent in 2001. If current trends continue, Internet users in developing countries
could soon constitute 50 per cent of the world total.
48
However, it is in the concentration of Internet hosts for businesses relative to populations
that the difference between the developed and the developing world is most dramatic.
While in 2002 the number of Internet users per 10,000 people was 53 times larger in North
America than in Africa, in the same year the proportion between the numbers of Internet
hosts per 10,000 people living in those two regions was 984 to 1. In other words, the
relatively few people who use the Internet in developing countries compete among
themselves for access to a proportionally much smaller number of computers connected to
the Internet, and they have access to little locally-hosted Internet content (UNCTAD,
2003). One could argue that one of the crucial issues relating to the poor use of the Internet
in developing countries is the limitation of International bandwidth. International
bandwidth availability is especially important for developing countries because, given the
relative scarcity of locally-generated content, a large part of Internet traffic in developing
countries (between 70 and 80 percent by most estimates) tends to be international (Kamel,
2006). Over the last three years, the average African Internet user still enjoys about 20
times less capacity than the average European user, and 8.4 times less than a North
American one (UNCTAD, 2003).
49
Figure 3.1 Internet Usage 2007

Source: Internetworldstats.com, 2007
3.2.3 Internet in Libya
Internet access in Libya is becoming increasingly more popular, with the emergence of
Internet cafes, which have become one of the favourite pastimes of young Libyans. Most
companies now have accounts, and private access from home is becoming available. It is
anticipated that Libya will see a similar growth in cyber technology as seen in other North-
African markets (The Information Department of the Great Gamahiria, 2006; Doing
business and investment in Libya, 2005).
Most of Internet services in the country are delivered by the Libya Telecom and
Technology Company (LTT) - the only authorised Internet Service Provider in the country.
LTT connected to Canada through a satellite connection with a bandwidth of 5 MB and
50
also connected to Italy by a fibre optic cable with a capacity of 150 MB and a bandwidth of
45 MB (The Information Department of the Great Jamahiriya, 2006; LTT, 2006).
Accessing the Internet through a dial-up connection is considered to be one of the cheapest
and most popular means of connecting to the Internet (Young, 1999), the number of
subscribers to this service in Libya in 2006 was around 55,000 according to LTT internal
documents. This service is provided through access servers spread wide throughout most of
Libya's main cities (Tripoli, Musratah, Zawia, Khoms, Zletin, Benghazi, Surt, Houn, Sabha,
and Biniwaleed). In Tripoli the dial-up connection is good with rates of about 33 kbps, but
end users have to endure some problems due to the line conditions, mainly humidity and
cable disconnection. Large cities have adequate dial-up connection status, but in some
small towns, the poor connection of landline and ICT infrastructure prevents users from
using the Internet (Doing business and Investment in Libya, 2005; The Information
Department of the Great Jamahiriya, 2006). Table 4 shows the number of Internet users
between 1999 and 2001.
Table 3.2 Usage of Internet in Libya

Year Users
1999 7,000
2000 10,000
2001 20,000
Another service provided in the country is Asymmetric Digital Subscriber Line (ADSL).
The charge for dial-up and ADSL services in Libya are high compared to other service
providers. However, as summarised in Table 5.3, the cost of Internet connection is falling
dramatically for all services along with providing better quality and higher capacity. As an
51
example of the above, the dial-up cost is 0.4 Libyan Dinar (L.D) (£0.2) per hour in 2006
compared to 4 L.D (£2) in 1999 (LTT, 2006). The charge for ADSL in 2006 was 50 L.D
(£25) per month along with a one-time installation fee of 150 L.D (£75).
Table 3.3 Charge of Dial-up and ADSL

Source: LTT, 2006
Year Dial-up (L.D/ Hour) ADSL (L.D/ Month)
1999 4.0 -
2000 2.0 -
2001 1.5 -
2002 0.7 -
2003 0.7 -
2004 0.7 -
2005 0.7 50
2006 0.4 50
Furthermore, a leased-line service is also available in the country provided by LTT
Company. LTT internal documents acknowledge that the service provided could be
delivered using xDSL or ATM access. The LTT documents argued that using ATM could
enable organisations to use Voice and Video conferencing. Leased-line services are
available at different speeds ranging from 256 kbps up to 8Mbps see Table 3.4
Table 3.4 Leased Line Capacity and price, Source: LTT, 2006
Leased line
Year
64 kbs 128 kbs 256 kb 512 kb 1m 2M 4M 8M
1999 45,000 58800 - - - - - -
2000 13,200 25650 - - - - - -
2001 13,200 25650 - - - - - -
2002 12,000 29000 55,000 85,600 112,700 134,300 - -
2003 - 29000 55,000 85,600 112,700 134,300 - -
2004 - 29000 55,000 85,600 112,700 134,300 - -
2005 - 29000 55,000 85,600 112,700 134,300 260,000 -
2006 - - 9,000 16,800 32,400 60,000 110,000 200,000
52
The cost of leased-line, as with other costs, has fallen dramatically, e.g. 9000 L.D (£4,500)
in 2006 for 265 kb reduced from 55,000 L.D (£27,500) in 2002 as shown in Table 3.4.
In addition, Wireless Networking Services are available in the country from LTT. An LTT
internal document stated that highly secure wireless broadband-products are deployed in
Libya by public and private enterprises, government and educational institutions, and
Internet Service Providers (ISPs). Adding to above, DVB-RCS, a broadband satellite
solution, is available in the country provided by many companies offering one-way and
two-way connection. However, the only authorised company to provide the service is LTT.
Libya’s biggest demand is for one-way (receiving) services. Two-way (receiving and
sending) service requires a special usage permit. Only some government companies have
the permit to use two-way services. Oil companies need it for their oil fields that are located
in the desert to provide connectivity to their network. (The Information Department of the
Great Jamahiriya, 2006; LTT, 2006).
3.3 E-commerce overview
E-commerce is the concept of conducting trade and retail business online through the use of
secure websites. It constitutes the exchange of products and services between businesses,
groups and individuals (Davis, 2003). E-commerce technologies allow for instant access to
more data and opportunities than ever before because they extend across the globe and
reach people in almost every nation. With the immense networking and
telecommunications capabilities of e-commerce, most companies can be very profitable
53
ventures. The ability to promote and sell products and services online allows even the
smallest firms to profit with very little capital or overhead (Jasper, 2000).
With the latest computerisation and IT Internet technology, the future of international
business for all personal or commercial investment companies involves e-commerce and all
it has to offer. There are three main issues within e-commerce, including immediate access
to unlimited information, upgrading of daily business activities due to computerisation
technology and the opportunities provided by e-commerce that allow for personal or
business involvement through the Internet (Young, 1999; Mujahid, 2000; Lawrence, 2001).
3.3.1 E-commerce categories

There are many ways in which e-commerce transactions can be classified. One is by
looking at the nature of the participants in the e-commerce transaction. The major e-
commerce categories are business-to-consumer (B2C) e-commerce, business to business
(B2B) e-commerce, consumer to consumer (C2C) e-commerce and Government to
business/consumer (G2B/C) e-commerce.
UNCTAD (2003) argues that in 2001, annual B2B online sales in the United States
amounted to $995 billion, or 93.3 percent of all United State e-commerce. Private-sector
estimates of the value of B2B trade in the European Union put it at between nearly $185
billion and $200 billion for the year 2002. In the Asia-Pacific region, it grew from about
$120 billion in 2002 to around $200 billion in 2003 and $300 billion by 2004. According to
54
UNCTAD (2003), African B2B e-commerce in 2002 was expected to amount to $0.5
billion in 2002 and $0.9 billion in 2003, with South Africa accounting for 80 to 85 percent
of these amounts (UNCTAD, 2003; Laudon and Traver, 2003).
The North American online retail market was anticipated to grow 45 percent in 2001 to £65
billion for B2C, according to a joint study conducted by the industry group Shop.org and
the Boston Consulting Group (cited in Patton, 2001). In the second quarter of 2004, eBay,
the leader in online consumer auctions hosted 332 million listings, with 8.0 billion dollars
of goods trading on the site. Some of the technologies developed by pioneers in this
medium (e.g. eBay and Onsale.com) have already found interesting applications in the B2B
space as well. The government market is strikingly similar to B2B. As Furth (2001) says: if
the 20 percent cost saving claimed by B2B proponents can replicated in B2G, the
implication for tax payers as well as market entrants will be enormous in this $1.5 trillion
market.
E-commerce has the potential to radically alter existing economic and social structures and
arrangements. Not surprisingly, it has become a major pre-occupation of policy makers and
business over the last few years (Davis, 2003). The two main crucial driving forces behind
the new economy are the Internet and e-commerce (Wong and Seok Ling, 2001).
E-commerce forms part of a broader process of social change, characterised by the
globalisation of markets, the shift towards an economy based on knowledge and
information, and the growing dominance of technology. In order to allow a smooth
55
transition to e-commerce, investments are required in the social infrastructure and skills to
enable people to use the technology in a way that is compatible with the local
circumstances, cultures and abilities of users in developing countries (Straub, 2003).
The Internet has also been at the heart of a further deepening of ICT investment, by making
possible a sharp increase in the quality and functionality of existing ICT equipment. It
creates an environment that substantially lowers the entry barriers for e-commerce, in part
because it adheres to non-proprietary standards based on the existing communications
infrastructure. It has been argued in the OECD report (2003) that earlier forms of e-
commerce among firms required established relationships, expensive and complex custom
software, and dedicated communication links and, in many cases, strictly compatible
equipment.
Additionally, Hawkins et al., (1998) argued that e-commerce provides extra benefit to the
agricultural sector by providing better information about market prices and has fostered the
emergence of new online commodity markets. In construction, it reduces the need for
blueprints and allows seamless communications between subcontractors. In manufacturing,
it generates new efficiencies by reducing procurement costs and improving supply chain
management. Its role in the services sector is linked to qualitative aspects of products, such
as convenience and customisation, thereby reducing costs and delays and increasing
reliability (Hawkins, et al., 1998)
56
3.3.2 E-commerce in developing countries
A significant amount of the Third World is already partially developed and a sustainable
amount of the population has a demographic profile similar to that of the west (Goldstein
and O’Connor, 2000). The Third World is also a great reservoir of untapped talent, which if
helped, would flourish rapidly, joining and contributing to the developed world’s economy
(UNCTAD, 2003). The potential of e-commerce applications to enable access to global
markets and to reduce barriers to market entry is a theme which is heavily emphasised in
the burgeoning literature on the “promise” of e-commerce for developing countries (WTO
2001; OECD 1999; Goldstein and O’Connor 2000; Mann 2000; UNCTAD 2000, 2001).
The WTO (2001) claimed that e-commerce would facilitate low cost access to international
bidding and supply processes for developing country firms, and to market information such
as import restrictions, customs’ regulations, and potential demand. Several authors have
mentioned the potential of e-commerce for expanding the markets of developing countries’
firms, either through online intermediaries or directly through the use of corporate websites
(Choi et al., 1997; WTO, 2001; OECD, 1998a; Panagariya, 2000; WIPO, 2000; UNCTAD,
2001). According to the WIPO (2000), e-commerce provides developing country producers
with opportunities for accessing new international markets at low cost and minimal capital
investment, for improving competitiveness and customer services, and for reducing
transaction cost and overheads.
57
It is generally believed that e-commerce enables developing country producers to overcome
traditional limitations associated with restricted access to information, high market-entry
costs, and isolation from potential markets (April and Cradock, 2000; Cohen et al., 2000;
Maitland, 2001). It also is expected to provide opportunities for producer firms in
developing countries to enhance their international profile and to develop direct one-to-one
trading relationships with international buyers and sellers. It can also expedite the ability of
developing country suppliers to obtain information about buyer requirements in
industrialised countries (Daniel, 2002).
The use of computers and the Internet for business are not widely understood in many
developing countries, let alone e-commerce. Being part of global e-commerce processes
requires knowledge of many complex systems including online promotion, international
payments, and shipping that are beyond the current limited capacity of most businesses
(Cohen et al., 2000). Moreover, during the ‘dot-com’ bubble, expectations of e-commerce
were raised unrealistically high by reports in the mass media and, together with the lack of
success of early adopters; many entrepreneurs are now sceptical of its relevance to
developing countries (Pastore, 2001).
B2B e-commerce offers two important advantages for firms in developing countries. First,
e-commerce-related transaction costs are less sensitive to distance than traditional
marketing channels, so access to global markets is made easier. Second, by amplifying and
making market channels more efficient, B2B e-commerce should enable developing
58
country firms to retain a larger share of the final consumer-price of products (Humphrey,
2002).
Since the late 1990s, an increasing number of developing countries have followed the
example of developed countries and launched their own national ICT programmes and
strategies. These cover a broad range of policy areas, such as awareness raising,
infrastructure building, telecommunications deregulation, education and labour-force
training, changes in legislation, and e-government (UNCTAD, 2003). The report stated that
developing countries may be better to focus on shared-access models than on connecting all
households, which would require large amounts of funding. For example, the use of ICT
and the Internet can be broadened by setting up public access points or facilitating the
provision of free Internet access in all public schools, universities and other public locations
such as libraries, and by establishing tele-centres throughout the country (UNCTAD, 2003).
Therefore, enhancing awareness and public understanding about the benefits of ICT is often
an important starting point in a developing country’s policy planning. Other priority areas
for developing countries are basic access to ICT, low-cost hardware and software, and the
use of local-language websites. Furthermore, in many developing countries a lack of local
Internet content leads most people to purchase online from foreign sites (mainly in
developed countries) rather than local or even regional sites (World Bank, 2004; UNCTAD,
2003).
59
E-commerce is still in its infancy in many developing countries. Developing countries need
to take into consideration that building telecommunications infrastructure is costly. In many
cases, countries will need inflows of FDI to improve domestic infrastructure. This means
that, in addition to establishing a well-regulated telecommunications market, they need to
put in place policies to ensure an appropriate investment climate for Foreign Service
providers (UNCTAD, 2003). Moodley et al., (2002) conducted an in-depth quantitative and
qualitative analysis of the use of B2B e-commerce by manufacturing firms in South Africa.
The study was based on 120 firm-level interviews and 31 interviews with industry experts.
The evidence indicates that the incidence of use is fairly low. Although 87 percent of the
firms had access to the Internet, only 49 percent had a corporate site and only 22 percent
were using the Internet for order taking.
3.3.3 E-commerce in Libya
E-commerce should increase the efficiency of Libya’s economy to make their products
higher quality and their customer-service more efficient. Additionally, it should also create
artificial barriers that the Libyan society will have to find ways to solve by adjusting their
business practices to accommodate them. E-government initiatives should enhance the
effectiveness and efficiency of the Libyan government and improve its relationship with the
public and private sectors of the local economy. E-commerce is rapidly changing the
foundation of the Libyan government policies and improving their online communication
strategies for expanding their economy.
According to Business Middle East (2002), rising demand in fixed-line, mobile and Internet
service, Libya has a long way to go to catch up with its poorer neighbours like Egypt and
60
Tunisia. The Libyan government owns and operates both the fixed-line and mobile network
systems. The postal system is also nationalised with post-office boxes in all the large
towns. According to The General People’s Committee for Tourism (2006) international
postal services to Libya can be slow. The average time for airmail is around 7 to 12 days.
Surface mail can take considerably longer. There is no guarantee that mail will be
delivered, therefore using a good courier service for delivery for business correspondence is
recommended (The General People Committee for Tourism, 2006; eBiz Libya, 2007). The
country has only around 605,000 fixed lines for a population of 6.3 million, and only
40,000 mobile users (a penetration rate of less than 1 percent) and 10000 Internet service
subscribers. However Libya has developed significantly, as demonstrated in Table 3.5, the
percentage of people having landlines in 1995 was 5.9 and it had doubled in 2002 by
almost 10 percent. The same issue applies to mobile technology; the Libyanna Mobile
Technology Company argued that the subscriber numbers to its service exceeded one
million, where dial-up subscribers according to LTT internal documentation reached 55,000
in 2006. Generally growth and development are slow, but not because of any lack of
demand. Internet cafés are spreading rapidly, with more than 50 in Tripoli alone.
Table 3.5 Telephone lines in Libya, Source: UNDP, 2000

Year Telephone lines (per 100 people)
1959 0.7
1964 1.1
1969 -
1974 1.5
1980 2.4
1995 5.9
61
Internet users are mainly young people and teenagers who surf the Internet mostly for
leisure and entertainment rather than shopping around or hunting for bargains. Several
factors could be summarised as a result which are:
 Consumers are not yet heavily involved in using the Internet and become e-
commerce customers.
 E-commerce in Libya is still in its infancy stages of development.
 Traditional trade infrastructure is better established than e-commerce infrastructure.
 E-commerce is complementary to traditional trade activities.
 E-commerce is only a threat to traders who do not offer good services to their
customers (Hamed, 2004).
Furthermore, the announcement of the lifting of Custom tariffs on more than 3,500
imported commodities could result is reducing the cost of products which will reduce the
threat of e-commerce effects on traditional businesses. According to the Economist
Intelligence Unit Limited (2005), the average tariff rate was almost 22 per cent, but this
disguised an extremely complex system of tariffs, ranging from zero to 425 per cent. The
latest move will undoubtedly contribute to lower prices, and help curb bureaucracy, reduce
smuggling and increase trade volumes.
3.4 E-government
Since the mid-1990s governments around the world have been executing major initiatives
in order to tap the vast potential of the Internet for the distinct purpose of improving and
62
perfecting the government process. Like the personal computer, the Internet has become an
indispensable tool in the day-to-day administration of government (cdt.org, 2006). E-
government is the birth of a new market and the advert of a new form of government that is
a powerful force in the Internet economy, bringing together citizens and businesses in a
network of information, knowledge, and commerce. It also enables government to be more
transparent to citizens and businesses by providing access to more of the information
generated by government (UNCTAD, 2007; Laudon and Laudon, 2006). According to
Daniel (2002), e-Procurement is among the ُE-government services that will allow
transparency in the bidding process for projects and supply and give opportunities to
smaller businesses, which otherwise are not able to bid on big government procurement
projects. Also, once the e-government strategy of a country has been formulated, agencies,
bureaucracies and public services will be aligned towards promoting those sectors which
have been pinpointed for growth. Additionally, a working group (2002) stated that there are
many possible reasons and goals for e-government which could be categorised as:
 Improving services to citizens;
 Improving the productivity (and efficiency) of government agencies;
 Strengthening the legal system and law enforcement;
 Promoting priority economic sectors;
 Improving the quality of life for disadvantaged communities; and
 Strengthening good governance and broadening public participation
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Federal and state government business is an institution in and of itself. E-commerce has
emerged as governments look at moving procurement online. The government market is
strikingly similar to B2B. Government-to-consumer business has done well. For example,
paying for a speeding ticket and a renewing driver’s licence online have paid dividends to
governments agencies as well as customers (Awad, 2004).
E-government services are designed to increase the efficient flow of information between
government institutions and businesses. It may include information exchange between
government bodies of different nations. These services may utilize some of the components
of G2C and G2B services but generally require more direct access to databases and
applications (cdt.org, 2006).
There are several key factors that define the core areas of an enabling e-government
environment. Yet because the visions, goals and policies that encompass e-government
vary considerably among practitioners and users, comparative indicators may not always be
precise. Several proven indicators, however, do exist that are representative of a country’s
capacity to launch, sustain, perfect and promote an effective e-government program and
can be used as dependable benchmarks. Telecommunication indicators like the numbers of
PCs, Internet hosts, and telephone lines are indispensable, as without these technologies a
country’s capacity to sustain online service delivery is nonexistent. Analysing website
content, access patterns, online services and official information, give only a partial account
of a country’s overall e-government environment (cdt.org, 2006; UNCTAD, 2003). E-
government can serve a variety of different ends: better delivery of government services to
64
citizens, improved interactions with business and industry, citizen empowerment through
access to information, or more efficient government management. The resulting benefits
can be less corruption, increased transparency, greater convenience, revenue growth, and/or
cost reductions.
3.4.1 E-Government in developing countries
The government context for e-commerce affects businesses in three ways. First, in most
countries, the government is one of the largest buyers of goods and services. Many
governments also make sure they buy a share of their goods and services from domestic
Small-to-Medium Enterprises (SMEs). Second, businesses turn to the government for a
wide variety of services, from customs clearances to business licenses. Today the length of
time needed to obtain these services and, in some cases, the lack of transparency in the
process can and often does thwart SMEs efforts to compete internationally. To the extent
that governments in developing countries can improve the efficiency and transparency of
these business services, the better its SMEs will be able to compete internationally (Payne,
2002; Dada, 2006).
The UNCTAD (2003) report, recommends that governments in both developed and
developing countries play an important role in promoting and facilitating the development
of the information society and economy. Above all, governments should lead by example
by adopting e-government practices. Experiences show that in many developed countries
that have enjoyed fast growth in ICT, government has been closely involved in promoting
ICT development. Governments play an important role as leaders, especially at the earliest
65
stages, by providing vision, raising awareness and making ICT development a national
priority (UNCTAD, 2003).
3.5 M-commerce
E-commerce is considered to be the buying and selling of information, products, and
services via computer networks. Thus, a primary distinction between M-commerce and e-
commerce lies in the differences between transactions and access. E-commerce is oriented
toward supporting and realising transactions. However, the wireless protocol originally
designed to facilitate mobile commerce transactions, Wireless Application Protocol (WAP),
has not fulfilled its technological promise, so the most distinctive feature of M-commerce
that has emerged in many of the larger mobile markets is the facilitation of enhanced
information network access (Laoudon and Traver, 2003). M-commerce has two major
characteristics that differentiate it from other forms of e-commerce. M-commerce is based
on the fact that users carry a cell phone or other mobile device everywhere they go so that
with M-commerce people can be reached at any time (Turban and King, 2003).
There are a variety of Internet-like applications available for today’s mobile phones. WAP
commercially launched by many operators in 2000 and allows mobile phones to browse the
Internet. WAP technology provides an effective solution for accessing the web in the short
term and realising Mobile Websites (MEB) in the long term. Through the use of WAP
devices, such as WAP phones, people can keep in touch with the Internet world anywhere
and any time. It is expected that this will lead to the development of many innovative M-
66
Commerce services. Users access websites specially adapted to fit the screen size of a
mobile phone (Chan and Lee, 2001; Effy, 2002; Minges, 2007).
M-commerce should be recognised as a unique business opportunity with its own unique
characteristics and functions, not just an extension of an organisation's Internet-based e-
commerce channel (Minges, 2007). Most wireless companies will be charging their
customers an extra fee for data-time instead of air-time, which means that users can have a
dedicated connection to the Internet with cell phone and only be charged when data are
sent. This allows a business people to stay online with their wireless devices connected to
their payment terminals at all times, and only be charged when they key in a transaction
(Effy, 2002).
Mobile finance applications are likely to be one of the most important components of M-
commerce. These applications include mobile banking, bill payment services, M-brokerage
services, mobile money transfers, and mobile micro payment. These services could turn a
mobile device into a business tool, replacing banks, ATMs, and credit cards by letting a
user conduct financial transactions with a mobile device (Turban and King, 2003). Wireless
payment systems transform mobile phones into secure, self-contained purchasing tools
capable of instantly authorising payments over the cellular network for goods and services
consumed. In addition, micro-payment, which is electronic payment for small-purchase
amounts, can be implemented in a variety of ways. One way is that the user could make a
call to a certain number where per-minute charges equal the cost of the vending item; this
method transfers money from the user’s telephone bill to the vending provider’s account.
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Another way to perform micro-payment is by using prepaid cards purchased from a service
provider, bank, or credit card company. Attaching a smart card with prepaid money on it to
a mobile device is another option. Furthermore, in addition to paying bills with cheques or
through online banking, one can pay bills, such as MasterCard or utility bill, directly from a
cell phone. This can be done via bank, a credit card, or a prepaid arrangement (Chan and
Lee, 2001; Effy, 2002).
3.5.1 Mobile commerce in developing countries
M-commerce might be the solution for developing countries to overcome ICT and
broadband problems that because the use of wireless device enables the user to receive
information and conduct transactions anywhere, at anytime (Chan and Lee, 2001). Wi-Fi
(Wireless Fidelity) “hot spots” (places where Wi-Fi enabled computers can connect to the
Internet) are proliferating in airports, railway stations, hotels, cafes and other public spaces,
mainly in the United States and Western Europe. Besides its applications for private users,
the technology can be useful for people who work on the move and need to connect to their
offices. In industries such as manufacturing, logistics and retailing, and thanks to electronic
“tags” that can be attached to products or components and beam information about their
location or functioning, Wi-Fi can be used to manage various aspects of production and
distribution (King, et al., 2006).
While Wi-Fi technology clearly offers significant benefits to Internet users and strong
growth in its use can safely be anticipated, specific business models for its commercial
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exploitation are only starting to be developed. For developing countries, Wi-Fi technologies
represent an opportunity to provide low-cost broadband access that is relatively simple to
deploy, at least in urban areas. In the words of Kofi Annan, one time Secretary-General of
the United Nations,
“We need to think of ways to bring wireless fidelity applications to the

developing world, so as to make use of unlicensed radio spectrum to deliver
cheap and fast Internet access”.
(UNCTAD, 2003, P35).
3.6 Payment Methods
Payment systems constitute part of the basic structure of a country’s economy and financial
markets (Dajankov, et al., 2003). Electronics and information technologies are rapidly
changing the banking and financial services industry. Online banking and electronic
payment systems are new, and the development and diffusion of these technologies by
financial institutions is expected to result in a more efficient banking system (Awad, 2004).
This technology offers institutions alternative and better delivery channels through which
banking products and services can be provided to consumers (Panopoulou, 2001). The
business of banking has been dramatically altered over the past twenty years, as
exemplified by the rise of wholesale banking, multinational banking, Euro-banking,
international banking facilities, multiple currency loans, collateralised mortgages, interest
rate and currency options and swaps, and financial futures. Credit cards, debit cards,
automated teller machines, cash management accounts, electronic fund transfers, point of
sale terminals are also part of this world-wide process of change which began in the 1960s,
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has been sustained over two decades, and continues to re-shape the nature of banking and
financial markets (Panopoulou, 2001).
Very important long-term technical changes are beginning to affect the payment systems,
especially the continuing decline in computing costs and the physical size of powerful
computer chips, along with the associated spread of powerful telecommunications
technologies. The widespread availability and acceptability of computers both at home and
in the offices has accelerated the process. At the same time, the cost of communications has
been falling dramatically, broadly opening up markets world-wide. These trends have a
marked impact on the payment systems and they offer potentially significant avenues for
improvement of the efficiency of existing arrangements and for the creation of new
payment mechanisms (Chaffy, 2002).
Historically, payment system transactions were exclusively provided by the banks.
However, the dominance of small payment systems by the banking industry is being
challenged by a nascent industry reacting to consumer demands. Today many non-bank
entities provide these services. In fact, the competition for the provision of payment system
mechanisms has turned monetary value transfer into a commodity. The banking industry
has trailed other industries in developing and offering electronic money payment systems
for small-value transactions (Sifers, 1997). The Internet opportunities have attracted a wide
range of players, from big and established organisations such as MasterCard, Visa,
Microsoft, and the major banks, to newcomers such as Digi-Cash, Cyber-Cash and First
Virtual (O’Mahony et al., 1997; Awad, 2004).
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Electronic payment systems developed for transferring bank payments between the banks
are becoming increasingly common in all industrialised countries. They speed up payments
transfer and improve the quality of payment transmission. Compared with traditional
methods of transmitting payments, the new systems involve significant economies of scale
and rationalisation gains. It would hardly be possible to increase the volume and value of
payments at the present pace without corresponding advances in payment technology. At
the same time, the implementation of new payment systems is helping to enhance the
planning and monitoring of bank liquidity. As the systems require large investments, they
also call for co-operation between banks and participation by the central bank (Llewellyn,
1999). In case of payment systems, the banking sector has succeeded well by coming up to
expectations set by the fast developing market needs and other areas of society.
Globalisation and faster communication have caused some changes in payment methods.
Credit cards and travel cheques, as well as Internet payments, have been some solutions
from the banking side to secure its position in financial markets in previous years
(Saarinen, 2000; Panopoulou, 2001).
3.6.1 Payment in developing countries
Only the upper classes in developing countries use credit and debit cards to pay for their
shopping as a way of showing their class (UNCTAD, 2003). Similarly in the some other
parts of the world, especially in Asia and Latin America, credit cards are not a widespread
common feature in society (Ocampo, 2001). Therefore, to expect many sales on the Internet
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would be disappointing for a Western company that hopes to do tremendous business on
the Internet in a foreign country that does not use credit card as payment method (Pons et
al., 2003).
According to Humphrey et al., (2003), in developing countries, the underdeveloped
electronic payments system is a serious impediment to the growth of e-commerce. In these
countries, entrepreneurs are not able to accept credit card payments over the Internet due to
legal and business concerns. The primary issue is transaction security. The absence or
inadequacy of legal infrastructures governing the operation of e-payments is also a concern.
Hence, banks with e-banking operations employ service agreements between themselves
and their clients (Humphrey et al., 2003). Innovations affecting consumers include credit
and debit cards, automated teller machines (ATMs), stored value cards, and e-banking.
Innovations enabling online commerce are e-cash, e-checks, smart cards, and encrypted
credit cards. These payment methods are not popular in developing countries. They are
employed by a few large companies in specific secured channels on a transaction basis.
Innovations affecting companies pertain to payment mechanisms that banks provide for
their clients, including inter-bank transfers through automated clearing houses allowing
payment by direct deposit (Andam, 2003). The payment schemes available for online
transactions in developing countries are cash-on-delivery; many online transactions only
involve submitting purchase orders online. Payment is by cash upon the delivery of the
physical goods and bank transfer payments; after ordering goods online, payment is made
by depositing cash into the bank account of the company from which the goods were
ordered (Andam, 2003; Awad, 2004).
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3.7 Regulation and legislation
One of the most controversial sides to the increase of e-commerce on the Internet is that
there is no regulation of goods, allowing pornography, piracy of products, and other illegal
actions to create security and legal issues that may never have total solutions (Davis, 2003).
Much of the concern to date on the civil side has resolved around threat to privacy,
intellectual property rights, the prospect of universal defamation and the implication for
national tax collection. On the criminal side, there are concern about the security of
network systems and unauthorised access and denial of service attacks, concerns about the
availability of indecent, obscene and racist content, concerns about the use of computer
technologies for traditional property offences such as theft, and fraud, and concern about
publishing hate speech and online talking (Beynon-Davies, 2002; Akdeniz, 2000; Reed,
2004). Governments have been involved primarily in finding ways to put some regulation
into the security issues of the Internet. Recently, many United Staes congressmen and other
political officials have increased their concern over the amount of unsolicited products like
pornography that are constantly being sent to global emails through direct marketing
(Fredricks, 2001).
Even though, copyright laws are carried over to e-commerce products and sales; there will
be many changes in the online marketplace for information goods. Since people cannot
make copies of material available on their own and sell them without the permission and
copyright agreement in retail outlets, they should not be able to do that with videos, movies
and books or other products sold online through e-commerce (Vernon, 2000). However,
73
regulation and prevention of these problems is very difficult for individual governments to
do. The Internet may make it necessary for world governments to regulate its usage and
protect the rights of manufacturers whose products have been pirated and sold for profit
(Brinson et al., 2001; Reed, 2004). The same rights that apply to the real business world
must also apply to the virtual and digital world of e-commerce, by using a combination of
cryptographic techniques and laws guaranteeing that unauthorised copies of digital products
cannot be made. The ease of transactions on the Internet would then force major changes
(Fredricks, 2001).
Much has already been done in the non electronic environment to protect individuals
against organisations holding information on them, the most notable of these being the
‘Data Protection Act 1998’ which deals with what information can be held by an
organisation on an individual (Turban et al., 2002). Currently many organisations, such as
AltaVista, America Online and Microsoft, are operating under the TRUSTe seal (they call
it a “trustmark”) which appears at the bottom of an e-tailers website. Its members hope that
customers will use the TRUSTe seal as an assurance of their privacy policy, credit card
security, fulfilment process integrity etc. (truste.org, 2006).
3.8 E-commerce challenges
The Internet does not only deal with money, but also with large databases, full of vital and
sometimes top secret information that companies, organisations and governments have
within their own environment. Also, the Internet can be easily characterised as an FDI
(Foreign Direct Investment) tool. Companies apply different strategies of how to enter a
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foreign market, expand their operations and become multinationals. Companies do that in
order to create a competitive advantage over other companies. Such firms gain competitive
advantage by exploiting new resource; low labour-costs, cheap raw materials, the country’s
infrastructure, communication channels, legislation, etc.
The revolution of e-commerce brings along some challenges, not only for the firms, but for
governments as well. These challenges can influence at a microeconomic and
macroeconomic environment level. E-commerce and e-business require a complete change
of the business structure. Firms going digital need to consider restructuring their entire
business or even creating a new one. They need to implement new management processes,
changes in their business culture and follow different procedures for managing their
employees. Also, they need to create a new structure for information systems, networked
processing functions and most importantly, they will need to change their entire business
strategy (Chaffy, 2002; Laudon and Traver, 2003).
All E-businesses, in order to co-ordinate their online transactions and business activities as
well as the potential linkage with other firms within its industry, need to build a very strong
IT infrastructure. IT infrastructure has the power to connect the firm with infrastructures of
other organisations while bringing down barriers and creating a new ‘business global
village’ (Chaffy, 2002). However, digital firms have to select the most suitable Internet
technology that is compatible with their business processes and data structures. There are
different kinds of hardware and software tools that can be used for different business
applications. Therefore, the firm must choose the right set of technologies for its IT
75
infrastructure (Laudon and Laudon , 2002). Moreover, technology is constantly upgrading
and introduces new systems, applications and hardware. A company has to keep up with the
technology pace in order to create well functioning business processes among customers
and suppliers via the Internet. This requires the reconstruction of information architectures
and IT infrastructures. According to Mitchell et al., (2004) there are five basic problems
that stand in the way of implementing these new changes.
 Loss of management control: The end users are becoming more independent,
capable of collecting, storing and handle software. This occurs due to the lack of a
single, central point where the need of management can occur.
 Connectivity and application integration: A company needs to upgrade its IT
infrastructure in order to have compatible networks and standards and eliminate
connectivity problems.
 Organisational change requirements: The old organisation structure has to be
changed to be compatible with the new IT infrastructure in order to be more
effective and uniform.
 Hidden costs of enterprise computing: Some unexpected costs and expected
savings that did not occur are generating problems. These costs are generated from
hardware and software installations, maintenance costs, labour costs etc.
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 Scalability, reliability, and security: The increased load of data transactions and
storage as well as the traffic of applications such as audio, streaming video and
graphics, drive managers to develop strategies to manage those issues.
This is done to primarily take advantage of lower labour and raw material costs (Brinson et
al., 2001). Therefore, Governments must bring down the different barriers that impact on e-
commerce, such as taxation, extensive regulation and censorship; and allow e-commerce to
grow up in an environment driven by markets. Also, governments should support the
creation of a legal framework for doing business on the Internet (United States
Government, 2004). Additionally, e-commerce will open the market for highly skilled
workers. From the expansion of e-commerce this demand will increase and it will
significantly change the labour market. All the skilled workers that are living in countries
that cannot comply with the salary and technology requirements will migrate to more
developed countries that can easily accommodate their needs and demands (United States
Government, 2004).
3.9 Factors Influencing E-commerce Adoption
Radaideh and Salim (2004) introduced factors of e-commerce adoption decision in a case
of developing countries as shown in Figure 3.2 below. They argue that there are critical
factors affecting the adoption of e-commerce by firms which are classified into two main
77
categories; internal and external factors. Internal factors are within the firm and external
factors are environmental in nature.
Internal factors are IT readiness which refers to the level of IT usage within the firm. This
category includes information and networking security, system interrelation, data
conversion, hardware and software compatibility, adequacy of the firm’s IT infrastructure
and migration from legacy system (Graham and Cobham, 2006). The second internal factor
category refers to the firm’s financial readiness. Graham and Cobham (2006) argued that
financial readiness is reflected by the top management’s willingness to fund an e-commerce
adoption project. The major cost of e-commerce adoption is the cost of educating and
training management and employees to use e-commerce (Graham and Cobham, 2006).
Another concern of the top management is the losses of productivity due to abuse by IT
staff readiness factor category refer to the IT and e-commerce literacy level inside the firm.
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Figure 3.2 Factors relating to E-commerce adoption decision by a firm

Source: Radaideh and Salim, 2004
Internal factors External factors

IT readiness Global completion
Financial readiness Local completion
Staff readiness Customer pressure

E-commerce
Management support adoption Trust & Culture
Firm strategy Law & regulations
Firm culture IT infrastructure
Firm size Industry Nature
Anticipated benefits Government Nature
Management support is another important internal factor category. Graham and Cobham
(2006) state that this category represents the extent to which the top management
recognises the importance of e-commerce adoption. The recognition is reflected in the
support and leadership of top management executives in e-commerce adoption process
(Grover, 1993; Thong, 1999; Godenhielm, 1999; Tabor, 2003). The firm’s internal culture
refers to the collaboration level and style among the different managerial levels and team
spirit and dedication to the business processes. Firm size is one of the main reasons for not
adopting e-commerce. Large firms have more resources and infrastructure to facilitate
implementation of e-commerce adoption projects. The anticipated financial and managerial
benefits are important factors affecting the adoption decision.
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There are several external factor categories to be considered. The first two categories
include pressure exerted by competitors on a firm. Tabor (2003) argues that competitive
intensity increases the need for e-commerce adoption by firms. The competition leads to
environmental uncertainty and increases the need and rate of adoption. Allen (2000)
emphasised the importance of trust in maintaining productive adoption of e-commerce.
Culture has been considered as a critical factor affecting e-commerce adoption
(Ranganathan, 2003). Furthermore, customer pressure on firms to adopt e-commerce is also
considered an important category. They stated that the industry to which the firm belongs
affects the adoption decision. The nature of government is among the most important factor
groups affecting e-commerce adoption. Ranganathan, (2003) argues that government needs
to build knowledge and set standards. Policies and regulations are also important factors at
the local and global stages.
Radaideh and Salim (2004) explained the main factors affecting e-commerce adoption in
developing countries but did not develop a solution for e-commerce adoption. Another
matter to be addressed is that they separated the external and internal factors as different
issues where in reality these two factors are interrelated, for example IT readiness depends
on the external and internal factors together and can not benefit the organisation if one is
used without the other.
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3.10 Summary
information, and the growing dominance of technology. In order to allow a smooth
transition to e-commerce, investments are required in the social infrastructure and skills to
allow the use of the technology in a way that is compatible with the local circumstances,
cultures and abilities of users in developing countries. E-commerce provides developing
country producers with opportunities for accessing new international markets at low cost
and minimal capital investment, for improving competitiveness and customer services, and
for reducing transaction costs and overheads. It also enables producers to overcome
traditional limitations associated with restricted access to information, high market-entry
costs, and isolation from potential markets.
Being part of global e-commerce processes requires knowledge of many complex systems
including online promotion, international payments and shipping that are beyond the
current limited capacity of most businesses. An increasing number of developing countries
have followed the example of developed countries and launched their own national ICT
programmes and strategies. These cover a broad range of policy areas, such as awareness
raising, infrastructure building, telecommunications deregulation, education and labour
force training, changes in legislation, and e-government, yet they have failed to adopt it
successfully. Developing countries need to take into consideration that building
telecommunications infrastructure is costly.
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For Libya, e-commerce is rapidly changing the foundation of the Libyan government
policies and improving their online communication strategies for expanding their economy.
Even though, Libya has a long way to go to catch up with its poorer neighbours like Egypt
and Tunisia. The government owns and operates both the fixed line and mobile network
systems. The postal system is also nationalised. International postal services to Libya can
be slow and there is no guarantee of delivery. The country with a population of 6.3 million
has only around 605,000 fixed lines, one million mobile users, 55,000 dial-up subscribers
in 2006. Most of the Internet services in the country are delivered by the Libya Telecom
and Technology Company (LTT) the only authorised Internet service provider in the
country. The charge of the service in Libya is high compared to other service providers.
However, the cost of Internet connection is falling dramatically. Internet users are mainly
young people and teenagers who surf the Internet mostly for leisure and entertainment.
Payment systems and regulations for e-commerce are important issues in developing
countries; only economically advantaged people use credit and debit cards to pay for their
shopping as a way of showing their class. The payment schemes available for online
transactions in developing countries are cash-on-delivery; many online transactions only
involve submitting purchase orders online. Payment is by cash upon the delivery of the
physical goods and bank transfer payments. In Libya, cards and electronic payments had
not been introduced at the time of writing this thesis. To expect many sales on the Internet
would be disappointing for a Western company that hoped to do tremendous business on
the Internet in a foreign country that does not use credit cards as a payment method. Also,
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there is no transitional regulation of goods, allowing pornography, piracy of products, and
other illegal actions to create security and legal issues that may never have total solutions.
83
Chapter four: Toward a theoretical framework
84
Chapter four
Towards a theoretical
framework for e-commerce
Drivers and Barriers
85
4.1 Introduction........................................................................................................................................... 87
4.2 Drivers and Barriers ............................................................................................................................. 87
4.2.1 Cost ..................................................................................................................................................... 90
4.2.2 Payment Systems ................................................................................................................................ 92
4.2.3 Legislation and Regulation.................................................................................................................. 93
4.2.4 Infrastructure ....................................................................................................................................... 95
4.2.5 Culture and Religion ........................................................................................................................... 96
4.2.6 Government......................................................................................................................................... 97
4.2.7 Employment ........................................................................................................................................ 99
4.2.8 Competition....................................................................................................................................... 100
4.2.9 Traditional business .......................................................................................................................... 101
4.2.10 Economic Activities ........................................................................................................................ 102
4.3 The E-commerce Drivers and Barriers Model (1) ........................................................................... 104
4.5 Summary.............................................................................................................................................. 107
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4.1 Introduction
information, and the growing dominance of technology in everyday life. This chapter
examines the drivers, benefits and barriers of e-commerce taking extracts from the
literature review chapters (chapters two, three and four) and developing a theoretical
framework to conceptualise e-commerce drivers and barriers.
4.2 Drivers and Barriers
It has been argued in chapter three, that the Internet has the ability to lower some of the
entry barriers to global trading, e.g. geographical location and differing time zones. E-
commerce is expanding rapidly and has facilitated changes by significantly reducing the
costs of outsourcing and co-operation with external entities. E-commerce has helped to
break down the natural monopoly characteristic of services such as telecommunications. E-
commerce is a key technology for speeding up the innovation process, reducing time scales,
fostering greater networking in the economy and making faster diffusion of knowledge and
ideas possible. New Economy (2002) argues that e-commerce has played an important role
in making science more efficient and linking it more closely to business. Using the Internet
to lower communication costs and reduce time-to-market for goods and services exports
makes it a very valuable medium for firms engaged in international trade. The ability of e-
commerce to deliver information of almost any sort in digital format at low cost offers
significant efficiencies that firms can pass on to customers in the form of lower prices. It
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can also help manage supply chains for goods and services in cross-border trade, cutting
overheads associated with marketing, transport and distribution. In agriculture, the Internet
is providing better information about market prices and has fostered the emergence of new
online commodity markets. In construction, it reduces the need for blueprints and allows
seamless communications between subcontractors. In manufacturing, it is generating new
efficiencies by reducing procurement costs and improving supply chain management. Its
role in the services sector is linked to qualitative aspects of products, such as convenience
and customisation, thereby reducing costs and delays and increasing reliability (Gallagher,
1999; Mehrtens et al., 2001; Kendall et al., 2001; Art-am, 2002; OECD, 2003)
Given that the underlying technology of the Internet is inherently global, accessible and
based on open standards, e-commerce applications are optimistically being promoted in the
developing world as relatively cheap to set up and operate and flexible to configure
(Kalakota and Drew, 1996; Chan and Lee, 2001). The ‘optimists’ argue that the impact of
reducing co-ordination costs will significantly influence global trading relationships
(Malone et al., 1987) and encourage firms to find the best producers regardless of location
(Davidow and Malone, 1992; Wigand, 1997).
One could argue that e-commerce drivers vary from one country to another. Some drivers
that are seen in some developed countries are not yet evident in many developing countries
and in some cases those drivers in a developed country could be barriers in other countries.
Some additional drivers were realised for the first time in this research according to the
researcher’s best knowledge. There are a number of barriers to the adoption e-commerce
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such as security, cost and taxation or even in some circumstances, too much business for a
company to cope with. Furthermore, one of the traditional barriers cited by many
organisations to the growth of e-commerce is the relatively high telephone charges for
Internet access, the tariffs payable and the cost of connection. Other costs, such as hardware
and web-design, remain beyond the reach of many people’s ability to pay for the service.
Also, Reed (1999) argued that broad-level support for the technology is lacking, both in the
initiation of e-commerce projects and in the allocation of targeted budgets.
There are further barriers specifically related to developing countries. Accessing the Web is
possible only when telephone lines and computers are available, but these technologies are
still in very scarce supply in many developing countries. In addition to this problem,
Internet access is still very costly - both in absolute terms and relative to per-capita income
in most developing countries. While computer prices have fallen dramatically over the last
decade, they are still too expensive in developing countries (UNDP, 2003). Add to this the
human capital cost of installing, operating, maintaining, training and support and the costs
often become beyond the means of many enterprises in developing countries. Moreover,
skilled personnel are often lacking, the transport facilities are poor, and secure payment
facilities non-existent in many countries (Straub, 2003).
Users in developing countries are likely to be engaged in making improvements to their
operations, often focusing on production management, financing and accounting, product
development and marketing rather then paying attention to e-commerce and e-business
strategies. Additionally, many Internet users in developing countries do not speak or write
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good English as well as displaying poor English on web-sites or in emails. Slow responses
generally have the effect of pushing away potential customers (The Asian Foundation
Report, 2002).
There are many issues that could count as drivers and barriers to e-commerce and economic
development at the same time. This is analysed and discussed in the e-commerce chapters.
These issues are cost, payment systems, legislation and regulation, infrastructure, culture
and religion, government, employment, competition, traditional business, economic
activities, knowledge of e-commerce, time and information.
4.2.1 Cost
Cost is one of the main drivers of e-commerce and Internet activities. It is an important
factor for the world’s e-commerce in general and for developing countries in particular.
Using the Internet is a valuable medium for firms and governments engaged in international
trade to reduce and lower costs. E-commerce could help to lower the cost of
communication, time-to-market for goods and services exports (Chaffey, 2002). It also
gives the ability to deliver information of almost any sort in digital format at low cost and
helps to reduce the cost of managing supply chains for goods and services in cross-border
trade (Gallagher, 1999). Reducing selling, buying and procurement cost (WTO, 2001) and
providing the opportunities to sellers and producers to demonstrate their products online
without a need to have an actual shop (Kehoe, 1998) and reducing the cost of customer
service and after-sales service (Hawkins et al., 1998) are other cost reductions resulting
from e-commerce adoption. However, the implementation and maintenance cost could be
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argued to be a barrier to e-commerce. For example, shipping costs can increase the cost of
many products purchased via e-commerce and add substantially to the final price.
Additionally, cost in term of hardware and software remains out of reach in cost terms for
many people and organisations in developing countries (Straub, 2003). Furthermore, the
cost of Internet connection and telephone charges in developing countries is moderately
high compared to developed countries (UNCTAD, 2003). Additionally, the cost of
implementing ICT infrastructure and delivery infrastructure in a country could be high
(Hammond, 2001). Table 4.1 summarises the cost issues that were mentioned in the
literature.
Table 4.1: Cost issues in the literature
Item No Drivers and barriers
Reduces costs 1 Driver

Reduce communication cost 2 Driver
Deliver information in digital format 3 Driver
Reduce the cost of supply chains 4 Driver
Reducing selling cost 5 Driver
Reduce buying cost 6 Driver
Providing opportunities to sell 7 Driver
Reducing the cost of customer service and after-sales
8 Driver
service
Implementation cost 9 Barrier
Maintenance cost 10 Barrier
shipping costs 11 Barrier
Cost in term of hardware and software 12 Barrier
Cost of Internet connection and telephone charge 13 Barrier
Cost of implementing ICT infrastructure 14 Barrier
Delivery infrastructure 15 Barrier
Increase saving 16 Driver
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4.2.2 Payment Systems

Payment systems are another main factor for e-commerce adoption and economic
development. Payment systems, as some other factors, could be drivers or barriers. Having
a payment system will encourage people to do business all over the world and speed up
transactions and other banking activities as well as providing new opportunities to
businesses to provide online services. Djankov et al., (2003) argued that payment systems
constitute part of the basic structure of a country’s economy and financial markets. For e-
commerce to be used successfully in a country, electronic payment has to be installed and
ready. It speeds up payments, transfers and improves the quality of payment transmission
(Lipis et al., 1985) and offers institutions alternative and better delivery channels through
which banking products and services can be provided to consumers. Compared with
traditional methods of transmitting payments, the new systems involve significant
economies of scale and rationalisation gains (Llewellyn, 1999) and are helping to enhance
the planning and monitoring of bank liquidity (Djankov , et al., 2003). Additionally, a
network of ATMs offers a new method in daily banking affairs. It adds value for consumers
through its ability to increase time and place convenience for the routine banking functions
of obtaining cash and making deposits (Llewellyn, 1999). ATMs offer a more cost-effective
means of delivering these routine functions and frees branch personnel for selling extra
services. (Lipis et al., 1995). On the other hand, adopting such a system requires large
investments that many developing countries will not be able to provide. It also calls for co-
operation between banks and participation by the central bank (Llewellyn, 1999) which
needs government involvement. Additionally, social and technical factors need to be
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considered while adopting such technology (Utterback, 1994). In the world of banking,
interesting new technology in the form of automatic services is strongly limited, so long as
the old familiar services are easily available (Llewellyn, 1999). Today, many electronic
payment activities are carried out by other companies other then banks which will result in
higher charges in developing countries if no competition exists. Other issues such as
securing payment systems in a country would need significant investment. Table 4.2
summarises payment issues that were mentioned in the literature.
Table 4.2: Payment issues in the literature

Item No Driver or barrier
Payment system will encourage people to do business 1 Driver
Payment system will speed up transactions and other 2 Driver
banking activities
Payment system provides new opportunities for 3 Driver
online services.
Payment systems constitute part of the basic structure 4 Driver
of a country’s economy
For E-commerce to be used, E-payment has to be 5 Driver
installed and ready.
Adopting payment system requires large investments 6 Barrier
Payment system needs co-operation between banks 7 Barrier
and participation by the central bank
Social and technical factors need to be considered 8 Barrier
while adopting Payment system
In the world of banking interest new technology in 9 Barrier
form of automatic services is strongly limited so long
as the old familiar services are easily available
Electronic payment activities are carried out by other 10 Barrier
companies which will result in higher charges
Securing payment systems in a country would need 11 Barrier
significant investment.
Payment in developing countries is cash or cheques 12 Barrier
4.2.3 Legislation and Regulation

Legislation and regulation are barriers and drivers to e-commerce. It was been argued that
e-commerce needs legislations and regulation to control of the flow of business over the
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Internet (Awad, 2004). There is a large number of goods and commodities that can be
bought and sold illegally online. Piracy of products is also a major problem. The absence of
legislation and regulation has led to difficulty in finding a total solution. One of the most
controversial aspects of the increase of e-commerce on the Internet is that there is no
regulation of goods, allowing pornography, piracy of products, and other illegal activities to
create security and legal issues that may never have total solutions (Mark 2003; Hamed,
2004). Furthermore, online viruses are also becoming a serious matter that is under
scrutiny, since many major corporations have had their computer mainframes broken into
by hackers (Vernon, 2000). In addition, the full range of pirated software available in the
market at low or no cost requires copyright and other issues to be considered (Fredricks,
2001). The regulation of e-commerce will build customer’s trust and show the possible way
forward to deal with technology and international suppliers and customers. However,
regulation and prevention of these problems is very difficult for individual governments. E-
commerce regulation could conflict with other legislation and regulation in a country.
Table 4.3 summarises the legislation and regulation issues that were mentioned in the
literature.
Table 4.3: Legislation and regulation issues in the literature
Needs legislations and regulation to control the 1 Driver

flow of business
Goods and commodities can be bought and sold 2 Barrier
illegally online.
Piracy of products 3 Barrier
The absence of legislation leads to difficulty in 4 Barrier
finding a total solution.
Lack of regulation leads to pornography sales 5 Barrier
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Online viruses becoming a serious matter 6 Barrier

The regulation of e-commerce will build 7 Driver
customer trust
Regulation and prevention is very difficult for 8 Barrier
individual governments.
E-commerce regulation could conflict with other 9 Barrier
legislation and regulation in a country.
Concern about the security of network systems 10 Barrier
Concerns about the use of computer technologies
for traditional property offences such as theft, and 11 Barrier
fraud,
Concern regarding publishing inflammatory 12 Barrier
speech and online racial hatred
4.2.4 Infrastructure
Infrastructure refers to ICT infrastructure, postal infrastructure and any other infrastructure
needed in a country to support e-commerce. If the infrastructure is in a poor condition then
the expectation to see an improvement in the e-commerce adoption is significantly low.
Additionally, the potential for e-commerce is low because of the control of networks by
monopolies or dominant firms in many developing countries (Thorbjornsen & Decamps,
1997). These monopoly companies limit competition by blocking lower prices and
improvement the quality of the services. The infrastructure of a country could be a main
driver to attract international companies and foreign direct investors to do business in that
particular country. For example, international companies could establish branches and
warehouses in Libya to provide services and products not only to Libya but to the whole of
Africa, Arab countries and other Mediterranean countries. However, infrastructure costs are
significant and need new strategies, planning and management which will drive many
developing countries to seek FDI and other assistance from wealthier nations. FDI will
result in moving regulation and control of a country’s infrastructure from the government to
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the international investors. For wealthier developing countries such as Libya, the
government of a country may have other strategic projects to be finished before beginning
new projects. Table 4.4 summarises the infrastructure issues that were mentioned in the
literature.
Table 4.4: Infrastructure issues in the literature
If the infrastructure is in a poor condition then the

expectation to see an improvement in the e-commerce 1 Barrier
adoption is significantly low.
The potential for e-commerce is law because of the
control of networks by monopolies or dominant firms in 2 Barrier
many developing countries
The Infrastructure of a country could be a main driver to
attract international companies and foreign direct 3 Driver
investors to do business in that particular country.
Infrastructure cost is significant 4 Barrier
Infrastructure needs new strategies, planning and 5 Driver
management
4.2.5 Culture and Religion

If e-commerce conflicts with a country’s culture and religion then certain barriers may be
created, e.g. intervention to ban the sale of certain items that violate such culture, traditions
and values (Laudon and Traver, 2003). Culture is the ‘broadcast’ factor in consumer
behaviour because it shapes basic human values, wants, perceptions and behaviours
(Kotler, 2000). For example, selling alcohol in a Muslim country or offering credit-card
services with interest rate could possibly result in driving people away from using that part
of technology. There are many items on sale which contain materials which are obscene or
offensive to a country’s traditions and values, and hence intervention by the system to ban
their sale might be perceived by some as a barrier, and their purchase should be left to
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individuals. There is some consensus that such materials should not be sold online, and
certain barriers to get access to them should be in place to protect young people and
children from moral corruption. Culture and religion could be a driver for e-commerce, e.g.
in Arab countries such as Libya where women are not encouraged to work with men, e-
commerce could help in providing paid work from home for the women. Such action could
be seen as being in keeping with culture, tradition and values. Table 4.5 summarises the
culture and religion issues that were mentioned in the literature.
Table 4.5: Culture and religion issues in the literature
E-Commerce conflicts with culture and religion 1 Barrier

Intervention to ban the sale of certain items that 2 Barrier
violate culture
offering credit card services with interest rate 3 Barrier
Children protection 4 Barrier
Religion issues 5 Barrier
E-Commerce helps to maintain culture 6 Driver
Change in business culture 7 Driver
4.2.6 Government
Governments always play an important role in economic development (Todaro, 1999).
Governments are usually the main customer of small businesses and will support all
investments and improvements in a country’s infrastructure as well as being responsible for
setting legislation and regulation for trade and securing the sustainability of economic
growth (Well, 2005). Therefore, governments should think carefully about e-commerce
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adoption and put strategies for the adoption in place before hand. Thus e-government
strategies would provide citizens, other government departments and companies with
significant advantages and efficiency. E-government is a significant factor for e-commerce
as it delivers services to businesses and the public. According to Daniel (2002), e-
procurement (one of the e-government services) and an online supplier exchange are among
the services included in G2G and G2B services. This allows transparency in the bidding
process and gives opportunities to smaller businesses which otherwise are not able to bid
on big government procurement projects. Also, once the e-government strategy of a country
has been formulated, agencies, bureaucracies and public services may be aligned towards
promoting those sectors which have been pinpointed for growth. Additionally, there are
many possible reasons and goals for e-government, such as improving services to citizens,
improving the productivity and efficiency of government agencies, strengthening the legal
system and law enforcement, promoting priority economic sectors, improving the quality of
life for disadvantaged communities, and strengthening good governance and broadening
public participation. However, e-commerce could affect any economy and its activities. E-
commerce will work with capitalism and globalisation, therefore countries which have
adopted the communist and socialist approaches should be aware that e-commerce may
change the economic approach adopted into capitalism. Additionally, governments tend to
support monopoly organisations and limit the opportunities for private companies which
could affect the adoption of e-commerce. Thus local private companies would not have the
support and experience to compete with large international organisations. Table 4.6
summarises the government issues that were mentioned in the literature.
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Table 4.6: Government issues in the literature
Governments always play an important role in economic 1 Driver

development
The government is usually the main customer of small 2 Driver
businesses
Government will support all investments and 3 Driver
improvements in a country’s infrastructure
Government is responsible for setting legislation and 4 Driver
regulation for trade
Government should think carefully about e-commerce 5 Driver
adoption
E-government strategies would provide significant 6 Driver
advantages and efficiency.
E-government will create new jobs for other private and 7 Driver
public organization
E-government improving services to citizens, 8 Driver
Improving the productivity and efficiency of 9 Driver
government agencies,
Strengthening the legal system and law enforcement, 10 Driver
Improving the quality of life for disadvantaged 11 Driver
communities,
Governments tend to support monopoly organisations
and limit the opportunities for private companies which 12 Barrier
could effect the adoption of e-commerce.
4.2.7 Employment
Employment is an important factor in any economy. It has been argued that e-commerce
may result in job cuts. However, adopting e-commerce technology may result in creating
new job opportunities and encourage employment education and gaining new skills
(UNCTAD, 2003). Hawkins, et al., (1998) argued that ICT seems to offer the greatest
benefits when ICT investment is combined with other organisational assets, such as new
strategies, new business processes, new organisational structures and better worker’s skills.
99
He argued that the contribution of ICT capital to output and labour productivity growth has
been significant and rising in relative terms. Therefore for a country to maximise the
benefit of e-commerce adoption training and education should take place before-adoption.
Table 4.7 summarises the employment issues that were mentioned in the literature.
Table 4.7: Employment issues in the literature
Employment is an important factor in any 1 Driver

economy.
E-commerce may result in job cuts. 2 Barrier
E-commerce may result in creating new job
opportunities and encourage employment 3 Driver
education and gaining new skills
4.2.8 Competition
Competition could drive the economic development of a country by providing cheaper
products and services which could result in many savings that could be reinvested in the
economy and speeding up economic development (Todaro, 1999). According to Hagel and
Armstrong (1997), lower production costs will encourage the entry of new businesses and
thus increase competition and pressure to pass lower costs on to consumers as lower prices.
In addition, consumers will be able to search among thousands of merchants for the lowest
prices, thereby increasing the downward pressure on prices and leading to a shift in market
power from producer to consumer (Hawkins, et al., 1998). On the other hand competition
could destroy small local businesses. These businesses could go elsewhere or cease to exist.
In either case this will affect economic activities, such as taxation and employment. Table
4.8 summarised the competition issues that were mentioned in the literature.
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Table 4.8: Competition issuers in the literature
Competition could drive the economic development of

a country by providing cheaper products and services 1 Driver
Lower production costs should encourage the entry of

new businesses and thus increase competition and
pressure to pass lower costs on to consumers as lower 2 Driver
prices.
Consumers should be able to search among thousands

of merchants for the lowest prices, thereby increasing
the downward pressure on prices and leading to a shift 3 Driver
in market power from producer to consumer
Competition could destroy small local businesses.

These businesses could go elsewhere or cease to exist.
In either case this will affect economic activities such 4 Barrier
as taxation and employment.
4.2.9 Traditional business

Traditional businesses in most developing countries were established long before e-
commerce. These companies are the main economic contributors in the economy.
Therefore government and companies have to work together in monitoring technological
and strategic development in the use of e-commerce in order for these companies to
maintain their place in international competition and restructure their organisations. A
failure to involve traditional businesses could work against e-commerce adoption and
against economic development. Traditional businesses and e-commerce businesses could
work together. Table 4.9 summarises the traditional business issues that were mentioned in
the literature.
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Table 4.9: Traditional business issues in the literature
Traditional businesses in developing countries 1 Barrier

were established long before e-commerce.
Traditional companies are the main economic 2 Barrier
contributors in the economy.
Government and companies have to work
together in monitoring technological and strategic
development in the use of e-commerce in order 3 Barrier
for these companies to maintain their place in
international competition and restructure their
organisations.
A failure to involve traditional businesses would
work against e-commerce adoption and against 4 Barrier
economic development.
Traditional businesses and e-commerce 5 Driver
businesses could work together.
4.2.10 Economic Activities
Gurstein (2000) argued that a free market and the cost of adopting e-commerce technology
could result in delays to e-economic development. He also suggested that a result of
adopting e-commerce technology could be the shift of economic activities away from
marginal or disadvantaged regions towards advantaged regions. The success of e-commerce
can be at the expense of local enterprises in direct competition with international suppliers.
Additionally, the range of goods available on the Internet is very large and cannot be
matched by any one supplier let alone smaller local suppliers thus putting these local
enterprises at a significant disadvantage in certain sectors. Furthermore, Kenny (2002)
argues that government returns (e.g. taxation) might be even lower than company-level
returns because of two negative externalities linked to e-commerce sites. First, the Internet
allows online businesses to gain new customers from traditional businesses. Second, and
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perhaps of greater concern to developing countries’ companies with less access to the new
technologies, Internet investment involves defending market share, so that social returns to
this investment are lower than private returns. Therefore a government should encourage
the use of a country’s resources to provide cheaper prices than anywhere else in the world.
On the other hand the adoption of e-commerce will result in a significant reduction of costs
and providing a variety of products from all over the world. For countries such as Libya
who are importing more than exporting, e-commerce could develop the economic activities
and allow users to enjoy the reduction of costs which could be reinvested in the economy
and help development (Todaro, 1999). Table 4.10 summarises the economic activities
issues that were mentioned in the literature
Table 4.10: Economic activities issues in the literature
The cost of adopting e-commerce technology could 1 Barrier

result in delays to e-economic development.
Adopting e-commerce technology could shift
economic activities away from marginal or 2 Barrier
disadvantage regions towards advantaged regions.
The success of e-commerce can be at the expense of
local enterprises in direct competition with 3 Barrier
international suppliers.
The range of goods available on the Internet is very
large and cannot be matched by any one supplier let
alone smaller local suppliers thus putting these local 4 Barrier
enterprises at a significant disadvantage in certain
sectors.
Government returns (e.g. taxation) might be even 5 Barrier
lower than company-level returns
The Internet allows online businesses to gain new 6 Barrier
customers from traditional businesses.
Companies with less access to the new technologies, 7 Barrier
Internet investment involves defending market share,
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so that social returns to this investment are lower than

private returns.
Government should encourage the use of a country’s
resources to provide cheaper prices than anywhere else 8 Driver
in the world.
Adoption of e-commerce will result in a significant 9 Driver
reduction of costs
E-commerce will provide a variety of products from 10 Driver
all over the world.
E-commerce could develop the economic activities
and allow users to enjoy the reduction of costs which 12 Driver
could be reinvested in the economy and help
development
4.3 The E-commerce Drivers and Barriers Model (1)
From the above discussion, one could argue that, there are many drivers and barriers for e-
commerce. E-commerce issues (e.g. payment, cost, etc) can be a driver or a barrier for a
country’s economy. Therefore, each and every issue has to be adopted to work nicely with
a country in order to contribute positively in the development of the economy. For example,
removing international trade barriers can be consider as a driver for e-commerce, however,
such action may result in destroying the local companies who are not able to compete with
large and multinational corporations.
The e-commerce Drivers and Barriers Model lists all major e-commerce issues. It is divided
into two sections, one section for barriers and another section for drivers. If the issue is a
barrier for e-commerce in general or in a particular country then the issue should be located
in the barrier section. And the issue will be located in the drivers if it is a driver for e-
commerce. However, from the literature reviewed, all the discussed issues can be drivers
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and/or barriers for e-commerce in developing countries, therefore, the researcher has
located all issues in the middle of the model (see Figure 4.1). This tentative model is novel
and has already been published (Hamed, 2008a, 2008b, 2009)
Figure 4.1 E-Commerce drivers and barriers (1)
Barriers Drivers
Cost
Payment system
Legislation & Regulation
Culture & Religion
Government
Employment
Competition
Traditional business
Economic activities
Infrastructure
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The Drivers and Barriers Model is designed to help the reader to understand the drivers and
barriers issues in a country. The model was mainly designed to list the drivers and barriers
and it is not in any way an attempt to calculate the effect of the issue on the economy. In a
country such as Libya, many issues mentioned in the literature can be found. These issues
are listed in this model and will be investigated in this research. Tables in this chapter give
detailed information of each issue. The research will present a modified version of the
Drivers and Barriers Model at the end of the Chapter Six.
E-Commerce adoption is complicated, its adoption involves economic, social and political
issues, and therefore the issues mentioned in this chapter will be different from one country
to another. A country can be advanced in its level of cost management which can be a
benefit for e-commerce adoption. However, other issues can be dis-benefit for them such as
employment, salaries they pay for the local workers to deliver business, etc. Therefore, this
model consists of two parts, barriers and drivers, If an issue is listed as a barrier for a
particular country, then that issue will effect the adoption of e-commerce. On the other
hand, if the issue is listed as a driver, then the issue can help the adoption of technology in
that country. For example, the cost infrastructure in a developing country will cost an
amount of money; this amount will have to come from the government of that country or
by FDIs. In each case, the amount will affect the spending of that country and probably
minimise other development spends because of this infrastructure project. That will put cost
as a barrier for that country. On the other hand, the reduction of cost which will be achieved
by the adoption of e-commerce can be a driver for that country. However, this model is not
aiming to provide any quantitative assessments. It is used as a map for the research and a
106
guide for examining the main drivers and barriers issues. Arrows on the model explain that
the issue can move from one side to the other.
4.5 Summary
There are many e-commerce issues that can count as drivers or barriers in a country. These
issues are cost, payment, legislation and regulation, culture and religion, government,
employment, competition, traditional business, economic activities, knowledge of e-
commerce, infrastructure and security. Each of these issues can have its effect on a
country’s economy. For the country to guarantee a success of e-commerce adoption, its
government has to make sure that it has dealt with all barriers and benefits of the drivers of
each issue. These issues will be examined in Libya and discussed in the next chapter.
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Chapter five: Research methods
108
Chapter five
Research methods
109
5.1 Introduction......................................................................................................................................... 111

5.2 Research Purpose................................................................................................................................ 112
5.3 Research Design .................................................................................................................................. 113
5.3.1 Qualitative and Quantitative Methods ........................................................................................... 115
5.4 The Adopted Research Methodology ................................................................................................ 117
5.5 Secondary Data ................................................................................................................................... 119
5.6 Primary Data ....................................................................................................................................... 123
5.6.1 Interview ........................................................................................................................................... 124
5.6.2 Questionnaire .................................................................................................................................... 133
5.7 Method of Data Analysis .................................................................................................................... 138
5.7.1 Qualitative Data Analysis.................................................................................................................. 139
5.7.2 Quantitative Data Analysis................................................................................................................ 141
5.8 Ethical Considerations........................................................................................................................ 142
5.9 Summary.............................................................................................................................................. 143
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5.1 Introduction
This chapter describes the research methodology employed in this research study. The
generation of data and information relating to the research topic is explained and
rationalised according to the research aim and objectives. The purpose behind this research
was to ascertain the effect of using e-commerce in the economic development of
developing countries such as Libya, where very few or no earlier studies have been
conducted.
The research process is described in terms of a critical analysis of relevant research
approaches. A multi-method paradigm was selected to observe social reality and to develop
knowledge through the testing of the data generated. The research design and methods are
described aligned to the research aims and objectives. Primary and secondary data
collection methods were explored, and the interview and questionnaire approaches are
clarified. This chapter also defines the interview sample and data analysis which involved
the use of computerized software packages (NVivo7, Excel) to store and organise the data
gathered.
111
5.2 Research Purpose

Literature evidences the many approaches appropriate for research studies. Saunders et al.,
(2003) described the research purpose as being exploratory, descriptive, analytical or
predictive. Collis and Hussey (2003) explained that exploratory research is conducted into a
research problem or issue when there are very few or no earlier studies to which
information can be referred. Robson (2002) defined exploratory research as a valuable
means of finding out what is happening to seek new insights; to ask questions and to assess
phenomena in a new light. The aim of this type of study, according to Collis and Hussey
(2003), is to look for patterns, ideas or hypotheses, rather then testing or confirming
hypothesis.
Saunders et al., (2003) described descriptive research as phenomena because it is used to
identify and obtain information on the characteristics of a particular problem or issue.
Robson (2002) states that the objective of descriptive research is to portray an accurate
profile of person, events, or situations, however Saunders et al., (2003) argued that this may
either be an extension of, or a forerunner to, a piece of exploratory research. He suggests
that it is necessary to have a clear picture of the phenomena on which the researcher wishes
to collect data prior to the collection of the data. The data collected, according to Collis and
Hussey (2003), is often quantitative using statistical techniques that go further in examining
a problem than exploratory research.
Analytical or explanatory research, as a continuation of descriptive research, goes beyond
merely describing the characteristics, to analysing and explaining why or how it is
112
happening (Collis and Hussey, 2003). The emphasis here is on studying a situation or a
problem in order to explain the relationship between variables (Saunders et al., 2003).
Predictive research goes even further than explanatory research. The latter establishes an
explanation for what is happening in a particular situation, whereas the former forecasts the
likelihood of a similar situation occurring elsewhere. Predictive research attempts to
generalise from the analysis by predicting certain phenomena on the basis of hypothesised,
general relationships. Thus the situation to a problem in a particular study will be
applicable to similar problems elsewhere, if the predictive research can provide a valid,
robust solution based on a clear understanding of the relevant causes (Collis and Hussey,
2003).
E-commerce in Libya is still in its early stages as, to the researcher’s best knowledge, there
are no earlier studies in this area. Therefore a study would investigate the e-commerce
situation in Libya and explore what, if any, steps the country should take to adopt such
technology (Saunders et al., 2003). As a consequence, the findings may be significant to
other developing countries with a similar e-commerce situation (Collis and Hussey, 2003).
5.3 Research Design

The literature identifies a number of interpretations of research design. Set out below are
the most significant and recognised views. Research design is the science of planning
procedures for conducting studies so as to get the most valid findings (Vogt, 1993).
Saunders et al., (2003) referred to this stage as the general plan that determines how a
researcher will attempt to achieve the research aim. In other words, the research design is
the plan or strategy adopted for linking the theoretical research problem to relevant and
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practicable empirical research that is conducted to achieve the research aim. In a similar
vein Oppenheim (1992) defines research design as:
The basic plan or strategy of the research, and the logic behind it, which
will make it possible and valid to draw more general conclusions from it
(P 212).
Thus, the research design should tell how the sample will be drawn, what sub-groups it
must contain, what comparisons need to be measured, and how these measures will be
related to external events. Research design is concerned with enabling a problem to be
researchable by setting up a study in a way that will produce specific answers to specific
questions. Researchers need to assess their specific research design before they start their
research. However, it is argued that researchers often fail to give adequate attention to
research design issues, possibly because of their inability to identify design as their first, or
as their most important, step in developing a research proposal (Hakim, 1987). Collis and
Hussey, (2003) suggest that the first step in research design is to identify a research
problem or issue. Identifying the research problem is always an exploratory and iterative
phase in the research.
There are two significant research methods that need to be distinguished, the deductive
method and the inductive method. Deductive research is a study in which a conceptual and
theoretical structure is developed and then tested by empirical observation; thus particular
instances are deduced from general inferences. For this reason, the deductive method is
referred to as moving from the general to the particular (Johnson and Christensen, 2004).
Inductive research is a study in which theory is developed from the observation of
empirical reality; thus general inferences are induced from particular instances, which is the
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reverse of the deductive method. Since it involves moving from individual observation to
statement of general patterns or laws, it is referred to as moving from the specific to general
(Collis and Hussey, 2003). More specifically Ghauri and Gronhaug (2002) argue that the
deductive approach as a method is based on logic, whereas induction is based on empirical
evidence. They further explain the difference between these two approaches. Deduction is
drawing the conclusion out of logical steps and reasons regardless whether it is true in
reality or not. Induction on the other hand does the opposite, it moves from assumptions to
a conclusion.
5.3.1 Qualitative and Quantitative Methods

The literature demonstrates the diversity of methodologies and research instruments
available that can help with the generation of data and information relating to particular
research topics. Patton (1990) indicated that the first undertaking is to decide which
approach best identifies most appropriate solutions from which to draw suitable
conclusions relating to the issues under investigation.
The quantitative approach may be defined as an interdisciplinary field that uses a multi-
method approach to research. It refers to the understanding of human experience using
numbers and statistics, examples, experiments, correlation studies by surveys and
standardised observational protocols, simulations, supportive materials (Janesick, 1998;
Corbetta, 2003). Johnson and Christensen (2004) argue that the quantitative research
approach focuses on the deductive component of the scientific method by focusing
generally on hypothesis testing and theory testing. Quantitative data are not usually
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abstract, but hard and reliable; they measure tangible, countable, sensate features of the
world (Bouma and Atkinson, 1999; Naoum, 1999).
This can be compared to qualitative research that Creswell (1994) argued is an inquiry
process of understanding a social or human problem, based on building a complex, holistic
picture formed with words, reporting detailed views of informants, and conducted in a
natural setting. Qualitative research is described as ‘subjective’ in nature, emphasising the
meanings, experiences, description, and so on (Naoum, 1999).
The differences between qualitative and quantitative research have been explained by
number of authors (Maxwell, 1998; Thomas, 2003; Corbetta, 2003). Corbetta (2003)
demonstrated that qualitative research is open and interactive and observation precedes
theory whereas quantitative research is structured and theory precedes observation.
Corbetta (2003) has identified different issues between the qualitative and quantitative
research in the nature of data. He argued that, in quantitative research the data it is hard,
objective and standardized, on the other hand, in qualitative research the data it is soft, rich
and deep.
More recently, however, the competing paradigms of quantitative and qualitative research
become almost working partners in some social research. Many researchers advocate a
pragmatic position as it is recognised that both quantitative and qualitative research are
very important and can often be mixed in single research studies (Patton, 1990; Naoum,
1999). The exact mixture that is considered appropriate will depend on the research
questions and the situational and practical issues facing a researcher (Johnson and
Christensen, 2004). Thus this research study aims to collect multiple sets of data using
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different research methods in such a way that the resulting mixture or combination has
complementary strengths and non-overlapping weaknesses (Brewer and Hunter, 1989;
Johnson and Turner, 2002).
5.4 The Adopted Research Methodology

There is neither a fast rule to selecting research methods nor best research method as the
use of each research method depends on the form of research question, the research
objectives and contextual situation (Yin, 2003). The selection of the most suitable research
method depends largely on the intention of the research objectives and the type of data
needed for the research. Combining both quantitative and qualitative research methods has
proven to be more powerful than a single approach (Stewart and Cash, 2006) and very
effective (Saunders et al., 2003). A mixed approach is a process of using more than one
form of research method to test a hypothesis (Thomas, 2003). However due to the context
of the research study this approach offers researchers a great deal of flexibility; whereby
theories can be developed qualitatively and tested quantitatively or vice versa. The main
aim of using a mixed method is to improve the reliability and validity of the research
outcomes. Due to the broad scope of this study and the commercial context of the research,
a wide range of research techniques was adopted to achieve the research aim and
objectives.
For this research study a mixed research approach was adopted to achieve the study’s aim
and objectives and to maximise the benefit of both methods. From a qualitative stand point
the research conducted semi-structured interviews and a closed questionnaire from a
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quantitative aspect. In other words, a qualitative research study and a quantitative research
study were conducted either concurrently or sequentially.
Both of these methods require data collection involving primary and secondary data
collection methods. Primary sources include questionnaires, observation and interviews.
Secondary sources include books, journals, government publications and survey, world
statistics and so on (Chisnall, 1997; Saunders et al., 2003). All sources are examined more
fully in Sections 5.6 and 5.7.
Table 5.1 summarises the research methods used in this study along with each objective. It
explains the technique(s) used for collecting the information and the activities the
researcher undertook and shows the outcome of each activity. For example, for developing
the implementation plan for e-commerce (objective 5), the researcher used a mixed
qualitative and quantitative approach. This objective was achieved by collecting secondary
data (from books, journals, reports, CDs and websites) and primary data (from interviews
and questionnaire). The outcome of objective 5 was the plan of action for e-commerce
adoption which is demonstrated in Chapter seven.
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Table 5.1 research method techniques and outcomes
Research
Aim and objectives Techniques Activities Outcomes
method
1. Review economic Mixed Secondary Books, Chapter

development literature approach data Journals, two
Reports,
CDs,
website
2. Review e-commerce Mixed Secondary Books, Chapter
literature approach data Journals, three
Reports,
CDs,
website
3. Develop theoretical Mixed Secondary Books, Chapter
framework approach data Journals, four
Reports,
CDs,
website
4. Investigate drivers and Mixed Primary Interview, Chapter
barriers in Libya approach data Questionnair six
e
5. Develop implementation Mixed Secondary/ Books, Chapter
plan for E-Commerce approach primary Journals, seven
data Reports,
CDs,
website,
interview,
questionnaire
6. Develop model to assist E- Mixed Secondary/ Books, Chapter
Commerce approach primary Journals, seven
data Reports,
CDs,
website,
interview,
questionnaire
The interview and questionnaire questions were linked directly to the theoretical framework
developed in chapter four (more details on questionnaire and interview design can be seen
in 5.6.1 and 5.6.2).
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Tables 5.2 and 10.13 list all questions and link them with the theoretical framework. For
example in table 5.2 all interview issues and questions are listed. Interviewees were asked
the question ‘do you know the term e-commerce?’ The idea behind this question is to
demonstrate the interviewee’s understanding of the term e-commerce and to ascertain
whether local businesses are aware of the threat of e-commerce. Therefore, in the same
table (table 5.2) the mark ● will be found under the columns headed ‘Knowledge’ and
‘Traditional business’ issues. The same method applies for all questionnaire and interview
question. Questionnaire questions linked to e-commerce issues can be found in table 10.13
(appendices 10.5).
Table 5.2 , Interview questions linked to E-Commerce issues
infrastructure
Trad-business
employment
government
competition
Knowledge
legislations
economic
payment
security
culture
cost
Interview questions
Do you know the term e-
commerce? ● ●
Does your company have a
strategy for electronic
commerce? ● ● ● ● ● ● ● ● ● ● ●
Which communication do
you use? ● ● ● ● ● ● ●
Does your business engaged

in electronic commerce ? ● ● ● ● ● ● ● ● ● ● ● ●
If you implementing e-
commerce, what is the
advantages / reasons of
implementing e-commerce?
What is the main befit to your
business? ● ● ● ● ● ● ● ● ●
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If you are not implementing

e-commerce, what is the
disadvantages/reason of not
implementing? Why you are
not involved? ● ● ● ● ● ● ● ● ●
If you don’t have a clear
strategy for e-commerce at
present, is it likely to become
important in 2-3 years? ● ● ● ●
How many products and
services does your business
offer? ● ● ● ● ●
How do you deliver your
products and services to
consumer/client ● ● ● ● ●
What type of payment do you
accept ● ● ● ● ●
Do you update your web if
you have one, or does the
third party doing for you? ● ● ● ● ●
What is the barriers of e-
commerce in Libya ● ● ● ● ● ● ● ● ● ● ● ●
What is the drivers of e-
commerce in Libya ● ● ● ● ● ● ● ● ● ● ● ●
What is the threat to the
traditional commerce ● ● ● ● ●
What are the pioneers to e-
commerce in Libya
Any other comments
5.5 Secondary Data

According to Saunders et al., (2003), secondary data is information that has been
previously gathered for some purpose other than the current research project. Saunders et
al., (2003) stated that few researchers consider the possibility of re-analysing data that have
already been collected for some other purpose. He explained that secondary data includes
both raw data and unpublished summaries. For example, government departments
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undertake surveys and publish official statistics covering social, demographic and
economic topics.
There are two types of secondary data: internal and external. As regards internal secondary
data, Chisnall (1997) maintained that the answers to many problems lie within
organisational documents; he added that many companies do not make full enough use of
the information that it regularly generates. External sources of data include statistics and
reports issued by governments, trade associations, and other reputable organisations.
Additionally, information is frequently circulated from other sources, such as trade
directories to provide further information. Chisnall (1997) further states that electronic
access to data has revolutionised secondary sourcing, for example online services and CD-
ROMs provide practically instant access to sophisticated information from across the
world.
Malhotra (2004) and Wilson (2003) argued that the main advantages of using secondary
data are the cost and time economies they offer the researcher. The collection of secondary
data enables researchers to interpret primary data with more insight that might lead to other
discoveries, and provide a source of comparative data to check on the reliability of data
gathered from primary research. However, Saunders et al., (2003) pointed out there are
disadvantages to secondary data collection. Data collected may not match the needs of the
phenomena under investigation and there may be difficulty in obtaining or collecting
relevant data that is specifically related to issues involved.
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For this research study secondary research represented a critical review of existing
literature on the subject area. Textbooks from libraries were used for this purpose. As the
subject area was one of the e-commerce, technology, and economic development the
researcher recognised the need to look at the most recent literature available. For this
reason journals and e-journals were used to gain knowledge of the current views and
developments. Further research was conducted through Internet access for up-to-date
information. The researcher acknowledged that consideration must be given to ascertaining
the validity and source of knowledge. Secondary research enabled the researcher to
compare the already existing theories and views on e-commerce, and place these in relation
to the content of the interviews and questionnaires. Bell (2001) states that secondary
research assists the researcher in developing questions to be answered as part of a project.
Through analysis of the acquired literature, the researcher was able to develop particular
questions where clarification would be required and through which answers would be
sought through primary research.
5.6 Primary Data

According to Collis and Hussey (2003) original or primary data can be obtained and
collected through a variety of ways. These may include observation, interviews and
questionnaires, conversation and discourse relative to a specific research study. Ghauri and
Gronhaug (2002) maintained that a significant advantage of primary data being collected is
that it enables a focus on the specific requirements of the research. For example through
questions requiring particular responses, such as opinions and attitudes, or observed
behaviours, questions should be answered by the chosen sample of people who are actually
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involved in the issue that the researcher is working on. For this research study, the chosen
sample of people will reflect Internet users. However, other authors (Corbetta, 2003; Yin,
2004) have mentioned some disadvantages of primary data. Such as the time required for
collecting the data, and the difficulty of access in terms of finding a target group who are
willing to cooperate. It is often the case that more time is needed than was expected, the
response rate may be lower than anticipated (Collis and Hussey, 2003; Malhotra, 2004).
They are totally dependent on the willingness and ability of the respondents. The chances
of obtaining data from a target group are likely to be very low in most cases, especially if
there are issues of high sensitivity. It is important that the researcher selects suitable
methods and procedures for data analysis to avoid risking the reliability and applicability of
the research.
Ghauri and Gronhaug, (2002) described interviews and questionnaires as effective tools to
gather opinions, attitudes and descriptions. Additionally, they generate real reaction and/or
cause-and-effect relationships. Such research methods are discussed next.
5.6.1 Interview
There are several advantages of using the interview approach. One advantage is that
interviews are flexible; the interviewer can adapt the situation to each subject. Another
advantage is the interview may also result in more accurate and honest responses since the
interviewer can explain and clarify both the purpose of the research and individual
questions. A third advantage is that the interviewer can follow up on incomplete or unclear
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responses by asking additional probing questions (Robson, 2002; Miller and Brewer, 2003;
Gillham, 2005). A further advantage is high response rate. Most people will agree to be
interviewed. People are often more confident of their speaking ability than their writing
ability (Burns, 2000).
Three styles of conducting interviews that were considered are: un-structured interviews,
semi-structured interviews and structured interviews. Formats of interviews vary, from the
highly-structured type where questions are presented and asked in a fixed form and
sequence, to the open or non-directed interview (Whipp, 1998; Saunders et al., 2003).
These approaches are discussed below.
Unstructured interviews are a form of interview that uses ‘open-ended’ or ‘open’ questions
so that the researcher can see in what direction the interviewees take things in their
response (Naoum, 1999). Stewart and Cash (2006) suggests that an unstructured interview
is most appropriate when the information area is extremely broad. This means that an
unstructured interview gives the interviewer unlimited freedom to probe into answers and
to adapt to different interviewees and situations. However unstructured interviews require
considerable interviewer skill and are difficult to replicate from one interview to another.
The highly-scheduled structured interview is the most thoroughly planned and structured.
All questions and answer options are stated in identical words to each interviewee who then
picks answers from those provided. There is no straying from the schedule by either party.
Highly-scheduled structured interviews are the easiest to conduct, record, tabulate, and
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replicate, however respondents have no chance to explain, amplify, qualify, or question
answer options (Stewart and Cash, 2006).
A semi-structured interview is more formal than an unstructured interview in that there are
a number of specific topics around which to build the interview (Naoum, 1999). Semi-
structured interviews, or focused interviews, as Merton and Kendal (1946) named them,
have four distinguishing characteristics:
 They take place with respondents known to have been involved in a particular
experience.
 They refer to situations that have been analysed prior to the interview.
 They proceed on the basis of an interview guide specifying topics related to the
research hypothesis.
 They are focused on the respondents’ experience regarding the situations under
study.
In this study a semi-structured interview approach that consisted of both structured and
unstructured techniques (Saunders et al., 2003) was employed. Interviews were conducted
to gather valid and reliable data that are relevant to research questions and objectives. A
researcher develops a list of themes and questions to be covered, although this may vary
from interview to interview. Thus a researcher may omit some questions in particular
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interviews, given the specific organisational context, which is encountered in relation to the
research topic. Robson (2000) summarised the process as:
The interviewer has worked out in advance the main areas he/she wishes to
cover, but is free to vary the exact wording of questions as well as their
ordering. So, if an interviewee starts to cover a new area in response to a
question, then the interviewer keeps the flow going by asking relevant
questions from his/her list of topics. Any missing topics are returned to at
the end of the interview (p90).
The researcher prepared fifteen questions on e-commerce and economic development.
These questions were presented to all interviewees. However, because of the different
backgrounds of the interviewees, follow-up questions were focused on the specific contexts
of individual interviewees. For example, during the interview with the Economic Ministry
Under-secretary, the researcher focused more on the effect of e-commerce in Libya’s
economic activities rather than paying attention to the payment system or other technical
issues that are not the economic ministry’s responsibilities. However, interviewees were
encouraged to add their opinions on other issues that were not related to their core
responsibilities.
5.6.1.1 Interview Recording and Transcription

Note-taking increases the interviewer’s attention to what is being said. Taking notes
reduces concerns the interviewer may have about any technical problems with recording
equipment at a critical moment (Stewart and Cash, 2006). However note-taking has some
disadvantages. The interviewer can rarely take notes fast enough to record exactly what was
said, there also can be difficulties concentrating on questions and answers. Note-taking may
hamper the flow of information because interviewees may become fearful or curious about
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what the interviewer is writing (Saunders et al., 2003). Such problems did not occur during
this research because the researcher paid attention more to the interviewees’ comments and
relied more on the tape recording.
Additionally, the recording of interviews provides a permanent record and also allows the
interviewer to concentrate on the interview. This enables the interviewer and interviewee to
relax and focus on what is being said and implied. Furthermore a tape recorder may pick up
answers that were inaudible at the time (Robson, 2003; Stewart and Cash, 2006). However,
tapes provide permanent, undeniable records that threaten many people with unknown
future consequences. It also takes a great deal of time to review a lengthy tape to locate
facts, reactions, and ideal quotes while it may take only seconds to locate the same material
in written notes (Stewart and Cash, 2006).
The researcher has used a combination of tape recording and note-taking to maximise the
validity of data collection and minimise the weaknesses of both methods. A digital audio
recorder was used through all interviews and note-taking was used to collect observable
and nonverbal information. The interviewer experienced none of the problems mentioned
above because the researcher checked the tape recorder before each interview and a mobile
phone with a recording facility was used along with the tape recorder.
5.6.1.2 Interview Sample

Although the research question and objectives are about e-commerce and economic
development in Libya, difficulties were experienced in terms of time and cost due to the
duality of the research activities between Libya and the UK. To overcome this problem a
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sample of Libyan managers, decision-makers and employees with different work
experiences acted as representatives of the Libyan context. The number of the sample is
relatively small (15 interviewees), and this is considered as one of the limitations. A major
advantage to be obtained from this sample is that the participants are key decision-makers
in e-commerce from different areas of the government and commerce.
The key decision-makers for e-commerce in Libya were identified. The researcher
reviewed the literature of e-commerce and economic development in order to be able to
make such identifications. By reviewing literature, the researcher was able to identify a
number of issues that are drivers and barriers for e-commerce (see Section 4.2). Therefore
the researcher approached the responsible authority for each issue and requested permission
for the interview. Each interviewee’s position, organisation, and the reason why they were
interviewed are listed below:
 Economic Ministry: The Economic Ministry is the responsible government body
for controlling all economic activities in Libya. The Economic Ministry has also
been asked by the Libyan government to be responsible for designing and putting in
place the regulation for e-commerce and its activities in order to avoid and/or
control shifting economic activities outside Libya’s economy. A two-hour interview
with the Economic Ministry Undersecretary was undertaken.
 Central Bank of Libya: Central Bank of the Libya is the highest authority for
banking and payment systems in the country. The bank is responsible for all
payment activities and controlling bank interest rates and money transfers including
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international payments. The bank has launched a National Payment System which is
aiming to provide an electronic payment system to all banks operating in Libya as
well as providing a point-of-sale system for businesses and organisations. An
interview was held with a National Payment System technical department manager.
The interviewee was suggested by the Central Bank of Libya and claimed to be the
most suitable person to discuss and provide details of the project.
 Libyan Postal and Telecommunication Company (LPTC): The Libyan Postal
and Telecommunication Company is the only telecommunications infrastructure
company in the country, the company is responsible for all fixed-line operation in
the country as well as postal services. LPTC is the only responsible organisation for
ICT infrastructure in the country. An interview was held with the Chairman of the
Automation Committee. The interviewee is responsible for automating the LPTC
services and improving the country’s telecommunications infrastructure.
 Libyan Telecommunication Technology (LTT): 100 percent of LTT shares are
owned by the LPTC. It is the only authorised Internet service provider in the
country. The company provides Internet connections, hosting, Libyan domain
names (LY) registration and database centre for government bodies. An interview
was held with a department-manager. The interviewee was appointed by the
company to be the most suitable person to provide information about the company
and its services.
 Libyanna: Libyanna is 100 percent owned by LPTC. It is one of the two mobile
phone companies in Libya; Libyanna is the only company that provides Internet
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connection over a mobile phone network in the country. An interview was held with
a department manager, the interviewee was introduced by the company’s
management board and claimed to be the most suitable person to provide
information about the organisation.
 Libyan Commercial Bank. Libyan Commercial Bank is the oldest operating bank
in Libya, the bank provides banking services to private and public organisations.
Also, it is one of the banks that the Central Bank of Libya is aiming to link within
the National Payment System. An interview was held with the operations
department manager. The interviewee was introduced by the bank and claimed to be
the most suitable person to provide information about the bank activities and its
involvement with the National Payment System.
Other interviews were held within the private sector in order to understand the real situation
regarding Internet use in the country and in their organisations. The researcher interviewed
people from different backgrounds and at different managerial levels, for example:
 An interview was held with the Chairman of BA Group. BA Group is a group of
four companies providing services in oil, technical, constructions and financial
services in Libya. The company uses the Internet in its day to day business.
 Interviews were held with three different Internet café managers. Internet cafés are
the main places for using the Internet in Libya.
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 Managers of Tourism Companies, the companies provide tourism services to non-
Libyan tourists.
 A project manager in a non-Libyan oil company. The company is a branch of an
international company and provides services in the oil sector in Libya.
 A Business Development Manager of a financial company. The company is a
branch of an international company and provides financial services over the Internet
to its clients.
Table 5.3 lists all interviewees and contains each organisation’s name. The
abbreviations used as follows:
Table 5.3: List of organisation interviewed
Name of the organisation
MOC Ministry of Economy, Libyan government

Organisation of postal and telecommunication company, Libyan government
OPTC
company
LTT Libyan telecommunication technology, Libyan government company
LIB Libyanna Mobile company, Libyan government company
LCB Libyan Commercial bank,
CBL Central Bank of Libya,
BA Group, a group of companies in construction, financial and oil
BA
companies
CI Concord investment
OCC Oil and construction company
AW Al Wesam Internet Café
AR Al Reiad Internet Café
AL Al-Mukhtar Internet Café
OC Oil Company
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Interviews were held in person rather than by telephone, allowing more flexibility for both
interviewer and interviewees as well as for better observation of the body language for
certain expressions and attitudes. The format of the questions involved in the interviews
were open-ended, since they allowed for the opportunity to explore, to obtain more detailed
answers, freedom and spontaneity of answers. Moreover, open-ended questions have a
much less biased influence on response than close questions (Malhotra, 2004).
Interviewees were given a brief outline and explanation of the research and its purpose. In
this way interviewees sensed their importance for the purposes of the study and this helped
to achieve more interaction. Interviewees gave informed consent. Permission was obtained
for using tape-recording devices before the interviews took place. The length of interviews
varied according to availability and content but generally they were of one hour’s duration.
All interviewees were assured of the anonymity and confidentiality of the data gathered.
5.6.2 Questionnaire
A questionnaire is a self-reporting data collection instrument that each research respondent
fills out as part of a research study. Researchers use questionnaires so that they can obtain
information about the thoughts, feelings, attitudes, beliefs, values, perceptions, personality,
and behavioural intentions of research participants (Johnson and Christensen, 2004). In
other words, the researcher attempts to measure many different kinds of characteristic using
questionnaires (Bell, 2001).
133
Collis and Hussey (2003) stated that a questionnaire is a list of carefully structured
questions, chosen after considerable pilot testing, with a view to eliciting reliable responses
from a chosen sample. Most questions are either open or closed. Oppenheim (2001) stated
that a closed question is one in which the respondents are offered a choice of alternative
replies. They may be asked to tick or underline their chosen answer(s) in a written
questionnaire. Open- or free- response questions are not followed by any kind of choice,
and the answers have to be recorded in full. Free-response questions are often easy to ask,
difficult to answer, and still more difficult to analyse. Closed questions are easier and
quicker to answer; they require no writing, and quantification is straight forward. This often
means that more questions can be asked within a given length of time and that more can be
accomplished with a given sum of money. Disadvantages of closed questions are the loss of
spontaneity and expansiveness (Oppenheim, 2001; Robson, 2002). Oppenheim (2001)
added that a questionnaire may also contain check lists, attitudinal scales, projective
techniques, rating scales and a variety of other research methods. In this study, the
researcher has adopted a questionnaire comprising closed questions. However, in order to
overcome some of the disadvantages, the questionnaire format has allowed candidates to
add their views and opinions if these were not listed in the questionnaire questions.
Collis and Hussey (2003) emphasised a number of advantages that can be obtained by
utilising a questionnaire compared to interviews for collecting primary data. For example
they are less time-consuming, a larger sample can be involved, and they are less costly.
Saunders et al., (2003) argued that if a questionnaire is correctly worded, it normally does
not require a highly-skilled researcher to administer it, unlike interviewing. Other
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advantages put forward by Babbie (2001) suggested that using questionnaires allows the
production of descriptive statistics that are representative of the whole study population. In
addition, it facilitated replications and comparative studies.
However, a questionnaire is completely dependent on the respondents’ responses (Ghauri
and Gronhaug, 2002). Also answers may not provide suitable responses that reflect the
research focus. The reason could be that it is a set of specific questions, mostly with limited
answers. In other words if the questions are likely to be understood differently by different
respondents it could be argued that a questionnaire has failed to collect primary data
required for the research.
5.6.2.1 Questionnaire Design

Saunders et al., (2003) attributed the validity and reliability of data collected to the rate of
response, to the design of the questionnaire, its structure and the rigour of the pilot testing.
Malhotra (2004) argued that the great weakness of questionnaire design is lack of theory,
because there are no specific or strict steps to follow for designing a questionnaire, or
scientific principles that guarantee a perfect and ideal questionnaire. The questionnaire
design adopted consisted of a number of steps starting with defining the research
objectives, selection of an appropriate format and design layout, pilot testing and then
implementing the questionnaire (Wilson, 2003; Saunders et al., 2003).
Questionnaire design should not be taken lightly, as improper design can

lead to inaccurate information, incomplete data and may result in research
moneys being wasted
(Wilson, 2003, P173).
135
The design format adopted involved open and closed questions using simple language that
enabled the questionnaire to be completed in a short time. Additionally, from the
researcher’s point of view closed questions were easy to process and analyse. Questions
were designed according to the types suggested by Saunders et al., (2003) and included list
questions, category questions, closed questions, scale questions and open-ended questions
with sufficient space for respondents to add additional data. The questionnaire was
designed in sub-sections to be easy for answering. For example, one section includes all
Internet technical issues, another covers e-commerce issues.
The questionnaire was designed and distributed after the interviews and observations took
place. Analysis of the interview data and observation issues identified the main issues.
These were compared to the issues discussed in the literature review. Once these issues
were investigated and explored, the researcher then designed the questionnaire.
5.6.2.2 Pilot Testing

A pilot test of the research questionnaire was conducted in order to refine it and clarify that
respondents had no problems answering the questions, and also to ascertain that the right
data was being collected. Moreover, piloting offers a good assessment for some important
issues the researcher may be concerned about such as level of difficulty, willingness to
answer sensitive questions and the time it takes to answer all questions (Brace, 2004;
Ghauri and Gronhaug, 2002; Saunders et al., 2003).
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The questionnaire was piloted among a small but similar group of the respondents, in both
Arabic and English. The aim was to double check the issues discussed above had been
addressed, and to confirm the data collected was appropriate to the research questions. This
pilot test resulted in many important positive points and comments which led to the
revision of the questionnaire. For example the questionnaires were restructured into
categories in line with the research objectives. Additionally, two questions were rephrased
for greater clarity and to remove ambiguity.
5.6.2.3 Questionnaire Administration and Survey Sample
Saunders et al., (2003) explained that after a questionnaire is designed and pilot tested it is
ready to be used for data collection by distributing it among the target sample when
problems of access should be taken into consideration. This stage is called `questionnaire
administration` the main purpose of which is to guarantee the greatest number of
respondents, in other words to maximise the response rate. Saunders et al., (2003) referred
to a number of methods of questionnaire distribution, which may be adopted in a research
study, online questionnaire, postal questionnaire, telephone questionnaire and personal
delivery and collection questionnaire or some times called face-to-face questionnaire. For
this research study the researcher adopted face-to-face questionnaire because it guaranteed
the highest rate of response (83.3 percent response rate in this research) (Collis and Hussey,
2003).
Saunders et al., (2003) identified several factors that should be taken into consideration in
order to get the best results. A population is a set of persons or objectives that possess at
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least one common characteristic (Bailey, 1994). Neuman (1997) argued that a population is
an abstract concept because one can never truly freeze a population to measure it. This
research targeted a sample of one hundred and fifty respondents. These candidates were
Internet users from different backgrounds (managers, employees, self-employed and
others). The respondents were selected randomly from Internet Cafés across Tripoli. First
the researcher selected Internet cafés from a list, three Internet cafes were selected from 25
Internet cafés listed. Then the researcher approached the Internet Café managers to seek
permission to do the questionnaire. Once the permission was given the researcher visited
the cafés a number of times such that users of the Internet Cafés could complete the
questionnaire in the researcher’s presence. Each questionnaire respondent spent between 15
to 20 minutes completing the questionnaire with the researcher on hand to answer queries.
However, as expected, most of the questionnaire respondents were students because
Libya’s younger generation account for 50 to 60 percent of the total population (Country
Review, 2007).
5.7 Method of Data Analysis

The data analysis method depends on whether the data collected is quantitative or
qualitative. Data need to be analysed to achieve the research results (Ghauri and Gronhaug,
2002; Collies and Hussey, 2003). The literature acknowledged that the research approach
referred to the systematic, focused and orderly collection of data for the purpose of
obtaining information from them, to answer research problems or questions. In this study,
therefore, the methods of data analysis involved both quantitative and qualitative
approaches. For analysing the quantitative data, this approach involved collecting and
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analysing numerical data and applying statistical tests, which concentrates on measuring
phenomena using computerised quantitative software, such as Microsoft Excel. However,
the qualitative approach is more subjective in nature and focuses on interpreting and
examining perceptions and behaviours in order to gain a deeper understanding of social and
human activities. Analysis of the qualitative data involved transcription of audio-taped
interviews as recommended (Johnson and Christensen, 2004). NVivo, a qualitative
software package, was used to segment, code and develop categories of the data analysed
(Berger, 2006). The analysis of the two methods is explained below
5.7.1 Qualitative Data Analysis
According to Marshall and Rossman (1989)
Qualitative data analysis is a search for general statements about

relationships among categories of data.
(P112)
Coffy and Atkinson (1996) mentioned that there are a variety of suitable analytical
approaches to qualitative research and many of them can be aided with computer software.
On the other hand it would be wrong for qualitative research to allow the available software
to drive the general research strategy (Berger, 2006). At the core of the process of
qualitative data analysis is the decision to analyse data manually or with the aid of a
software computer package (e.g. QSR NVivo 7).
NVivo was selected to collate the range of qualitative data collected. It is suitable for
dealing with large volumes of non-numerical data such as interviews, documents and
transcripts and helps to manage and analyse data gathered (Berger, 2006). Myers (1997)
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emphasises that qualitative analysis software packages are useful for organising the
indexing, coding and categorising of data, but it is the researcher who must apply a
development strategy to formulate the analysis. Its rationale can be extended to the
mapping of the software facilities and characteristics against the research approach,
methods used and type of data that the research is generating. The important issue is that
the software can not perform data analysis, this is driven by the researcher. For example,
the researcher will define what analytical issues are to be explored, and which ideas are
important and the most appropriate mode of representation.
Seale (2000) pointed out there are advantages and disadvantages of using software
packages in qualitative analysis. Advantages included speed of handling the large volumes
of data, facilitating iterative enquiries and help with sampling. An early criticism of such
software management methods suggests that they can be influenced by grounded theory,
and as such may push analysis in one direction with the result that some aspects of analysis
might be a product of the technology used. However, the sophistication of Nvivo software
means that it is not connected to any one analytical approach (Richard, 2002). Additionally
software management tools are able to provide speed and flexibility, and the researcher was
aware that they also have the potential to restrict and constrain the handling of different
data types through their coding, and linking processes (Berger, 2006). Additionally, NVivo
enables the researcher to return to, retrieve and maintain the contextual integrity of the data,
whilst facilitating editing activities without disturbing or invalidating existing coding and
linking (Berger, 2006). Thus it offers both loose and creative structures that are unaffected
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by editing the research to apply perceptions, interpretations and theory development
appropriate to the research study.
All interview data were imported into the NVivo software after it had been translated from
Arabic into English and transcribed. The researcher used a free node technique to analyse
the qualitative data of the research. For example for a question ‘Do you use E-Commerce in
your organisation?’ a free node called ‘E-Commerce use’ was created. As the researcher
used a semi-structured interview, a second level of nodes was created according to the sub-
questions that were asked in the interview. A third level of node was created in association
of two issues that were collected in the interview. For example, a free node called ‘E-
commerce drivers’ was created from number of different free nodes (payment, law, type of
connection, etc.
5.7.2 Quantitative Data Analysis
Quantitative analysis methods for the questionnaire data are largely widespread, probably
because their standardization makes the collection and analysis of data more efficient
(especially when using dedicated software tools) and because the subsequent possibility to
conduct statistical analyses on large samples allows conclusions to be drawn with a well
defined level of certainty and confidence. The researcher used Excel spreadsheets for this
research project to present and analyse the data gathered from the questionnaires. In this
way the use of tables and diagrams was effective to present this data in the most appropriate
way such as presenting the data in numerical form e.g. percentages.
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5.8 Ethical Considerations

Research ethics refers to the appropriateness of research behaviour in relation to the rights
of those who become the subject of research work or are affected by the work. Ethical
issues are likely to appear in all the research stages and more particularly appear in the first
stages of the research. This is especially relevant with qualitative research rather than
quantitative research of primary data collection, which involve questionnaires and
interviews as collection methods. In this case there will be a relationship between a
researcher and respondents. The task a researcher faces in this stage is to convince
participants to answer as many as possible of the questions or interview’s questions
willingly, and at the same time respecting her or his refusal to answer (Ghauri and
Gronhaug, 2002; Saunders et al., 2003). That is, a participant must not be forced or led to
what she or he considers as embarrassing answer which could harm a respondent as a result
of revealing the information (The researcher took into consideration the above discussed
issues). For example, if the interviewee avoided answering a question, the researcher would
ask the question in a different format, once the interviewee persisted in not answering, the
researcher moved into another question. Additionally, all interviewees were given the
opportunity to not answer any question that they felt uncomfortable with.
In this study the major ethical issue the researcher has dealt with in relation to participants
is privacy. Saunders, et al., (2003) stated that privacy may be seen as the cornerstone of the
ethical issues that confront those who undertake research. Consent, confidentiality,
participants’ reaction and the effect of the way in which researchers use, analyse and report
data may all have the capacity to, or are related to, the privacy of participants. Participants
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asked for their names not to be on any published materials but to use their job positions
instead. The participants’ right of privacy and right to refuse to answer certain questions
were respected. In the data analysis and reporting results stage, anonymity and
confidentiality are maintained to gain the participants’ satisfaction regarding their privacy
rights. Transparency has been considered as a significant factor which may affect the
validity of data collected from participants, thus, the research purpose and objectives were
clearly explained to the participants enabling them to make their decisions whether they do
or do not want to participate.
5.9 Summary
This chapter has set out and described the research purpose design and approach, and the
analytical techniques adopted. It has detailed the multi-approach of qualitative and
quantitative research and describes the presentation of the data analysed. The chosen
sample was defined and the interview and questionnaire techniques have been described.
The software analysis tools have been examined and justified and consideration has been
given to ethical issues.
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144
Chapter Six
Findings
145
6.1 Introduction......................................................................................................................................... 147

6.2 E-commerce drivers and barriers...................................................................................................... 147
6.2.1 Competition....................................................................................................................................... 148
6.2.2 Cost ................................................................................................................................................... 156
6.2.3 Culture............................................................................................................................................... 164
6.2.4 Economic development ..................................................................................................................... 171
6.2.5 Employment ...................................................................................................................................... 176
6.2.6. Government...................................................................................................................................... 181
6.2.7 Infrastructure ..................................................................................................................................... 187
6.2.8 Legislation......................................................................................................................................... 194
6.2.9 Payment............................................................................................................................................. 200
6.2.10 Traditional business ........................................................................................................................ 207
6.2.11 Knowledge ...................................................................................................................................... 212
6.2.12 Security ........................................................................................................................................... 217
6.3 Pioneer Initiatives ............................................................................................................................... 219
6.4 Benefits of e-commerce to Libya........................................................................................................ 220
6.5 Other Comments ................................................................................................................................. 222
6.6 Summary.............................................................................................................................................. 222
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6.1 Introduction
This chapter presents the findings of the study conducted in Libya to establish the
requirements of e-commerce adoption in the country. Interviewees covered all Internet and
economic development areas including decision makers, Internet users and service
providers in the country.
One hundred and fifty responses to the questionnaire were received, a response rate of 83.3
percent. These questionnaire results are summarised in appendices 10.3 Questionnaire
respondents were from different backgrounds holding different positions in their
organisations. 54 percent of the respondents were either self-employed or employees in
different sized organisations, 46 percent were university students.
6.2 E-commerce drivers and barriers
There are certain barriers and drivers to e-commerce in Libya. Interviewees were asked
about e-commerce barriers. All agreed there many barriers to e-commerce in Libya and all
argued that it was time for the government to get involved and to help to set up the requisite
infrastructure. Other barriers, such as legislation, culture and economic development effect
were argued. On the other hand cost and economic development were claimed as the main
drivers for e-commerce. In this section each issue of e-commerce driver and barrier will be
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discussed individually to provide a deeper understanding of the real situation of e-
commerce in the country and its effect on the national economy.
6.2.1 Competition
Competition can be considered as a driver and barrier for e-commerce in Libya. In relation
to this study, the researcher compares the issues mentioned in the literature review with the
findings of this research study as it is listed below.
6.2.1.1 Competition as a driver for economic development
The literature argues that competition could drive the economic development of a country
by providing cheaper products and services. The findings of this study confirm the above
statement. All interviewees agreed that competition will have a positive effect on the
country’s economy
The undersecretary of MOC argued that e-commerce in developing countries, and in Libya
in particular, may sharpen competition. However, he argued that competition will have a
positive effect on the country’s economy. He stated:
It is probably right that e-commerce in developing countries will sharpen

the competition, even in Libyan markets, but we don’t always look at it
from this point of view, it could help developing the Libyan economy.
He explained that e-commerce may help Libyan consumers to save money by comparing
different prices in the market. He stated:
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As a consumer in Libya rather than paying x billions for importing

something from outside which already has many added up cost e.g.
travel, commission, customs etc., that amount could be reduced by using
e-commerce and cut the cost.
The chairman of OPTC argued that businesses in Libyan markets will have to shift their
activities into the web in order to survive. This will create competition between traditional
businesses and Internet businesses. He stated:
With the popularity of Internet websites and increasing numbers of

Internet users, many people will shift there activity into e-commerce. An
example of e-payment system will help many people to get cheaper and
faster products over the net if they can use e-payment systems instead of
cash.
The marketing manager of LTT confirms the same statements of OPTC chairman. He
argued that an alternative payment system (see Section 6.2.9) will create competition
between those businesses adopting alternative payment systems and traditional businesses.
The marketing manager of LIB argued that Internet service providers in Libya are
complementing each other rather than competing against each other, which may be the
reason for not seeing a comprehensive reduction in the charges for Internet connection.
The operations manager of LCB argued that the absence of electronic payment systems
minimises the competition between banks and drives banks in Libya to deal with only one
international bank for all their international activities. However, the IT manager of CBL
argued that the national payment system will create the opportunity for banks and
companies to support business online nationally and internationally as well as giving the
Libyan banks the opportunity to compete with international banks.
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Competition between telephone service providers in Libya already exists, according to the
BA Chairman, for example, the competition between traditional telephone services and
voice-over-internet-protocol (VOIP). Such competition does result in reduction on
telephone charges. He stated:
I don’t know the exact price in my mind but using VOIP could reduce the
cost of making the same phone call using fixed line by 90 percent
The chairman of BA Group added that e-commerce will create competition between
traditional and electronic businesses especially for buying products and availability of
different type of products. He argued that competition is strong between electronic
businesses, and stronger between electronic and traditional business. He stated:
You can see offers on something, from small to large companies, this
huge amount of competitors selling same thing you won’t be able to find
it in a traditional trade or offline trade. Secondly, you have the
opportunity to compare prices for different products or even for the
same products, and as we all know Internet prices are much lower than
the high street prices.
He also added that by adopting e-commerce, Libya’s agricultural products will be exposed
to the international market. These products, he claimed, are known for their low price and
good quality which will result in increasing the business activities in this field.
Additionally, the Internet café manager argued that e-commerce will help the development
of the economy by introducing new companies and will force the traditional ones to change
their way of doing business. Additionally, the Internet café manager of AR argued that the
absence of competition between Internet service providers kept the Internet connection
charge high.
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6.2.1.2 Lower production cost will encourage the entry of new business
Lower production costs will encourage the entry of new businesses and thus increase
competition and pressure to pass lower costs on to consumers as lower prices. This was
confirmed by the undersecretary of MOC, who agued that e-commerce will create more
competition and the Internet will drive many travel agencies to close. He gave an example
by stating:
Last night, I was by the central bank of Libya in Benghazi. I saw an agent
advertising a Haje trip for 625 L.D. In the future, by using the Internet I
wouldn’t see these agents, I will go to the travel company itself and reduce
the price.
Additionally, he argued that reduction on customs and taxation resulted in increasing
competition between traditional traders and electronic traders.
The chairman of OPTC argued that e-commerce will speed up the way of doing business in
his organisation and it will reduce cost. He gave an example of receiving payment in cash.
He stated:
As an example, because the cashiers deal only in cash, security is costing

us a huge amount of money. Also, having things done electronically would
help to speed up doing the job and having things on the system right away
the moment they have been entered, rather than the manual way that we
are doing now.
The same opportunity for new services and businesses will be offered to the commercial
banks in Libya. The IT manager of CBL argued that the national payment system will
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provide these banks with opportunities to provide services and improve their services
quality. He stated:
This system aims to develop technologies and techniques for banking

activities of national banks in a way that qualify them to benefit mostly
from the huge technologies provided by the project of National
Payment System, and to strengthen the competitiveness with
international banks.
For private businesses, the feeling was the same as others. The Chairman of BA Group
agreed that Libyan consumers will save money and gain better services by using e-
commerce.
6.2.1.3 E-commerce will shift market power from producer to
consumers
Consumers will be able to search among thousands of merchants for lower prices, thereby
increasing the downward pressure on prices which will lead to a shift in market power from
producer to consumer. The undersecretary of MOC agreed that people will buy direct from
the source rather than go to a physical shop. The wide variety of Internet websites provides
consumers with the opportunity to buy when and where they please. Such actions, he
argued, will drive local suppliers and producers to provide better services and quality to
face the competition. The same view was agreed by a number of interviewees (AW Internet
Café manager, AR Internet Café manager, BA Chairman and LCB operation manager) that
the Internet gives the opportunities of searching among large numbers of stores and
providers to gain the best price offered. The BA group chairman confirmed this view of the
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MOC undersecretary, arguing that the Internet gives users the opportunity to choose and
compare what they want to buy. He said:
E-Commerce gives me the opportunities of choosing your product or

services from huge varieties of selections rather than the typical way of
choosing using the traditional way.
6.2.1.4 The effect of competition on small businesses
Competition could destroy small local businesses. These businesses could go elsewhere or
cease to exist. In either case this will affect economic activities such as taxation and
employment. Such issues can be seen in Libya. The undersecretary of MOC argued that the
introduction of e-commerce will affect Libyan local businesses. He argued that
international companies know about e-commerce and its related issues whereas Libyan
businesses are still in the early stages of e-commerce knowledge. Also, he mentioned that
using the Internet will drive many businesses such as travel agencies to close; he explained
that people are looking to save money, therefore they will be looking to buy from the
source of the services rather than local agencies. He advocates that if local suppliers are
going to survive, they will have to compete and provide better services for lower prices.
The LCB operations manager argued that competition between electronic business and
traditional business may result in the disappearance of the traditional businesses from the
market.
However, the chairman of the BA Group claimed that Libyan markets are consumer
markets. He argued that the markets will not be affected much by e-commerce stating that
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enabling e-commerce services would benefit the consumer by being able to buy the same
product at reduced prices. He explained that e-commerce may affect traditional businesses
but will benefit consumers. The undersecretary agreed that competition in the commercial
market will get sharper. He stated that Libyan producers are always complaining that many
international products have entered the country through Libyan importers or traders.
Additionally, the chairman of the BA Group argued that products in the market are either
external or internal. Stating that:
Many of the products in the market are imported from outside and if
we take out agricultural products then we could say yes e-commerce
would pose some threat to traditional commerce.
He explained that many of the consumers would just go to the source and buy what they are
looking for at a competitive price. This will enable them to save money and reduce the cost
of buying which will create competition. He further added that agricultural products will
not be affected by e-commerce because of the already low prices and high quality of these
products. Additionally, the undersecretary of MOC argued that competition in the
commercial market already exists. He stated that:
The ministry was afraid that e-commerce in developing countries will

effect competition. This didn’t happen in many countries and this fear
has dissipated.
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6.2.1.5 Other issues
In the case of Libya, where few, if any, studies have taken place related to the subject of e-
commerce, this study clarifies that competition in the commercial market already exists,
i.e., before the introduction of e-commerce. Therefore, competition is a result of the
economic development cycle rather than e-commerce alone.
It is been stated by the undersecretary of MOC that Libyan producers are complaining that
many international products have entered the market via Libyan importers and traders. He
stated that competition from e-commerce has not occurred in many developing countries.
Additionally, the chairman of OPTC and the marketing manager of LTT argued that
competition from e-commerce will not occur until the country’s infrastructure is ready.
Another reason mentioned by the business development manager of CI is that most Internet
users are young which will delay the arrival of competition in the country. He stated that:
A higher proportion of Internet users in the country are teenagers.

Middle-aged and older people don’t really bother to learn any new
technology because of the time-consuming and difficulty of catching up.
Most middle-aged and older people still prefer using a traditional way of
doing business. Most of it is done face-to-face. So there is no threat in a
short term.
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Table 6.1 below summarises the above competition issues and introduces three new issues.
Table 6.1: Competition issues in Libya
Competition could drive the economic development of

a country by providing cheaper products and services 1 Driver
Lower production costs will encourage the entry of

new businesses and thus increase competition and
pressure to pass lower costs on to consumers as lower 2 Driver
prices.
Consumers will be able to search among thousands of

merchants for the lowest prices, thereby increasing the
downward pressure on prices and leading to a shift in 3 Driver
market power from producer to consumer
Competition could destroy small local businesses.

These businesses could go elsewhere or cease to exist.
In either case this will affect economic activities such 4 Barrier
as taxation and employment.
The lack of e-commerce infrastructure in Libya has

New Barrier
delayed the effect of e-commerce competition
Older and middle age people in Libya prefer using the
traditional method of business which reduces New Driver
competition in the market
Competition is a result of the economic development
New Driver
cycle and not e-commerce
6.2.2 Cost
6.2.2.1 E-commerce reduces costs
All interviewees stated that cost is a major issue for e-commerce. The undersecretary of the
MOC claimed that the introduction of credit cards in the country will encourage people to
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use e-commerce. He also claimed that competition between service providers will drive
down costs, benefiting consumers.
The committee chairman of OPTC agreed that e-commerce will save money for his
organisations and will speed up the way of doing business. Additionally, according to the
chairman of BA, e-commerce results in reducing general expenses especially for private
companies as well as giving buyers a variety of product selections. He explained that e-
commerce benefits his organisation in many different ways stating that benefits differ from
one field to another. Giving an example in the accounting field, he argued that the company
provides some services online such as consultation, auditing and book-keeping. Without e-
commerce he said the company will not have the opportunity to provide these services to
customers from different countries. Clarifying that before using the Internet as a service
platform the company used to spend a large amount of money travelling to visit clients.
Another example given was the consultation field; he explained that using a traditional
method, the company usually sent a consultant to the client’s office to resolve problems but
using the Internet he stated the company could provide better services as the company
consultants could work together on one project without leaving the office. He summarised:
If everybody started using e-commerce, our quality of life will improve,

and time and money will be saved. Almost everything in business can be
done via the Internet especially in our fields. E-commerce is a great tool,
if we can use it in the appropriate way.
The operations manager of CBL argued that e-commerce reduces the cost of operations. He
stated that:
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As soon as the project is finished, our next step is to start thinking of

adopting an electronic banking system for our customers that will
reduce costs and staff headcount.
Thirty three percent of the questionnaire respondents strongly agreed that e-commerce
helps to reduce costs, where only 8 percent strongly disagreed with the statement.
Additionally 31 percent of the candidates stated that in order for the Internet to be
successful in Libya, a reduction of connection costs has to be implemented.
6.2.2.2 E-commerce reduces communication cost
According to the Chairman of the BA Group and the general manager of OCC, email and
VOIP reduce communication costs. The BA Group chairman argued that his organisation
managed to save up to 90 percent of communication costs by using VOIP, whereas the
general manager of OCC stated that most of his organisation’s business activities take place
on the Internet. He stated:
We usually do our market research on a particular project, sending all

documentation by email to our Athens branch, get information back with
project requirements and price estimations and then finally submit our
proposals. When we get a contract we usually contact our supplier and
sub-contractor by email. Most of the negotiation takes place over the
Internet.
Other interviewees such as the Business development manager of CI argued that e-
commerce and the Internet helped the company to reduce the cost of communications and
employment. He argued:
For our business, e-commerce reduces the cost of employment as many

customers can complete transactions online, This brings in more
customers, especially the VIP self-trading system, reduces the cost of
printing and communication, making it easer to communicate with
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customers, and finally reducing marketing costs. Cost reduction is the

main driver for e-commerce.
6.2.2.3 E-commerce reduces selling costs
Reducing selling costs is one of the main drivers of e-commerce. The Chairman of BA and
the Internet café manager claim that e-commerce reduces the trading cost for importers and
reduces selling cost.
6.2.2.4 E-commerce reduces cost of customer service and after-sales
service
The marketing manager of LIB argued that e-commerce helps in reducing the cost of
customer services. Giving an example of Electricity Company, he stated:
Why does the electricity company have to employ someone whose entire
job is standing at a cashier window collecting money, when they can do
it electronically and avoid people wasting their time in queuing as well
as destroying the employee’s life by doing nothing but collecting money?
6.2.2.5 E-commerce implementation cost
The cost of implementation is one of the major e-commerce barriers. The LTT marketing
manager argued that the high charge of Internet connection was due to the cost of
implementing ATM technology in the server of LTT. He argued the company has to make
sure that such expenses are covered in order to reduce the price. Additionally, the
operations manager argued that implementing the payment system in Libya has cost the
Central Bank of Libya 40 million Dinar. Similarly, two Internet café managers (AW, AR)
stated that the cost of PCs, network, hosting and domain names is also a barrier for e-
commerce in Libya.
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6.2.2.6 Cost of hardware and software
The cost of hardware and software remains out of the reach of many people. However, the
Libyan government has taken action to overcome such barriers, for example by providing
One Laptop Per Child (see Section 6.2.11) and reducing the customs duty on electrical
equipment (see Section 6.2.4). Additionally, the MOC undersecretary claimed that 25
percent of Libya’s citizens have PCs in their homes.
6.2.2.7 Cost of Internet connection and telephone charges
‘The cost of Internet connection is high and needs to be reduced’ this statement was argued
by all interviewees. The general manager of OCC and the undersecretary of MOC maintain
that the misunderstanding of e-commerce and the poor communication infrastructure with a
high cost of Internet connection are a barrier for e-commerce use. The general manager
added:
The main barrier is the infrastructure. The government has to pay

attention to infrastructure, and has to take e-commerce issues very
seriously if they want to develop and catch up quickly.
The undersecretary of MOC explained:
E-commerce is dependent on the telecommunication infrastructure; our

land lines still lack good infrastructure as well as high charges for
connecting to the Internet and making phone calls.
Others argued that the Internet does not cover the whole area of the country - it is only
available in cities. Access to the Internet according to some interviewees (OC, AR) cost
around £250 a month for a peed of 128kb, £25 for ADSL services of 64kb and at least £350
a mouth for 512kb using satellite technology. In addition to above, according to three
managers, a charge of £3500 has to be added for installation (AW, AR, and OCC). Another
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manager (OCC) explained that his company pays around £750 a month for 1mb as well as
£75 a month a cable rental using a lease-line technology. The marketing manager (LIB)
stated that Internet mobile technology costs 1 Sterling penny for 1kb. He admitted that the
prices are slightly high compared to other Internet providers such as LTT, arguing that the
reason was the service is aimed a businessmen who want to access their email on the move.
Justifying the high charges, the marketing manager of LTT stated that ADSL needs ATM
technology in landline digital servers, and that recently this service has been put in place.
Prices remain high in order to cope with the high demand. As he stated:
Economy rules supply and demand, we have put the price higher in
order to reduce the demand, with time the price will be decreased
gradually.
He argued that 256kb service which cost now 9000 L.D (£4500) a year was reduced from
55000 L.D (£27500) a year admitting that the price of Internet connection is extremity high
compared with other international ISPs explaining the reason of that:
New technology costs a large amount of money to put in place.

Reduction in costs is our priority, we have reduced the price by huge
percentages, some times exceeding 70 percent, it all depends on the
infrastructure.
In agreement with LTT marketing manager, the manager of AR stated that the cost of
connecting to the Internet has fallen gradually through the years citing the reduction of
Internet charge per hour from £6 to 50p.
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6.2.2.8 E-commerce Increases saving
Interviewees argued that e-commerce helps consumers to increase their savings by
purchasing at lower prices from the competing providers. The LIB Marketing manager
stated that people are looking to save money and they adopt the e-commerce to do so.
Additionally, the BA Chairman argued that the main driver of e-commerce is saving
money. He argued that consumers can buy from the Internet at competitive prices and save
money which can be re-invested in the economy (see Section 6.2.4).
There are some issues related to cost that were mentioned in the literature review but have
yet to been seen in Libya. For example, the cost of implementing ICT infrastructure is still
not yet an issue in the country. Libya is building an ICT infrastructure, however, at the time
this research was taking place, the country was still in the negotiation process with
international companies and the amount of investment by then was not an issue.
Delivery infrastructure (postal services) does not exist in Libya. Therefore, international
companies cannot deliver physical products to customer’s premises. However, the need for
such infrastructure is still not the priority in the country so there are no e-commerce
activities in the country for the time being. But in the near future the issue will be a
necessity for business environments.
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6.2.2.9 Other new issues
The Internet café manager of AW and the operations manager of LCB argued that
implementing e-commerce will create a training need for the use of new systems and hence
a cost. The operation manager argued that:
The central bank of Libya is sending employees from all Libyan public
banks outside the country for training from time to time to learn English and
get some training in banking electronic systems. Other workshops and
training courses are taking place inside the country.
He added that e-commerce reduces the cost of transactions in the banking system rather
then the traditional methods. He argued:
It is even more important that it will help banks to complete their

transaction quickly and easily. As an example, to clear a cheque to your
account from someone else in a different bank will take from a week up to 40
days for the time being, When the system is in place and working, that type
of transaction will take seconds. This will save time and money.
Table 6.2 lists issues that were mentioned in the research findings.
Table 6.2: Cost issues in Libya
Reduces costs 1 Driver

Reduce communication cost 2 Driver
Deliver information in digital format 3 Driver
Reduce the cost of supply chains 4 Driver
Reducing selling cost 5 Driver
Reduce buying cost 6 Driver
Providing opportunities to sell 7 Driver (Not yet)
Reducing the cost of customer service and after-sales
8 Driver
service
Implementation cost 9 Barrier (Not yet)
Maintenance cost 10 Barrier (Not yet)
Shipping costs 11 Barrier (Not yet)
Cost in term of hardware and software 12 Barrier
Cost of Internet connection and telephone charge 13 Barrier
Cost of implementing ICT infrastructure 14 Barrier
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Delivery infrastructure 15 Barrier (Not yet)

Increase saving 16 Driver
Cost for training in using the new system New Barrier
E-commerce reduce the cost of banks transactions New Driver
6.2.3 Culture
Interviewees were asked if culture can affect the adoption of e-commerce.
6.2.3.1 E-commerce conflict with culture and religion
The marketing manager of LIB argued that e-commerce gives citizens the freedom to
express different opinions and thought, which can be seen as a barrier for e-commerce
adoption in a Muslim country such as Libya. The undersecretary of MOC argued that
Libyans are resistant to culture change. He explained that job changes are not accepted by
many Libyans. He stated that Libyans generally benefit from ‘an easy life’ as a result of
government policies. The chairman of OPTC claimed that culture can be a barrier for
adopting a new system. He stated:
Persuading people to adopt and accept electronic payment will be a

barrier. Everyone has to have cash, personal cheques are not accepted
in many places, people still don’t have a culture of writing a cheque.
How can we expect them just to accept e-commerce easily?
The LCB operating manager argued that people will not accept new technology easily
which will affect the adoption of e-commerce. However, he explained that e-commerce is
still in its early stages and therefore resistance is not yet apparent. Additionally, the
marketing manager of LTT emphasised that Libyans who do not have payment cards will
resist the adoption of e-commerce He explained:
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People who have the opportunity to travel abroad and use the internet
and manage to get credit or debit cards know what e-commerce and
Internet are about. But those who haven’t had the chance to go abroad
know nothing about e-commerce and will face difficulty in getting into
the new technology, and will not accept easily the changes in their lives.
However, and according to the chairman of BA, culture will not be a barrier for e-
commerce adoption Libya. He explained that e-commerce brings a new way of doing
business and shopping. He argued:
People like change and new methods of living their lives which could
count as a driver.
He argued that Libyans are change adopters, giving as an example the move from living in
tents towards living in high buildings and towers. He then mentioned that e-commerce
could bring the right structure and help drive economic development.
6.2.3.2 Intervention to ban the sale of certain items that violate culture
The manager of AR said that Libyan culture, traditions and values may intervene against
this type of economy and create certain barriers, e.g. selling certain goods and products that
conflict with such culture, traditions and values. The marketing manager of LTT argued
that people will fight not to adopt e-commerce if they believe that their culture will be
affected.
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6.2.3.3 Offering credit card services with interest rate
Credit cards are expected to become common in Libya. However, interviewees’ opinion on
the adoption of the credit cards varies. The undersecretary of MOC argued people will not
wait for legislation to use the cards. They are waiting for the moment cards are issued and
ready to use, he explained:
We are expecting the spread of credit cards in Libya by next year

according to the plan of Central Bank of Libya. People will start trading
if they have the opportunity; they won’t wait for legislation.
The marketing manager of LIB emphasised that paying interest on credit cards is not
allowed in the Islamic religion. However, the Central of Bank of Libya has announced the
introduction of payment cards in Libya, the IT manager of CBL explained that the National
Payment System will enable businessmen and companies to accept payments electronically.
6.2.3.4 Child protection
The Internet and e-commerce are still in the early stages, therefore, there were no
comments on child protection and related issues. However, such issues will arise in the
future, especially because the majority of Internet users in the country are teenagers. The
undersecretary of MOC claimed that the younger generation will grow up using the Internet
and e-commerce.
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6.2.3.5 E-commerce helps to maintain culture
The Internet café manager of AW argued that e-commerce could help to keep the culture
and customs of a country, giving an example of the convenience of e-commerce to Libyan
women. He explained:
For Libyan women who are not usually allowed to go outside of their
house according to the customs and tradition or who are busy with
house-keeping and have no time to go shopping, the Internet will be a
very useful tool for them.
Additionally, he argued that it should benefit men as well in that they do not have to wait
for their wives while they do the shopping. Such a culture exists in most Arab countries
where women are not encouraged to work or be involved in any way with men who are not
related to them.
6.2.3.6 Change in business culture
Seven interviewees agreed that e-commerce will change the business culture. The
undersecretary of MOC argued that the uptake of credit cards will drive many businesses to
change their culture and business models. The OPTC chairman explained that his
organisation is already changing its business culture by introducing new electronic services.
He stated:
E-commerce will be a good thing with convenience and the ease of use;
changing business culture will be good for the business and customers.
The marketing manager of LIB and LTT explained that e-commerce will change the way of
living, speed up the way doing business and save time in social life. The same comments
were made by the operation manager of LCB who argued that the Central Bank of Libya
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will help other banks to change their traditional business methods. He also mentioned that
Internet banking will be the next step for Libyan banks after the adoption of the National
Payment System. Evidence of business culture changes were confirmed by the chairman of
the BA group and the general manager of OCC. Both organisations are using e-mail and
VOIP for their communications and business activities.
Table 6.3 below indicates that many Libyan organisations and users have already started
using the Internet for e-mail purposes, and believed that e-commerce can provide
organisations with more advantages. For example 85 participants believe that e-commerce
speeds communications and at least 74 of the respondents argued that E-Mail was useful for
communication.
Table 6.3: Benefits of e-commerce
Strongl Not Disagre Strongly

Agree
y agree sure e disagree
Internal e-commerce speeds
communications 53 32 31 13 12
Make organization more effective 25 37 48 13 19
E-mail is useful for communication 55 19 30 13 18
E-commerce provide efficiency 53 13 32 13 11
Increase storage methods 54 24 25 17 19
Lower cost 49 17 37 18 13
Retained/gained customers 48 19 39 7 5
Better relationship with partners 42 19 37 17 19
Less paper handling 49 1 43 3 7
Better control over information 54 20 49 17 7
Reduction of admin tasks 36 25 55 13 6
Additionally, 53 percent of respondents indicated that they already have a website, which
suggests that the Internet is already having an effect on people’s lives. Thus it would appear
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that e-commerce may not conflict with the culture of the country. However, it is difficult to
know what the full effect of e-commerce will be on Libya’s culture at this stage.
Another issue mentioned was the mistrust of service providers; the marketing manager of
LTT stated that mistrust that has built up over the years has affected users. He argued that it
is extremely difficult to change people’s beliefs and reaction against the Internet and its
lack of ability to keep information and payment details private. He stated:
Some people don’t really believe they can trust websites. The problem is
that it will be difficult to convince people that something is real or not
through website advertising.
Others argued (OPTC, BA):
If we don’t move quickly, people will feel scared to use the Internet and
some of them may never use IT.
However, one interviewee (LIB operation manager) stated that e-commerce in Libya is still
in its infancy in terms of knowing its disadvantages. He argued that time is needed to
clarify the disadvantages in the country.
Another issue was mentioned by the MOC undersecretary and five other interviewees:
education and reduction on customs duties on imported electronic equipment may help to
change the culture of Libya’s citizens. Additionally, they explained that changes in business
culture will create money and help the country’s economy, referring to the saving from
169
using the e-commerce. The OPTC chairman stated that reducing costs can help people to
change the culture.
The OPTC argued that people need to be encouraged to use e-commerce for the first time.
He said:
If we provide incentives for people to use electronic payment and they

are encouraged to use it for the first time, then they might realise the
benefits. I think adopting things now is important, there should be a
nationwide strategy to push new technology, once it’s used and accepted
people will get used to it.
In a summary, all issues mentioned in the literature review were confirmed in the research
findings. Additionally, a number of new issues were mentioned. The previous and new
issues are listed in Table 6.4
Table 6.4: Culture issues in Libya
E-Commerce conflicts with culture and religion 1 Barrier

Intervention to ban the sale of certain items that
2 Barrier
violate culture
Offering credit-card services with interest rate 3 Barrier
Child protection 4 Barrier
Religion issues 5 Barrier
E-commerce helps to maintain culture 6 Driver
Change in business culture 7 Driver
E-commerce maintains Arab culture for women New Driver
Mistrust of website is a barrier for culture change New Barrier
Training and education can change the culture
New Driver
regards e-commerce
For culture change, people may need to be forced to
New Driver
use the technology
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6.2.4 Economic development
e-commerce will have a significant effect on developing the economy of Libya. All
interviewees were asked if e-commerce will effect the development of the economy. Most
interviewees (MOC, OPTC, LIB, LTT, BA, AW, OCC, LCB and CBL) agreed that e-
commerce will help developing the economy. The undersecretary of MOC argued:
I don’t think e-commerce would have any bad effect on the Libyan market.
The undersecretary of MOC agreed that e-commerce will increase competition, but he also
argued that competition will help to develop the economy. He added:
We have no choice but to adopt e-commerce; we can see the successful

trail in Tunisia. E-commerce could help developing the Libyan economy,
as a consumer in Libya rather then paying x billions for importing
something from outside, which already has many added cost e.g. travel,
commission, customs etc. These costs could be reduced significantly by
using e-commerce.
He ended saying:
If we start providing services in Libya using e-commerce we would help

developing our economy and be in a better economic position.
He explained the importance of Libya’s location and tourists’ attractions in the country,
such as the Mesrata FreeZone. Believing that e-commerce would help the country to
advertise its attractions and help to develop the tourism industry, he said:
Many people don’t know what Libya has to offer. If we put things on the
web and provide services over the Internet, we can expect to see a
significant increase in business. For tourism as an example, travel
agents could advertise Libyan historical places using flash technology
that will definitely bring more business to the whole country.
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He argued that if tourism companies and government ministries introduce these attractions
to the world electronically in professional form then that on its own will be enough to help
develop the economy.
6.2.4.1 The cost of adopting e-commerce could result in delay to
economic development
The cost of e-commerce adoption varies from one country to another. The infrastructure of
Libya is still in the early stages of development. The operation manager of LCB argued that
developing the infrastructure of Libya will delay the adoption of the banking system. He
explained that there is no connection between the bank branches. The same comments were
supported by the IT manager of CBL. However, not one of the interviewees mentioned the
delays of economic development of e-commerce. The reason may very well be the good
financial situation in Libya and its surplus of oil. Additionally the chairman of BA argued
that if the technological infrastructure is improved and used as an economic tool then e-
commerce will make a big difference in the economy. He said:
I have no doubt about the power of e-commerce on economic

development.
6.2.4.2 E-commerce could shift economic activities away towards
advanced regions
It is argued in the literature that adopting e-commerce technology could shift economic
activities away from marginal or disadvantaged regions towards advanced regions. Such
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concerns were not expressed by the interviewees. The operation manager of LCB stated
that e-commerce may create threats to business in Libya, but such threats may be seen in
the future, not in the short term. The chairmen of the BA group said that the Libyan market
is more a consuming market than a producing market. Therefore, e-commerce will create
no threat (see Section 6.2.10). One interviewee (the undersecretary of MOC) said that there
is a need for coordination within Libya’s markets. He referred to the expansion in e-
commerce activities which is anticipated to result in an increase in the volume of the
Libya’s exports, given the future of Libya’s distinctive position as a trade centre and a
major financial market in the region for re-export. He contends that there is an urgent need
for coordination among African countries in order to provide a joint information
infrastructure that can contribute to the development of information and its applications.
For example, e-government and the importance of human resources development to meet
the likely need for information technology (IT) professionals.
6.2.4.3 The success of e-commerce can be at the expense of local
enterprises
The success of e-commerce can be at the expense of enterprises in direct competition with
international suppliers. The undersecretary of MOC and the Chairman of OPTC argued that
e-commerce will cause many businesses in the market to fail (see section 6.2.10) and many
others will shift there activities onto the Internet. The Internet café manager of AW argued
that many new e-commerce companies will be created and if traditional businesses are to
survive, they will have to catch up with the technology. However, the undersecretary of
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MOC argued that competition between Libyan and international importers and traders is
already exists in Libya (see section 6.2.1).
6.2.4.4 E-commerce allows online businesses to gain traditional
business customers
The internet allows online businesses to gain new customers from the traditional
businesses. The undersecretary of MOC argued that as soon as e-commerce is available in
the market many businesses will be involved and the potential of Business to Business
activities will be significant. The Internet café manager of AR argued that the internet
market is bigger than local markets of any country and has no limit.
6.2.4.5 Adoption of e-commerce will result in reduction of costs
The BA group chairman argued that reducing costs and increasing the possibility of
opening new market places will help to increase production which will provide competitive
advantage aiding the development of the economy. Furthermore, he added, the Libyan
market is a consumer market. He maintained that 70-80 percent of consumer products are
imported. By using e-commerce consumers will save money which will contribute
positively to the economy of the country. The undersecretary of MOC argued that e-
commerce can help consumers to save money by buying cheaper products (see Section
6.2.1). Additionally, the reduction of costs in employment, travel, shipping and many other
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aspects will result in money saving which can be reinvested in the country’s economy (see
Section 6.2.2).
6.2.4.6 Issues not mentioned
There were some issues that were mentioned in the literature review but were not in this
study. The reason, according to the researcher’s best knowledge, is because of the early
stage of e-commerce adoption in Libya at the time of the study. For example, interviewees
could not comment on the benefits to Libya’s society or economic development. The same
case applies to companies who have less access to technology and Internet market share.
The Undersecretary of MOC argued that there will be some contraction of the economy and
reduction in government income (e.g. taxation) at the beginning of e-commerce adoption.
He stated that there is no way back, it is only forward with the e-commerce issue. He said:
You can’t clean your blood without losing some of it
He meant that even if some problems appear in the beginning that will not stop the
government, everybody will be happy with the final result. He stated that time wasted will
cost the country in money and time to catch up with other countries.
Additionally, the IT manager of CBL mentioned that training and education are needed, in
order to provide a human resources which will contribute to the development of the new
economy.
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In summary, Table 6.5 lists all issues that were mentioned related to economic activities.
Table 6.5: Economic development issues in Libya
The cost of adopting e-commerce technology could

1 Barrier (Driver)
result in delays to e-economic development.
Adopting e-commerce technology could shift
economic activities away from marginal or 2 Barrier
disadvantage regions towards advantaged regions.
The success of e-commerce can be at the expense of
local enterprises in direct competition with 3 Barrier
international suppliers.
Government returns (e.g. taxation) might be even
5 Barrier
lower than company-level returns
The Internet allows online businesses to gain new
6 Barrier
customers from traditional businesses.
Companies with less access to the new technologies,
Internet investment involves defending market share,
7 Barrier (Not seen)
so that social returns to this investment are lower than
private returns.
Government should encourage the use of a country
resource to provide cheaper prices than anywhere else 8 Driver (not seen)
in the world.
E-commerce will provide a variety of products from
10 Driver
all over the world.
Training and education are needed to create HR for
New Driver
Economic development
6.2.5 Employment
6.2.5.1 E-commerce may result in job cuts
Employment and job losses were other barriers mentioned by interviewees. One
interviewee (OPTC committee chairman) argued that:
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188The main problem of e-commerce and e-commerce in general is its

effect on employment. We are struggling with the high percentage of
unemployment.
However, the undersecretary of MOC argued that unemployment in Libya was not because
there are no available jobs to applicants but is rather having the right people in the right
place. He explained:
We have 1,000,000 foreign employees in Libya, but we have 300,000

unemployed Libyan citizens.
He explained that the mentality of the Libyan people, will not accept just any type of job or
fit in any positions that become vacant in developing nations. He gave as an example the
opposite: Europeans and their ability to adapt a new job in a new place. The reason for
giving this example was that European citizens need money to pay for rent and living
expenses, whereas in Libya this pressure is absent because food, drink and living expenses
are provided by the government at exceptionally low prices. Furthermore, he claims that e-
commerce is not to blame for unemployment. He explained:
It is because of the economic cycle. There are many studies showing the
percentage of unemployment is almost the same in all decades, and that
confirms e-commerce is not the reason for unemployment but the
development of the economy.
Reduction in administrative work is another driver that was mentioned. The marketing
manager of LIB argued that:
The most important driver is helping in administrative work. The official

number of employees in Libya, according to Saif Aleslam, might be
higher than the population.
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He explained that this is probably due to many employees of the government still being
paid even though they have left the job or may even have died! The current administration
systems are so poor that they have yet to catch up. He also explained that many low grade
jobs can be eliminated by adopting new technologies. He added:
Our traditional way of doing business is time consuming, people have to

leave their job just to pay some bills because they have to go to the
premises of their creditors, and that affects the efficiency of business and
delays production.
An additional driver he pointed out was self-organisation. He argued:
E-commerce will drive people to be more organised with their jobs and
payments.
6.2.5.2 E-commerce may result in creating new job opportunities
The belief that e-commerce can create new jobs was seen in many of the interviewees’
statements. The undersecretary of MOC argued that e-commerce will force people to learn,
improve and educate themselves to be redeployed in another position. The same view was
shared with the LIB marketing manager who argued:
People will think that e-commerce will affect the employment rate in the
country and will slow the wheel of economic development. They are
wrong. The people who are made redundant could be redeployed in
other positions and help in different ways.
The IT manager of CBL argued that the National Payment System training programme will
contribute in providing human resources that are needed for the banking sector and in
creating new job opportunities. Additionally, the Internet Café manager of AW argued that
e-commerce can provide opportunities for unemployed people. He gave as an example
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creating websites for car sales companies. Additionally, the BA Group chairman argued
that e-commerce can create new job opportunities by providing services internationally.
These opportunities, he explained, can be for Libyans or non-Libyans to participate in
delivering international services.
Questionnaire respondents were asked if e-commerce will help to reduce administrative
tasks. Thirty six participants strongly agreed, only 6 participants strongly disagreed. See
Figure 6.1
Figure 6.1: Reduction of administration work
All respondents who currently have a website update them themselves which can be an
indication of job opportunities being created by e-commerce adoption.
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It has been argued by the MOC undersecretary that the unemployment is a result of
economic cycle rather then e-commerce. He explained that all studies show that the
percentage of unemployment over the years is constant.
The IT manager of CBL, MOC undersecretary, LIB marketing manager and operation
manager of LCB all argued that training and education are needed for Libyan employees.
Such training and education will create new job opportunities and help in developing the
country’s economy.
In summary, all issues mentioned in the literature review are confirmed in these research
findings. However, some new issues arose. All issues are listed in Table 6.6
Table 6.6: Employment issues in Libya
Employment is an important factor in any

1 Driver
economy.
E-commerce may result in job cuts. 2 Barrier
E-commerce may result in creating new job
opportunities and encouraging employment 3 Driver
education and gaining new skills
Unemployment is a result of economic activities
New Driver
and not e-commerce alone
Training and education are needed to create new
New Driver
job opportunities
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6.2.6. Government
Interviewees were asked about e-commerce barriers. All agreed there are many barriers to
e-commerce in Libya and all argued that it is time for government to get involved and help
setting up the infrastructure.
The interviewees also indicated that some barriers are created through governmental
intervention, such as banning import and advertisement of goods and products
manufactured in certain countries, or actions of other governments through creating barriers
relating to copyright and patent laws.
6.2.6.1 Government always plays a role in economic development
Government always plays an important role in economic development. The undersecretary
of MOC stated that the Libyan government realises the benefits of e-commerce and has
made the decision for adoption. He explained that the successful adoption of e-commerce in
Tunisia encouraged the government to go ahead. He stated providing services using e-
commerce can help the country’s economy. Another important role that can be identified by
the Central Bank of Libya’s IT is that the bank is working on increasing the benefits of the
large development of information technologies and improving the environment for banking
activities.
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6.2.6.2 Government support of investments in country’s infrastructure
The Libyan government is supporting all the infrastructure investment in the country using
its different agencies. The MOC Undersecretary explained that the development of e-
commerce legislation is underway (see Section 6.2.8) and the Central Bank of Libya is
developing the National Payment System (see Section 6.2.9). OPTC is developing the ICT
infrastructure (see Section 6.2.7) and LTT is developing the internet connection in the
country (see Section 6.2.7) . However, all interviewees stated that the cost of Internet
connection is high and needs to be reduced (see Section 6.2.2). Some argued that the
Internet does not cover the whole area of the country and that it is only available in cities.
The committee chairman of OPTC argued that there is no one organisation responsible for
e-commerce barriers, explaining that the telecom service company is responsible for the
infrastructure, banks responsible for payments systems and the Ministries of Justice and
Economy are responsible for legal issues, admitting that all government organisations
should work together to have the right infrastructure for e-commerce. He stated that his
company’s responsibility is last on the list as a priority for using e-commerce. Further more
the marketing manager of LTT stated that ADSL needs ATM technology in landline digital
servers, recently this service was put in place which delays the introduction of the services
to the citizens.
On the other hand, the BA chairman argued that e-government adoption and payment
systems implementation are the major drivers of e-commerce in the country. The
undersecretary stated that e-government applications, such as new company registration,
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have already been implemented and that there has been an e-government adoption policy
since 1984 when the Libyan Prime Minister was thinking of using fax for all government
work. He argued that the government is working on developing full e-government covering
all government departments in order to centralise information.
As regards payment system adoption, the LTT marketing manager agreed with three other
interviewees (OPTC, BA and LIB) that a National Payment System is a big driver for e-
commerce. The undersecretary of MOC stated that the spread of credit cards across Libya
is expected shortly referring to the plan of the (CBL). He explained:
If the credit card system is distributed across the country then that will
build a very good infrastructure for e-commerce in the country.
In addition to that the operation manager of LCB stated that CBL is working on increasing
the benefits from information development by improving the banking activity environment
and introducing the National Payment System. He adds that CBL and other Libyan banks
are implementing a programme of technological developments in banking systems. The IT
manager of CEL argued that this programme is part of a strategy to ensure efficiency and
effectiveness of payment systems in the country.
The marketing manager of LIB explained that another payment system has been developed
by the company to enable customers to pay for activities over the mobile phone network.
He explained:
As a company we are trying to help to develop the country’s

infrastructure. We have to be up-to-date with rapidly developing
technology. We believe in the rapid change of our daily life, people
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won’t have enough time to spend in dealing with many issues such as
paying bills etc that is why we came up with this solution.
Another driver mentioned by the undersecretary of MOC, was the aim to provide one
million portable computers to young people (One Laptop Per Child, OPLC). He said:
… that would help catching up and educating our kids in order not to
have later on the problem of getting into technology.
He continued:
We are expecting to see a PC in each house; it will be like having a

radio or television.
Furthermore he said that the Economic Ministry has reduced the cost of importing
technology equipment in order to encourage citizens to benefit from the cheaper new
technology. He said:
What we are doing now is trying to help people to be educated. As an

example, we set up a plan to help people using new technology and
devices and we reduced the customs rates to be only 5 percent for all
electrical equipment.
6.2.6.3 Government is responsible for setting legislation and regulation
e-commerce law and regulation is one the drivers taking place in the country. The
undersecretary of MOC argued that the e-commerce law implementation is in process and
should be ready by 2008. He stated:
We are developing legislation for e-commerce. The decision was made

by the Minister of Economy and Commerce to start the process of
establishing a committee for this purpose.
Admitting that there are some barriers to adopting e-commerce law, he said:
184
What matters is can we make a regulation that will satisfy both parties -
customers and service providers?
Additionally the lack of regulation has created computer crime in Libya. The Internet café
manager of AW argued that there is no legislation to control computer crime which
encourages younger people to use pirated software (see Section 6.2.8).
6.2.6.4 Governments support monopoly organisations and limit the
opportunities for private companies
The Libyan government tends to support monopoly organisations and limit opportunities
for private companies. The Undersecretary of MOC stated that e-commerce infrastructure
of telecommunication is poor in the country (see Section 6.2.7). The Chairman of OPTC
advocates that his organisation is the only organisation responsible for the landline and
postal services in the country. Additionally, he explained, OPTC owns LTT (the only
Internet services provider), Libyanna and Al-Madar (The only mobile companies in the
country) (see Section 6.2.7). However, the chairman of OPTC claimed that the government
is thinking of privatising the two mobile companies in the country.
The undersecretary of MOC indicated that people will not wait for government action and
regulation to start using the Internet and e-commerce. He explained that the country has to
move quickly to establish the legislation.
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The marketing manager of LIB, the Business development manager of CI and the general
manager of OCC argued that the government and other private organisations should pay
attention to conferences, training sessions and workshops.
In summary, most of the literature review issues in government were mentioned in the
interviews, however, there are some issues that were not mentioned. The reason was the
early stages of e-commerce adoption in Libya. All issues are all listed in Table 6.7
Table 6.7: Government issues in Libya
Governments always play an important role in economic

1 Driver
development
The government is usually the main customer of small
2 Driver
businesses
Government will support all investments and
3 Driver
improvements in country’s infrastructure
Government is responsible for setting legislation and
4 Driver
regulation for trade
Government should think carefully about e-commerce
6 Driver
adoption
E-government strategies would provide significant
7 Driver
advantages and efficiency.
E-government will create new jobs for other private and
8 Driver
public organization
E-government improving services to citizens, 9 Driver
Improving the productivity and efficiency of
10 Driver
government agencies,
Strengthening the legal system and law enforcement, 11 Driver
Improving the quality of life for disadvantaged
12 Driver
communities,
Governments tend to support monopoly organisations
and limit the opportunities for private companies which 13 Barrier
could effect the adoption of e-commerce.
People are not waiting for legislation to use e-
New Barrier
commerce and Internet
Training and education is needed for decision makers New Driver
186
6.2.7 Infrastructure
6.2.7.1 Organisational infrastructure
All interviewees were asked about the type of software and hardware used in their
organisations in order for the researcher to observe the level of computer engagement in
their organisation. They all stated that Microsoft operating systems were in use along with
other Microsoft software and business applications, such as Microsoft Office, SharePoint
and server. Other software from different companies is used. According to one interviewee
(the BA chairman), some accounting software such as Sage Line 50 is used by his
company. Other interviewees stated that some software is developed in house.
All organisations have a network infrastructure and hardware at different levels. One
interviewee (the BA chairman) stated that his company had a full network installed and is
running Microsoft server 2003 linking all PCs and laptops to printers, FAX and scanners as
well as DNS Directories and email servers.
Interviewees and questionnaire respondents were asked if they have a website in their
organisations. Most had at least one website (the engineering manager of OC indicated that
his company has three different websites). Most websites however are designed in-house
and updated by company staff. One interviewee (the AW manager) stated that his company
had no website. Two managers (AW, LTT) and the chairman of BA argued that websites
are very important for businesses. The BA chairman stated that:
187
A website is a necessity for any business nowadays and it has to be seen

as a business model not just an advertisement on the web.
He argued that having a website may help to reduce the cost of face-to-face communication
and attract new customers. However, the engineering manager of OC believed that a
website would just give background information about the company and its services,
therefore there is no need for it to be updated often. One Internet café manager (AR) stated
that having a website is worthless arguing that a website would bring no benefit to small
businesses. His argument was about comparing the benefit of having website and the cost
of designing and hosting. Moreover he said that for his business all customers were local
and knew where the café was based. However, he explained that having a dynamic website
with free membership may provide a financial benefit, saying that such websites have to
provide social networking and should host discussion rooms, uploading and downloading
media files. An LTT marketing manager said that extra services, such as weather and
market watch, are important in websites as they kept visitors coming back. He argued that
the website should be updated regularly to keep customers interested.
6.2.7.2 Poor infrastructure limits e-commerce adoption
Additionally all interviewees agreed that infrastructure is one of the big barriers therefore
the country should take the right steps to develop its communications infrastructure. The
general manager of OCC added:
The main barrier is the infrastructure. Government has to pay attention

to infrastructure and has to take e-commerce issues very seriously if they
want to develop and catch up quickly.
188
The undersecretary of MOC stated that e-commerce infrastructure of ICT was not yet
ready. He argued that the network did not cover all the country’s regions. He explained:
E-commerce is dependent on the telecommunication infrastructure; our

land lines still lack good infrastructure as well as high charges for
connecting to the Internet and making phone calls.
Additionally, the operation manager of LCB argued that National Payment System success
is dependant on the improvement of the ICT infrastructure. He claimed that the bank’s
branches cannot be linked because of the poor infrastructure (see Section 6.2.9). The same
comments were made by the IT manager of CBL. The BA Group chairman argued that the
infrastructure is the main barrier for e-commerce in Libya, and insisted that the government
has to pay attention to ICT infrastructure in order for e-commerce to be successful.
Interviewees were asked about the Internet in their organisation and the type of
communication used to connect to the Internet. All interviewees were connected to the
Internet using different Internet Service Providers. Most interviewees were connected using
ADSL provided by LTT. Companies were paying one-off fees of 150 L.D (£75) for
installation and 50 L.D (£25) per month for 5 gigabyte (gb). Some were connected using
satellite technology paying around 7000 L.D (£3500) for installation and 750 L.D (£375) a
month for 256 kilobytes (kb). Others combine the use of ADSL and satellite technology to
maximise the speed and reduce the cost. The results are summarised in Table 7.10.
Table 6.8: Internet connection charge
Type of service Installation Monthly fees ISPs
Dail up - 0.40 L.D OPTC

ADSL (5gb) 150 L.D 50 L.D LTT
Lease Line 256kb 1000 L.D 1000 L.D LTT
Lease line 512kb 1000 L.D 1500 L.D LTT
189
Satellite (256 kb) 7000 L.D 750 L.D Others
The Business Development Manager of CI complained that the failure of connecting to the
Internet that was provided by LTT was one of the main barriers to e-commerce for his
business, whereas the AR Internet Café manager stated that people are walking away from
the Internet because of the bad connection.
Figure 6.2 also shows the type of connection used. 33 percent are connected using satellite
technology, 17 percent using dial up technology provided by the general post service
company where 50 percent stated that their Internet was provided by LTT.
Figure 6.2: Internet service providers
Satellite
33%
LTT
50%
OPTC
17%
An Internet café manager (AW) said that connecting through satellite is more convenient
for many reasons, he then explained that connection rarely fails and when it does fail, there
is usually a quick response from the satellite service providers.
Table 6.9 indicates which communication tools respondents used. Most people use e-mail
and telephone over the Internet rather more than other tools. Other tools, such as Trade
190
Data Interchange and voice mail, are rarely used. Only 7 percent are using electronic forms,
5 percent using electronic funds transfer and telex.
Table 6.9: Communications tools
Communication tools No. %

Electronic mail 116 23%
Telephone over the Internet 98 19%
Document image processing 59 12%
Automatic Data Collection 42 8%
E-Catalogue 41 8%
Electronic form 36 7%
Fax 32 6%
Electronic funds transfer 25 5%
Telex 23 5%
Video Conferencing 18 4%
Trade data interchange 9 2%
Voice mail 7 1%
It is clear that e-mail is the most favoured Internet tool. E-mail does not need any sort of
payment regulation to be used in the country. Other tools, such as electronic funds transfer
and video conferencing, are rarely used because of the poor infrastructure of e-commerce
and lack of a payment system in the country. Additionally, 20 percent of respondents
strongly agreed that they are willing to be involved in e-commerce but they cannot use it.
Whereas 23 percent argued that the speed of Internet connection is the barrier.
191
6.2.7.4 The significant barrier for e-commerce is the control of
networks by monopolies
The only legal service provider in the country is owned by OPTC, argued the LTT
marketing manager and OPTC chairman. They claimed that no company is allowed to
provide Internet services in the country. The chairman of OPTC stated:
They are owned by GPTC. But there is a restructuring and re-organising

of telecom sector. All these companies will be sister companies and
owned by a holding company, the holding company by law still owned by
the government of Libya.
However, as the AW Internet café manager and the OCC General Manager said, many
organisations use other service providers from different countries (see Sections 6.2.8).
6.2.7.5 Infrastructure cost is significant
The cost of establishing the e-commerce infrastructure is significant. The OPTC chairman
claimed that his organisation invested a significant amount of money to develop the ICT
infrastructure and establish the two mobile companies and the Internet service providing
company (see Section 6.2.2). Additionally, the operation manager of LCB stated that for
establishing the National Payment System the Central Bank of Libya has to invest around
40 million Libyan dinar (see Section 6.2.9).
192
6.2.7.6 The Infrastructure of a country could be a main driver to attract
international companies
The undersecretary of MOC, the operation manager of CBL and IT manager of CBL agreed
that the National Payment System was developed by three international companies to
provide a payment system environment in the country.
The lack of infrastructure drives companies to break the law to get an Internet connection.
The Internet Café manager of AW and the OCC general manager stated that their
organisations are connected to the Internet using the satellite connection to overcome the
infrastructure barriers in the country.
In a summary, most of the issues mentioned in the literature review were confirmed in the
research findings. Table 6.10 lists all the issues.
Table 6.10: Infrastructure issues in Libya
If the infrastructure is in a poor condition then the

expectation to see an improvement in the e-commerce 1 Barrier
adoption is significantly low.
The main barrier for e-commerce is the law because of
the control of networks by monopolies or dominant 2 Barrier
firms in many developing countries
The infrastructure of a country could be a main driver to
attract international companies and foreign direct 4 Driver
investors to do business in that particular country.
Infrastructure cost is significant 5 Barrier
Infrastructure needs new strategies, planning and 6 Driver (Not mentioned)
193
management
Lack of infrastructure drives organisation to break the
New Barrier
law
6.2.8 Legislation
6.2.8.1 Legislation and regulation are required to control of the flow of
business
e-commerce law and regulation was one the drivers that was taking place in the country.
The undersecretary of MOC argued that the e-commerce law implementation is underway
and should be ready by 2008. He stated:
We are developing legislation for e-commerce. The decision was made

by the Minister of Economy and Commerce to start the process of
establishing a committee for this purpose.
Nine interviewees (the undersecretary of MOC, OPTC chairman, LTT marketing manager,
LIB marketing manager, BA Group chairman, LCB operation manager, CI business
development manager, AW Internet café manager and OC engineering manager) stated that
the lack of payment legislation is considered a barrier. They suggested that such legislation
will provide a good infrastructure for e-commerce in Libya. However, the IT manager of
CBL argued that the legislation for payment systems and credit card use was considered
before the National Payment System was implemented. He explained:
We have updated laws and regulations with which banking institutions

are working to reflect the effects of technological developments, and to
allow for the electronic transactions.
194
Additionally, the OPTC argue that other issues such as electronic signatures are still not
available in Libya. He explained that such signatures will ease the way of doing business
and encourage businesses to deal electronically. The BA Group chairman argued that the
absence of regulation has resulted in the delay of e-commerce adoption. The MOC
undersecretary explained that there are some barriers to adopting e-commerce law such as
ensuring that both parties have equal rights.
6.2.8.2 Piracy of products
According to some interviewees, many young people were interested in hacking and
cracking techniques rather than getting information from the Internet. An Internet café
manager (AW) explained that the lack of e-commerce and Internet knowledge drives many
people to take this hacking path. He said that many people use Internet cafes to crack
software keys and hack websites rather than to gain other benefits from the Internet. He
explained that this was because of the lack of payment systems and security as well as the
unawareness of computer crime in the country. He stated:
As a result of not having the ability to buy online, many young Libyans
are driven to finding alternative solutions to get what they want from the
Internet.
He added that they usually share hacking and pirating knowledge and techniques with other
users on the web.
195
6.2.8.3 The absence of legislation leads to difficulty in finding a total
solution
The undersecretary of MOC argued that the absence of regulation may effect badly the
Libyan users. He explained that many Libyans do not have the experience of using e-
commerce and its related activities which may lead them to breach the law. The OPTC
chairman advocated that his organisation has developed applications which are not in use
due to the absence of regulations (e.g. e-signature). In the same way, the marketing
manager of LTT argued that the lack of regulations and payment systems were the reason
for stopping his organisation getting involved with e-commerce. He explained:
For LTT, it is been a while since we were thinking of getting involved in

e-commerce because of the barriers such as payment systems,
transactions and government departments, we could not manage to move
forward too much.
The OPTC chairman explained that the absence of regulation has led to the difficulty of
adopting e-commerce. He explained that his organisation may be responsible for the
infrastructure issues, but there are no regulations to map the way forward for adopting e-
commerce.
The Operation manager of CBL stated that businesses using the Internet have to use LTT,
the only authorised ISP in the country rather than any other provider such as satellite
technology. The reason is that most satellite services providers have no licence to operate in
the country and are classified as illegal. However, some interviewees said that the LTT
196
service is improving and the company had reduced the cost of Internet connection by more
than 70percent.
6.2.8.4 Online viruses are becoming a serious matter
All interviewees argued that hackers and security are barriers for e-commerce (see Section
6.2.12). However, the AW Internet café manager stated that the interest in developing
viruses and hacking systems is result of the absence of regulation in the country.
6.2.8.5 The regulation of e-commerce will build customer trust
A number of interviewees ( BA Chairman, AW Internet Café manager and CI Business
development manager) argued that viruses and hackers had created a miss-trust of e-
commerce. Regulations and legislation can drive people to develop a trust in the electronic
services and use e-commerce for their activities. The chairman of BA Group explained:
The main disadvantage of e-commerce in Libya is the security,….In

order for the people not to feel scared to use the internet.
6.2.8.6 Issues not mentioned
Some issues found in the literature search were not mentioned in this research. For
example, the literature indicates that some goods and commodities can be bought and sold
illegally online. Such issues were still not obvious in Libya because there is no payment
system in place.
197
Additionally, the issue of the difficulty of setting up e-commerce regulation by one
government on its own was also not observed in Libya, especially since the Libyan
government had just start thinking of adopting e-commerce regulation. The same issue
would lead to the difficulty of understanding the conflict between the legislations of e-
commerce and other legislation.
According to undersecretary of MOC, people will not wait for government action to set up
regulations. He explained:
If the credit card system was distributed in the whole country then that
will build a very good infrastructure for e-commerce in the country.
People will start trading if they have a possibility - they won’t wait for
law to be issued.
Such issues can be seen as a driver for e-commerce adoption. If citizens start using e-
commerce in the country, then that will drive the government to issue the legislation and
regulation to cope with development.
According to the chairman of the BA group, that absence of regulation can affect economic
development. He explained that users will use other countries for their electronic activities
which will affect badly the economy of the country.
198
Four interviewees (LTT marketing manager, BA Group chairman, AW Internet café
manager and OC engineering manager) argued that education and training are needed to
provide an understanding of e-commerce and Internet technology and to prepare people in
the correct use of e-commerce applications and activities.
In summary, this research confirms most of the issues mentioned in the literature review
and adds some other new issues. These issues are listed in Table 6.11
Table 6.11: Legislation issues in Libya
Needs legislations and regulation to control the

1 Driver
flow of business
Goods and commodities can be bought and sold
2 Barrier
illegally online.
Piracy of products 3 Barrier
The absence of legislation leads to difficulty in
4 Barrier
finding a total solution.
No regulation leads to the possibility of Barrier (see Section
5
pornography 6.2.12)
Online viruses are a serious matter 6 Barrier
The regulation of e-commerce will build
8 Driver
customer trust
Regulation and prevention is very difficult for
9 Barrier (not seen)
individual governments.
E-commerce regulation could conflict with other
10 Barrier (Not seen)
legislation and regulation in a country.
Barrier (see Section
Concern about the security of network systems 11
6.2.12)
Concerns about the use of computer technologies
Barriers (see Section
for traditional property offences such as theft and 12
6.2.12)
fraud,
Concern about publishing hate speech and online 13 Barrier (Not seen)
199
talking
People will not wait for regulation to use e-
New Barrier
commerce
E-commerce users can force government to adopt
New Driver
regulations
Absence of regulation drives business away from
New Barrier
the local economy
Training and education is needed for e-commerce
New Driver
regulations
6.2.9 Payment
7.2.9.1 Payment system will encourage people to do business
The chairman of OPTC and the LTT marketing manager argued that a payment system
will enable customers to pay for their billing online. He explained that this online payment
system will save the cost and speed the time of transactions. The LIB marketing manager
argued that the National Payment System will be a driver for e-commerce in Libya (see
Section 6.2.2). The operation manager of LCB argued that his bank is expecting to see an
increase in business activities from his customers after the introduction of the electronic
payment system. However, the BA Group chairman argued that his organisation is already
working on introducing an electronic payment system for its customers (see Section 6.2.7).
The Chairman of OPTC argued that a payment system will reduce the cost of employment
and time of operating. Additionally, he explained that a payment system will reduce the
cost of securing cash, arguing that his organisation was paying a significant amount of
money for securing the cash and delivering it to other banks.
200
6.2.9.2 A payment system will speed up transactions and other banking
activities
It is argued that a payment system would speed up transactions and increase activities
between banks. The LTT marketing manager explained that the National Payment System
would allow immediate transactions between banks and organisations. The same view was
confirmed by the LCB operation manager, that the system would enable banks to save time
in transactions. He explained:
For banks, it is even more important because it will help them to

complete their transactions quickly and easily. As an example, to clear a
check in your account from someone else in different bank will take from
a week up to 40 days at present. When the system is in place and
operational, that type of transaction will be completed in seconds.
The CBL operation manager explained that the next step for his bank is to provide Internet
banking services. The IT manager of CBL argued that the new system would help to
monitor banks liquidities.
6.2.9.3 Payment systems constitute part of the basic structure of a
country’s economy
All interviewees agreed that payment systems are the main driver of e-commerce and are
the basic structure of the country’s economy (see Sections 6.2.2; 6.2.7 and Section 6.2.8).
The absence of a payment system has driven users to adopt illegal techniques to enjoy the
benefit of shopping online (see Section 6.2.12). Additionally, the lack of payment systems
in the country has driven many businesses to operate in other countries which can affect the
economic development of the country (see Section 6.2.4). The LTT marketing manager
201
argued that the lack of a payment system has limited the development of the country. The
LIB marketing manager argued that the National Payment System would positively affect
the economic development of the country, explaining that people need to realise time is
money and therefore the payment system can save time.
6.2.9.4 For e-commerce to be used, E-payment has to be installed and
ready
Four managers (AW, BA, LTT and LIB) and the undersecretary of MOC stated that the
spread of credit cards and ATMs in Libya is expected shortly referring to the plan of CBL.
The undersecretary of MOC explained:
If the credit card-system is distributed in the whole country then that will
build a very good infrastructure for e-commerce in the country.
In addition to that the operation manager of LCB stated that CBL is working on increasing
the benefits from information systems development by improving the banking activity
environment and introducing the National Payment System. He argued that:
For the time being, we are doing most of our international business
through the Arab Foreign bank.
The IT manager of CBL explained that the programme will have five phases. Each of the
phases will be installed separately. He then discussed the Automated Cheque Processing
(ACP) system which will enable electronic cheque clearing. Automatic Telling Machines
and Point of Sales (POS) devices will provide a fundamental environment for the national
202
automated teller distributor that will provide access to all customer accounts with
participating banks and execute cash drawing transactions through ATM machines by
national and international networks. He argued that:
It also enables businessmen, their clients and companies that provide

these services to accomplish the payments for transaction charges
electronically using point of sale.
The operation manager of LCB argued that the biggest challenge of the National Payment
System is the infrastructure. He explained:
We cannot get good connections between our branches right now.
It was stated that other challenges and issues such as education, training and languages are
being dealt with. He added that the next step for Libyan banks is to adopt online banking
systems. He explained:
As soon as the project is finished, our next step is to adopt electronic

banking for our customers that would enable customers to login to their
account through a website and do some activities, which we believe will
reduce cost and employment headcount.
The marketing manager of LIB explained that another payment system has been developed
by the company. The system enables customers to pay their utility bills and any other
services using their phone top ups. He explained:
As a company we are trying to help to develop the country’s

infrastructure. We have to be up to date with rapidly developing
technology. We believe in the rapid change of our daily lives, people
won’t have enough time to spend in dealing with many issues such as
paying bills etc. That is why we came up with this solution.
203
Furthermore, the marketing manager of LTT explained that his company strategy is to
reduce Internet connection costs and implement alternative payment methods in line with
the mobile company. He explained:
We are in discussion with a shopping centre to introduce one of the new

services which will enable customers to pay upfront for recharging
cards.
In addition, the committee chairman of OPTC that controls the telecommunication
companies including LTT and the postal services stated that his organisation will introduce
electronic billing and payment systems for his customers to pay online.
6.2.9.5 Adopting payment systems requires heavy investment
However, adopting payment systems requires large investment. The operation manager of
LCB argued that the National Payment System will cost the CBL around 40 million Libyan
diner. Additionally, he stated that once the system is ready to use, his bank will introduce
Internet banking to customers. Additionally, the LCB operation manger and IT manager of
CBL explained that the project will be delivered by three international companies and is
focusing on providing human resources for the Libyan banking sector (see section 6.2.11).
The LCB operation manager explained:
The central bank of Libya is sending employees from all Libyan public
banks outside the country for training from time to time to learn English
and get some training in banking electronic systems. Other workshops
and training courses are taking place inside the country.
204
6.2.9.6 Securing payment systems in a country would need significant
investment
All interviewees agreed that there is a need for secure payment systems (see Section
6.2.12). However, the IT manager of CBL argued that the developer of National Payment
System will have taken into consideration the important of security in payment transactions
security. He explained:
The system will be provided with coding and protection software in

order to ensure safe and protected structure for data transmission
between banks, the currently-under-construction data centres and all
electronic financial services channels.
6.2.9.7 Payment in developing countries is cash or cheques
Interviewees were asked about the type of payment systems they use in their organisations.
Most agreed that cash is the commonly-used method. Others mentioned the use of money
transfer, bank transfer and approved cheques. None of interviewees were using credit or
debit cards in business. The chairman of BA stated that credit-card systems are not
available in the country at present. However, he stated that a development for accepting
credit and debit cards via his company website is taking place to be ready for use as soon as
it is available in the country. It is worth mentioning that some interviewees were using
credit cards issued overseas for personal use to buy from the Internet.
Payment systems are a barrier of e-commerce in Libya. The manager of AW argued that
money transfer and payment system was the main barriers:
205
The Internet has been introduced in order for people to get connected;
they sell, buy or exchange things; well in Libya we cannot.
He carried on explaining that transferring money is very difficult and expensive, there are
no cards to be used, and no ATMs, not even a third party to help customers to buy over the
Internet. Another manager (OCC) added, the inability to accept payment online is one of
the biggest e-commerce disadvantages in Libya, the payment schemes available for online
transactions are traditional payment methods which are cash-on-delivery and bank
payment. Additionally, the committee chairman of OPTC argued that people will not accept
easily electronic payment systems as they used to carrying cash and paying by cheque.
According to the LIB marketing manager, his organisation has introduced an alternative
payment method. The reason according to the interviewee is that users want to use the
system and they will not wait for government action. The same view was supported the
undersecretary of MOC and LTT marketing manager.
In summary, all payment issues that were mentioned in the literature review were
confirmed in these research findings. Additionally a new issue arose. All issues are listed in
Table 6.12
Table 6.12: Payment issues in Libya

Payment systems will encourage people to do 1 Driver
business
Payment systems speed up transactions and other 2 Driver
banking activities
206
Payment systems provide new opportunities for 3 Driver

online services.
Payment systems constitute part of the basic structure 4 Driver
of a country’s economy
For e-commerce to be used, e-payment has to be 5 Driver
installed and ready.
Adopting payment systems requires large investments 11 Barrier
Securing payment systems in a country would need 16 Barrier
significant investment.
Payment in developing countries is via cash or 17 Barrier
cheques
Alternative methods of payment will be introduced to New Driver
fill the gap of payment systems in Libya
6.2.10 Traditional business
Traditional trade in Libya might be threatened by e-commerce. E-commerce is changing
the way of doing business all over the world. All interviewees were asked if e-commerce
would pose any threat to traditional commerce. Some argued (CI, OC) that e-commerce
may pose some threats. A manager (AR) added that e-commerce will create many new
companies which will pose threats to the older ones. He explained that older companies
will have to adopt e-commerce along with the traditional way in order to survive.
6.2.10.1 Traditional businesses in developing countries were
established long before e-commerce
However, others argued that e-commerce does not pose threat to traditional businesses, it is
rather a new method for traditional businesses. One argued (OC engineering manager) that
the two business methods are identical, especially in a market like Libya; he argued that
207
many traditional businesses are using the Internet and the result being a perfect
combination in both sides. Furthermore, two interviewees (LCB, IC) agreed that they will
be not be a threat in the near future. A café manger maintained that traditional trade will not
be threatened, provided that traders can cope with the transformation and changed
operations, and the modern applications of techniques in the field of information
technology. The development manager of IC stated that the financial sector will not
experience any threat arguing that in this sector manual and personal work is always
needed. Explaining his view, he stated that one of the reasons was the difficulty of
correcting a mistake electronically then manually in his organisation. He added that the
other reason is that most of the Internet users in the country are young; middle-aged and
older people do not really bother to learn any new technology because of the time and find
difficulty in catching up.
An Internet café manager (AW) explained that clothing items, cosmetics, and other
merchandise belonging to this category are unlikely to benefit in the near future in a wide
and accelerated manner from e-commerce, particularly since these depend upon the buyer’s
sense of fashion and culture. One manager (AR) maintained that the traditional trade
infrastructure has been well established in Libya over the last thirty years, whereas the e-
commerce infrastructure is still in its early years of existence. Furthermore, two managers
(OCC, AW) maintained that the level of e-commerce consciousness that has spread through
Libya and other Arab countries is still considered as the least developed with regard to
communications and information at the global level, and the least competitive and the least
free from government and private sector control. One argued:
208
Our people have still a mile or so to go this way until they are used to
using the Internet and become e-commerce customers. Nonetheless,
indications reveal that we are going that way with big strides. From
now, one can say that traditional trade is not threatened whatsoever by
e-commerce; the latter is still in its childhood, if not in its infancy.
6.2.10.2 Traditional companies are the main economic contributors to
the economy
The undersecretary of MOC argued that traditional companies are the main contributor to
the country’s economy. However, he explained that Libyan producers are complaining that
many international products have entered the market. He explained that the competition
will be higher once e-commerce is adopted in Libya (see Section 6.2.1). He argued that
local producers have to improve their production quality in order to cope with e-commerce
competition. The LTT marketing manager argued that even though his organisation is an
Internet services provider, most of the organisation’s activities are still done in the
traditional way of business. He said:
We provide no service over the Internet. For most of our services you
would have to walk in and apply.
6.2.10.3 Government and companies have to monitor e-commerce
development
The undersecretary of MOC argued that governments have been monitoring the
development of e-commerce and its effect on traditional businesses in a number of
countries such as Tunisia. He explained that this fear of e-commerce affecting the
209
traditional businesses starts to disappear with experience (see Section 6.2.1). Additionally,
the chairman of the BA group argued that most of the products in Libya are imported from
overseas. He explained that there is no threat on traditional business. He stated:
70-80 percent of consumer products have been imported from outside, so

by allowing e-commerce services, that would benefit more the consumer
by buying the same product at lower prices.
He explained that e-commerce will not effect the agricultural products in Libya because
Libyan fruit and vegetables have a reputation of high quality and low price. Additionally,
he added, the amount of production is not enough to satisfy the local market (see Section
6.2.1 and Section 6.2.4).
The MOC undersecretary argued that the reduction of customs and taxes on electronic
equipment may be beneficial to traditional businesses. He explained that traditional
importers can save money on shipping and other costs of the imported equipment to the
Libyan market than the cost of buying such equipment from e-commerce website.
6.2.10.4 A failure to involve traditional businesses would work against
e-commerce adoption
The Business development manager of CI argued that the older generation in Libya do not
use e-commerce and Internet but these people are the main spenders in the market. The
OPTC chairman agreed with the CI manager explaining that in order for e-commerce to be
adopted, the government must encourage the use of e-commerce.
210
The CI business development manager and the AW Internet café manager argued that most
of the Internet users in the country are teenagers. Older people are not commonly using the
Internet. The CI business development manager explained that older people do not have
time to learn about e-commerce.
Reduction on customs and taxes can drive traditional businesses to save more money than
e-commerce websites.
In summary, all the literature issues mentioned are confirmed by these research findings.
Table 6.12 lists all the issues.
Table 6.13: Traditional business issues in Libya
Traditional businesses in developing countries

1 Barrier
were established long before e-commerce.
Traditional companies are the main economic
2 Barrier
contributors in the economy.
Government and companies have to work
together in monitoring technological and strategic
development in the use of e-commerce in order
3 Barrier
for these companies to maintain their place in
international competition and restructure their
organisations.
A failure to involve traditional businesses would
work against e-commerce adoption and against 4 Barrier
economic development.
Traditional businesses and e-commerce
5 Driver
businesses could work together.
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Traditional business will be effective as long as

New Driver
the majority of users are teenagers
Reduction of customs and taxes can help
traditional businesses to save more money than e- New Driver
commerce websites.
6.2.11 Knowledge
6.2.11.1 Knowledge of e-commerce
Interviewees were asked if they had heard of the term e-commerce. Seventy three percent
of interviewees agreed that the term means commercial activities on the web including
selling, buying and some other commercial activities; it is the future of traditional business
with less difficulty and saving time and money. Moreover, the chairman of BA added that:
E-commerce is trading on all human needs through electronic sites,

paying for these needs using different payment methods in informatics
networks.
Additionally, the general manager of OCC argued that term of e-commerce had been taken
notice of but a clear explanation was needed.
This lack of awareness of companies’ electronic activities was notable from many
respondents and interviewees. Employees are not aware of their organisation’s engagement
in electronic services and have no willingness to be notified. The reason could be a failure
of managers to engage employees in their organisation’s activities.
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6.2.11.2 Education and training
The lack of e-commerce and information systems courses and training in the country may
be one of the main issues arising from this low result of e-commerce engagement. It was
noticed that many people use some Internet and e-commerce tools but they do not know
that these tools are linked to the subject investigated.
The BA chairman stated that one of the main barriers for e-commerce in Libya is electronic
illiteracy. He said:
Electronic illiteracy is the other main barrier but this barrier can be
dealt with in a short time if the government and people are willing to
learn.
Another manager (LIB) argued that knowledge is an important issue and it is a barrier for e-
commerce in Libya. There are no schools or colleges interested in the area or to provide
courses in e-commerce. He said:
Probably around 1 or 2 percent of the population know about and are

interested in e-commerce.
Some interviewees (BA, AW, LCB and LTT) admitted that lack of knowledge and shortage
of expertise in the field is a major barrier arguing that international expertise will not easily
meet the needs of the Libyan market. One Internet café manager (AR) argued:
There are no available courses for e-commerce or even modules in

courses.
213
Additionally, the marketing manager of LIB argued that lack of knowledge could cause the
delay of the adoption of e-commerce, giving as example the introduction of 3G services in
the country. he explained:
We are facing a huge problem with 3G services. People do not know

about it at all, and do not want to try it.
On the other hand, the government is trying to deal with technology issues by taking some
action, for example the undersecretary of MOC talked about providing one million portable
computers to young people (One Laptop Per Child, OPLC) (see Section 6.2.11).
Additionally, according to the operation manager of CBL, the company is sending
employees from all Libyan public banks outside the country for training, language courses,
and work experience. Other workshops and training courses are taking place inside the
country.
All interviewees argued that the lack of knowledge in e-commerce and its related activities
have created some barriers for e-commerce adoption. The undersecretary of MOC
explained that international companies know about e-commerce but Libyan companies do
not. However, most of interviewees’ organisations are encouraging in-house development
of applications which can be seen as a driver for adopting e-commerce knowledge. The
OPTC chairman and LTT marketing manager argued that it is not just the technology of e-
commence that is needed for e-commerce adoption, it is also the willingness of people to
learn and gain knowledge about e-commerce. The LTT marketing manager explained that
prepaid cards for shopping can help people to learn more about e-commerce without taking
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the risk of electronic payment. He added that people who had the opportunity to travel
abroad gained knowledge about new technology. He said:
People who had the opportunity to travel abroad use the Internet and
manage to get credit or debit cards. Then they know what e-commerce
and the Internet are about, but those who haven’t had the chance to go
abroad know nothing about e-commerce and will face difficulty in
getting into the new technology, and will not accept easily the change in
their lives.
The marketing manager of LIB argued that the resistance of users to gain knowledge is one
of the barriers in the country. He explained that his organisations faced significant barriers
to educate people on using third generation mobile technology. He stated:
We are facing a huge problem with 3G services. 3G is a new technology,

people don’t know about it at all. What we have thought is to provide
some services over 3G so people would get involved. And I think the
same way should work with e-commerce.
The LIB marketing manager argued that it is the responsibility of the Libyan government
and other private organisations to educate and train people on e-commerce. The same view
was confirmed by the chairman of the BA group who stated that his organisation’s
employees have the benefit of having overseas training and workshops in the country that
are run by international expertise. Additionally the lack of highly qualified personnel is a
barrier for e-commerce adoption. The LCB operation manager argued that most of the
specialised employees are not Libyan or are Libyan but living outside the country. The lack
of those people, he explained, may result in delaying the payment system implementation.
The reason for the high percentage of young people is that Libya has a high proportion of
young people in the population as explained in Chapter 5. The Internet café manager of
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AW argued that younger generation users are sharing information with other Internet users
specially in the area of hacking and viruses (see Section 6.2.12).
Questionnaire respondents were much less positive regarding the term e-commerce. Figure
6.3 indicate that 35 respondents out of 150 had never heard of the term e-commerce before,
while 43 stated that the term was heard of but had never been used, 37 had heard of e-
commerce but used it minimally and 31 had heard of the term in seminars. However, one
could argue only 35 candidates are using or are involved in e-commerce.
"Have you ever heard the term E-commerce"

Figure 6.3: E-commerce awareness
50
45 43
40
37
35
35
31
30
Frequency
25
20 18
17
15
12
10
7
5
5
0
never heard of Have heared I have heard Have visited have prepared planning for Undertaking e- we are we are
term before but not use in and useed in seminars strategy for e- using e- commerce extensive user extensive user
any way commerce commerce development of e-commerce of other
technology
Level of engagment
The lack of e-commerce and information systems courses and training in the country may
be one of the main issues arising from this low result of e-commerce engagement. It was
noticed that many people use some Internet and e-commerce tools but they do not know
that these tools are linked to the subject investigated.
216
6.2.12 Security
6.2.12.1 The need for security companies in Libya
Two managers (LTT, AW) agreed that there is a necessity of having security companies
entering the country. The chairman of BA stated:
Security companies should have representatives in the country and

define the country’s needs. What works for the whole world may not
work for Libya.
6.2.12.2 Viruses create mis-trust
Viruses, spam, copyright and security are other e-commerce barriers, as the general
manager of OCC stated describing hackers:
As long as these people exist in the market don’t expect to see anyone
trading online. People feel no security on the Internet.
Additionally, e-commerce regulation is another barrier that was mentioned by interviewees.
The BA chairman argued that there are many Libyans interested in exploring the new world
of e-commerce, all that stops these people is the fear of losing their money. The marketing
manager of LTT explained that:
For international companies the case is different. They know what they
should do and how to keep their rights, but for Libyans who don’t know
what e-commerce is all about, they may be abused by other companies
through not knowing their rights.
It has been stated by the interviewees that most of the software in Libya is not legally
acquired but is pirated in one way or another. One Internet Café manager (AW) said that
nobody pays for software in Libya; he has, he said, been using computers for more then
217
fifteen years and has never paid for software. He further explained that the software can be
downloaded and activated using a stolen key. Surprisingly, even security software such as
Kasper Sky and Norton antivirus are installed with stolen activation keys.
Another Internet café manager (AR) admitted that even though he downloads software
illegally, he knows it is not right. He explained that the lack of payment systems and other
e-commerce barriers mean that there is no legal way of acquiring software in Libya. He
said:
I know we should not do it this way, but what else can we do? We have
no alternative way of getting the software, this is the only way to be up-
to-date with technology and software.
However, the OPTC chairman argues that e-commerce provides security for his
organisations; he explained that paying security companies to provide guards to secure the
cash and guarantee the delivery to the bank costs his organisation a significant amount of
money. He explained:
As an example, we are paying a huge amount of money on security

because we deal in cash. Conducting transactions electronically would
help to speed up the process and having things on the system right away,
the moment the transaction is completed.
Additionally, the LIB marketing manager argued that by using e-commerce, people do not
have to carry cash and can feel safer. As for the security of the payment system, the IT
manager of CBL argued that the National Payment System provides a secure platform for
transactions (see Section 6.2.9)
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Forty three percent of questionnaire respondents stated that security is the biggest Internet
disadvantage. Such a high percentage in a country which has not yet adopted e-commerce
creates concern about the willingness of people to be involved in using the technology. As
shown in Figure 6.4 below, when people are asked if their fear of security is the reason for
not adopting e-commerce, the majority were not sure.
Figure 6.4: Fear of security
6.3 Pioneer Initiatives
Libya has started thinking seriously about e-commerce as an important issue to catch up on
the Internet revolution. One of the interviewees (OPTC committee chairman) indicated that
such pioneering initiatives are attributable to the decision-makers’ belief that the only
alternative, given the massive developments and progress in ICT at the global level, is to
participate in e-commerce, and to use all resources available to strengthen the infrastructure
219
base in preparation for the new modern economic order. Another interviewee
(undersecretary of MOC) referred to another initiative, the announcement of switching the
Libyan Government to e-government, and working on developing new e-commerce
legislation which stipulates that Libyan government departments must put into action an
active programme to transform and transfer all governmental transactions into digital deals
run on the Internet. The remaining interviewees also referred to this initiative, maintaining
that it will offer an appropriate background for interaction between the government, the
public and the business sector.
6.4 Benefits of e-commerce to Libya
Enterprises in both the public and the private sectors have recognised the concept and
benefits of e-commerce through the Internet. Most of the companies in Libya in particular,
and in the Arab World and Africa, in general, have shown huge interest and enthusiasm in
venturing into this field. The general manager of OCC explained that e-commerce will
bring great benefits to Libya’s markets and will help to improve the country’s economy
mentioning that Libya as one of the developing countries trying to re-establish their
economies and to start being in the world market. He maintains that the increasing move
towards e-commerce will promote the international position of Libya’s businesses. This in
turn will increase business trading opportunities. Other interviewees (MOC, BA, LTT, LIB,
LCB, and AW) maintained that the Internet and websites will benefit Libya a great deal in
terms of offering high-quality goods, commodities, products and services in a record time
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and at affordable prices compared to those offered by stores and firms operating in
shopping malls. A manager adds that e-commerce will affect the way of tradition, custom,
and living. Life will be changed and speeded up, people will realise the meaning of “time is
money” and they will pay money for Internet connection to save time. He adds:
It might even affect social life, people won’t waste anymore extra time in
sitting and chatting.
Another benefit for Libyan state companies is reducing the cost of employing security
guards to secure cash. The committee chairman of OPTC stated that e-commerce will be
effective; it will speed up the way of doing work in the company. He stated that:
We are paying a huge amount of money on security to secure cash that

will be avoided when we have an e-commerce transaction system in
place.
Questionnaire respondents justify the benefit of using e-commerce in the country. Seventy
five percent expressed their feelings on the benefits of enabling chatting systems. Seventy
three percent of the respondents stated that surfing the web and using telephone calls are
major benefits, where 80 percent stated that the main benefit of e-commerce is to acquire
information. However, only 34 percent were convinced that it could bring benefits for
selling, marketing and purchasing. The questionnaire results are summarised in Table 6.14.
Table 6.14: Reasons for Using e-commerce

For External call 50 63
Reasons
Trade No.
54 %
56
Upload files 42 54
To get information 109 80
Purchases 31 38
For chatting 97 75
Sell and marketing 26 34
For internal calls 58 73
For web site visiting 58 73
Self improvement 54 68
File transfer 72 65
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6.5 Other Comments
One interviewee (undersecretary of MOC) said that there is a need for coordination within
Libya’s market. He referred to the expansion in e-commerce activities which is anticipated
to result in an increase in the volume of the Libya’s exports, given the future of Libya’s
distinctive position as a trade centre and a major financial market in the region for re-
export. He contended that there is an urgent need for coordination among African countries
in order to provide a joint information infrastructure that can contribute to the development
of information and its applications, for example, e-government, and the importance of
human resources development to meet the likely need for IT professionals. The chairman of
the BA group stated that e-commerce would provide good opportunities for SMEs in Libya
especially in the private sector. These companies would be able to deal internationally
rapidly and with reduced costs.
6.6 Summary
E-commerce drivers vary from one country to another. Some drivers apparent in some
developed countries have not yet appeared in many developing countries and in some cases
these drivers in developed countries could be barriers in developing countries. It is
significant to note that some additional drivers were identified for the first time (according
to the researcher’s best knowledge) as a result of this research project.
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Technology adoption is usually combined with rapid economic growth and accompanied by
rapid structural change. E-commerce is expected to facilitate low-cost access to
international bidding and supply processes for companies in Libya. Moreover, Libya faces
challenges as the Internet technologies can pose a danger of economic marginalisation to
countries that cannot access it effectively. There are many barriers to e-commerce in Libya;
the misunderstanding of e-commerce by some of the population; the poor communication
with a high cost of Internet connection; lack of payment systems; viruses; copyright and
security matters. The Libyan government has begun to think seriously about adopting e-
commerce as an important tool to catch up with the Internet revolution. Enterprises in both
the public and private sectors have recognised the concept and benefits of e-commerce
through the Internet. E-commerce should have an effect on developing the economy, if it
gets the right infrastructure and is adopted as an economic tool.
There are a number of barriers to the adoption of e-commerce such as security, taxation or
even in some circumstances, too much business for a company to cope with. One of the
traditional barriers cited by many organisations to the growth of e-commerce is the
relatively high charge for Internet access, the tariffs payable and cost of connection. Other
costs such as hardware and web-design remain out of many people’s ability to pay for the
service. There are further barriers specifically related to developing countries. Users are
likely to be engaged in making improvements to their operations, often focusing on
production management, financing and accounting, product development and marketing
rather then paying attention to e-commerce and e-business strategies. There are many issues
that could count as drivers and barriers to e-commerce and economic development at the
223
same time. These issues are cost, payment systems, legislation and regulation,
infrastructure, culture and religion, government, employment, competition, traditional
business, economic activities, knowledge of e-commerce.
All driver and barrier issues listed in the literature review model (1) (see Section 4.3) were
examined in the interviews and the questionnaire. The results show that all driver and
barrier issues are apparent in Libya. However, some of the barriers, such as competition
and culture, have not been experienced in Libya because Libya was in the early stages of e-
commerce adoption. In order for the government to adopt e-commerce and close the gap
between Libya and advanced countries, the government will have to think seriously about
each and every one of the issues discussed above. For example, the government will have
to pay attention to the fundamental issues in the economy, such as infrastructure, payment
systems, and most importantly education before other issues of e-commerce.
Additionally, the e-commerce literature considers that the security issue is a result of the
lack of legislation and regulation. Results show that in Libya security was an issue on its
own, having connections, but not depending upon, other issues including legislation and
regulation. For example, the lack of Internet security in Libya was created because of the
absence of a payment system rather than the absence of legislation and regulation alone.
Knowledge of e-commerce, or lack of it, was seen as a fundamental issue for e-commerce
adoption in Libya, not only as knowledge of understanding but also as a tool for changing
culture and beliefs. The researcher believes that many countries have adopted the
224
knowledge of technology in stages by involving people in those stages of development of
that technology. e.g. people in other countries started using computers and the internet
before wireless technology appeared, however, the case in Libya is different, many people
need to be educated and trained in using technology and to see the benefits before-adoption,
otherwise those people will resist the introduction of this technology.
These findings confirm the e-commerce driver and barrier issues found in the literature and
identify two additional issues in security and knowledge.
The figure below shows the modified model of e-commerce drivers and barriers (e-
commerce drivers and barriers (2). Each and every issue could count a driver and/or a
barrier to e-commerce. The more benefit the issue is to economic development, the more
the issue counted as a driver.
225
Figure 4.1 E-Commerce drivers and barriers (2)
Barriers Drivers
Competition
Cost
Culture & Religion
Economic activities
Employment
Government
Infrastructure
Knowledge of e-
commerce
Legislation & Regulation
Payment system
Security
Traditional business
For e-commerce adoption to be successful, the government will have to ensure that the cost
of implementing and establishing the e-commerce is not higher than the investment returns.
To achieve this, the government of Libya has to choose the right organisation to deliver
good quality services at competitive prices. Most of these organisations will be
226
international companies. The returns on the investment of e-commerce in the Libyan
market will enable companies to save money and cut travel and shipping costs thus
expanding the economy. If cost reduction is greater than the adoption cost of e-commerce
then one could argue that the country’s economy is developing and that growth is starting
to take place. Economists should pay attention to the period of adoption as in the first
couple of years the cost of adoption could be higher than the cost reduction. Therefore a
calculation of spreading this cost over some appropriate period could be a solution.
However, how to measure the cost reduction in a country’s economy is a problem. Clearly,
it will be necessary to keep comprehensive records.
The culture of the country may be seriously affected by e-commerce. Therefore,
government has to ensure that the adopted technology can fit with the country’s culture and
tradition. Changing business culture can also be a driver for e-commerce adoption. Changes
in business culture could drive the whole country to see e-commerce as a useful tool.
Additionally, the government should support some cultural ideas and issues that e-
commerce may help to retain, such as encouraging Libyan women to work from home.
Competition in Libya will increase, and it may very well increase sharply for traditional
business providers. However, such competition could result in increasing economic
activities and create new jobs and enterprises which may result in developing the economy
of the country. If the government is able to support SMEs to adopt e-commerce, then a
better market for Libyan businesses could be created. The government could remove
227
barriers to international trade and develop the market for Libyan products brands
internationally.
Government has to play an important role in all activities for e-commerce adoption. The
companies can be the main drivers; therefore the government should do its part by
introducing credit and debit cards, legislation and help in education. The absence of
government action may result in delays or even the death of e-commerce in Libya.
From the above, it can be seen that e-commerce can benefit the Libyan market and help
Libyan companies to provide better services in an international market. However, the
Libyan government has tried to adopt e-commerce since 1984 and has still not achieved it.
This begs the question as to what strategy the government should now adopt for successful
adoption. The government can not play the role by itself. The government needs the help of
international companies to build the ICT infrastructure and the payment system. Also the
government needs to encourage users to get involve in e-commerce. Such involvement of
users will need the support of Libyan local businesses to create job opportunities. The
method of adopting e-commerce in Libya will be discussed in the following chapter.
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Chapter seven: The three-quarter moon model
229
230
Chapter seven
The three-quarter moon

model
231
7.1 Introduction......................................................................................................................................... 233

7.2 Drivers and barriers ........................................................................................................................... 233
7.3 The three-quarter moon model (specific to Libya) .......................................................................... 239
7.4 Action plan........................................................................................................................................... 242
7.4.1 Before e-commerce adoption ............................................................................................................ 242
7.4.2 During-adoption ................................................................................................................................ 246
7.4.3 After e-commerce adoption............................................................................................................... 249
7.5 The Three-Quarter Moon Model (General) ..................................................................................... 254
7.5.1 Capitalist approach ............................................................................................................................ 255
7.5.2 Socialist approach ............................................................................................................................. 259
7.5.3 Technologically advanced countries ................................................................................................. 259
7.5.4 Deploying the Three Quarter Moon Model ....................................................................................... 261
7.5 Summary.............................................................................................................................................. 264
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7.1 Introduction
This chapter examines the drivers and barriers of E-Commerce taking extracts from the
literature review and findings chapters to create a new model to help countries such as
Libya to adopt e-commerce. The chapter identifies the main actors for e-commerce
adoption and introduces a plan of action that Libya will need to adopt for successful e-
commerce adoption. If the Libyan government, Libyan companies and technologically
advanced countries (the three-quarter-moon) work together through set procedures to
involve the fourth part (Libyan e-commerce users) to complete the moon, then one could
argue that the adoption of e-commerce in Libyan has been successful. However, to allow a
smooth transition to e-commerce, investments are required in the social infrastructure and
employee skills to enable the use of the technology in a way that is compatible with the
local circumstances, cultures and abilities of users in Libya. The three-quarter moon is
designed to fit the situation in Libya, however a generalisation of the model will also be
introduced. The generalisation will enable the model to be applied to other developing
countries. In order for classifying the level of involvement in a country a formula of
Internet involvement is introduced and a classification for countries to point the level of
adoption is also explained.
7.2 Drivers and barriers
The findings and literature review chapters have indicated that there are many issues which
can be drivers and barriers for e-commerce in Libya.
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Competition could drive the economic development of the country by providing cheaper
products and services. Additionally, the lower production costs will encourage the entry of
new businesses and will increase competition in the market which may result in reduction
of costs. However, competition could destroy the small local businesses. These businesses
will not have the ability to compete with well-structured, multinational corporations. The
demise of these local companies will effect the economic development in the country and
shift the economic activities away from the market. In any case, it is still too early to
predict the effect of e-commerce competition in Libya, as the infrastructure of the country
is yet appropriate for e-commerce and most of the Internet users are young.
Cost reduction is one of the main drivers of e-commerce. E-commerce will reduce
communication costs, supply chain costs, postal costs, storage costs and many other costs.
It can reduce the costs related to buying and selling and save a significant amounts of
money that can be re-invested in the market. However, adoption of e-commerce will have
its implementation costs as well as the cost of hardware and software that is needed for the
end users. Therefore, the Libyan government and companies in the market have to study the
issue of cost carefully to calculate the benefits to the Libyan economy.
Culture is another issue; it was argued that e-commerce conflicts with culture and religion.
In Libya, e-commerce is still in early stage of adoption, so such conflicts have not yet been
seen. E-commerce can help to maintain the Libyan culture to provide work for Libyan
women from home. However, other people in Libya see e-commerce as a tool that may
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affect their culture. A number of Libyan organisations have recognised the need to change
business culture and processes. For e-commerce to be successful, the Libyan government,
local and international companies have to encourage people to use e-commerce. Education
and training may clarify the benefits of using such technology and will minimise user’s fear
and encourage trust.
E-commerce and economic development are closely linked. The cost of adopting e-
commerce technology could delay other economic development in the country, especially
as many infrastructure issues need to be dealt with before the adoption can take place.
Therefore, the Libyan government must prioritise these issues in order to overcome the
delays of the development. Additionally, the government should encourage local sourcing
and support local business to achieve the economic development. Enabling e-commerce
may force existing SMEs to modernise or move elsewhere to survive.
Employment is an important factor in any economy. E-commerce may result in cutting jobs
in the market by introducing technological applications and using the Internet. At the same
time, e-commerce will create new job opportunities for IT literate and other unemployed
people. Therefore, there may be a need for education and training for Libyan employees to
cope with the challenges of technology and being able to adapt to new job opportunities.
Additionally, it was argued that unemployment in any economy is a result of economic
activities rather than technology alone.
235
The Libyan government is playing an important role in the country’s economic
development. The government has supported all the investment in the country and is
working in improving the infrastructure. Additionally, the Economic Ministry is working to
establish e-commerce legislation which should support e-commerce in the country. Also,
the Central Bank of Libya, with the help of international companies, is working to
introduce the Electronic Payment System. However, the government still controls most of
the active companies in the market and supports monopolies which have minimised
competition in the market.
If the infrastructure of the country is in a poor condition, then the chances of e-commerce
adoption is low. The Libyan government, as argued in Section 6.2.7, needs to improve the
infrastructure of e-commerce in the country (e.g., postal delivery, payment system,
legislation, etc) and to support private sector organisations to compete with other
companies to achieve cost reduction (e.g. Internet providers).
Legislation for e-commerce and electronic activities is needed in the country. Goods and
commodities can be sold illegally in Libya and pirated software is available in the market at
low prices. The absence of legislation has resulted in delays to e-commerce adoption and
lack of confidence in using the Internet for business activities. However, even though the
Libyan government has started working to introduce new legislation for e-commerce and
electronic activities, it must pay attention to the conflict between new e-commerce
regulations and other regulations in the country.
236
A payment system may encourage people to do business online and gain new customers. It
may speed up transactions and activities between banks and provide opportunities for
online services. The Central Bank of Libya has started the adoption of the National
Payment System to introduce electronic cards, point of sales, ATMs, etc. However, the
system has come at significant cost and it will take time before people start seeing the
benefits of the system, because of the absence of other issues, e.g. infrastructure,
legislations, etc.
Traditional businesses in Libya were established long before e-commerce. It was argued
that traditional commerce is the main economic contributor in the economy. Because of the
absence of regulation, a payment system and other e-commerce issues, traditional
businesses still have not experienced any threat from e-commerce. Introducing e-commerce
in the country may affect the traditional business. Therefore, government and companies
have to work together to minimise the effect of e-commerce on other business and
maximise the benefit of the local economy.
The findings of this research have pointed to the importance of knowledge within the
population of e-commerce adoption. The absence of knowledge of e-commerce and its
related issues has discouraged many people from using it. People see e-commerce and the
Internet in general as a tool that may affect badly the culture of the country and may result
in significant problems via hackers and lack of security. Additionally, there is a lack of
experienced workers in the country who are able to help in the adoption. Therefore, training
237
and educations are important issues. Training and education are required for every e-
commerce driver and barrier.
This research has confirmed that security is an important issue. Previous studies have
associated the security problem with technical and legal issues. However, the researcher
believes that security is an issue on its own and has links to all other issues of e-commerce.
For example, security is an important factor in payment systems.
In summary, each e-commerce issue can be a driver and barrier in Libya. It was clear from
each interview that there is no one organisation that is responsible in Libya for setting the e-
commerce strategies and planning. Also, the Libyan government does not have a clear
strategy for e-commerce adoption. Drivers and Barriers Model (2) of drivers and barriers
explains the issues identified in Libya. However, a question to be asked is how can a
country such as Libya adopt e-commerce? To answer this question, the researcher will need
to develop a strategy for e-commerce adoption in Libya. For example, the research findings
confirm that there is a lack of infrastructure in Libya. This infrastructure issue is a necessity
for e-commerce adoption success. However, developing the infrastructure is likely to
require a large amount of investment and is likely to require the government to decide
either to develop the infrastructure of e-commerce or develop other aspect of the economy.
Therefore, a strategy of adoption and a plan of action is needed. Therefore, the following
section will introduce a plan for e-commerce adoption and list what the country will have to
do to achieve successful adoption.
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7.3 The three-quarter moon model (specific to Libya)
From this examination of the drivers and barriers for e-commerce, it appears that the main
actors in e-commerce development are government, technologically advanced countries,
companies and e-commerce users. Government helps to build the right foundation and
infrastructure for e-commerce adoption. In economic theory, government always plays an
important role whatever economic approach the country adopts (Todaro, 1999; Well, 2005).
Government’s role in economic development varies from one country to another. In a
country such as Libya, there will be more government involvement than in capitalist
countries. Therefore the Libyan government needs to establish an improved
telecommunication infrastructure, establish a payment system, remove international barriers
and build a postal services infrastructure.
However, in order to establish an e-commerce environment in Libya, the need to install and
maintain advanced technology will be a challenge. These new technologies will have to be
provided by more advanced countries. Once the two parties (Government and
technologically advanced partner countries) agree on the type of technology to be adopted,
then the two parties can work closely together to provide the technology and train
government employees to use and maintain the adopted technology. However, the
government needs to bear in mind that technology is developing rapidly, therefore research
and development and educational programmes are required in order to keep up to date.
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The third main actor in e-commerce development consists of companies (private or public)
operating in Libya. These companies clearly play an important role in increasing the
number of e-commerce users by providing online services and lower prices. They also can
provide services such as recruitment and leisure activities. Government and companies
have to work closely together in order to achieve these objectives.
A fourth main actor is the e-commerce user, without whom government and companies
would gain no benefit from their investment in technology. E-commerce users are the
fourth quarter of the moon and the involvement of these users is very much dependent on
the actions of the other three actors. For example, attracting users to a company’s website
to buy products or use the company’s services by offering better prices or giving awards via
the website. Another example is e-government services: citizens should experience the ease
of use and the saving of time and money by using government services via the government
websites.
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Companies in a
particular developing
country
E-Commerce users
in developing
countries
A government for a
particular developing
country
Technological
advanced
countries
Figure 7.1: The four e-commerce actors
These four actors have different roles to play to complete the adoption of e-commerce in
Libya. Even though the e-commerce users are the result of other actors’ actions, they still
have roles to play in e-commerce adoption such as culture and religion. If an e-commerce
service in Libya conflicts with the culture or religion then e-commerce adoption may be
prejudiced and a bad image of the technology created which will be difficult to overcome.
Therefore all four actors have roles to play in the adoption of e-commerce. This theory
suggests that in order for e-commerce to work smoothly within Libya’s economy, three
adoption processes have to be undertaken: before, during and after. The three adoption
processes are the action plan and they are discussed below.
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7.4 Action plan
The plan of action attempts to plan the adoption of e-commerce in Libya. For successful
adoption, the adopters should go through three stages or ‘an adoption life cycle’. The three
stages should involve all four actors. Prioritizing action of plans varies from one country to
another depends upon different issues and abilities. For Libya, a rich oil-producing country,
priority in relation to financial constraints is not an issue specially that (as explained in the
research findings) the country is willing to develop and support the adoption of e-
commerce and ICT technology. However, in this research, issues were prioritized according
the interviewees’ opinions of the relative importance of each of the issues. For example,
interviewees stated that having legislation and regulation were the most important issues to
be dealt with for successful e-commerce adoption. Other countries would have to re-
prioritize the plan of actions according to their ability to deliver and implement similar
actions as determined by financial and other constraints. For actions, such as infrastructure
and payment system, these other countries may seek FDI to speed the adoption process.
7.4.1 Before e-commerce adoption
Before e-commerce is adopted the following issues should be addressed:
 Legislation and Regulation: regulation should control and manage the way that
electronic transactions and activities are carried out in the country. E-commerce
legislation needs to consider globalisation and the involvement of other countries as
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well as all economic activities in the country. Removal of import and export barriers
is vital to the success of e-commerce. For example the Libyan government restricts
the purchase of products from Israel and even from companies having business
activities in Israel. Such restrictions limit the ability of e-commerce activities to
expand.
 Telecommunications infrastructure: an infrastructure should be built for
providing citizens with telephone lines and Internet connection. Digital technology
could be used to provide landlines and/or wireless technology especially for rural
areas.
 Postal Infrastructure: in order for non-electronic products to be delivered to
consumers who may have bought them from the Internet, a postal and transportation
services infrastructure must be established. This development could be carried out
by government or by private delivery services. In either case the government has to
think carefully about the way to develop postal services especially for countries
such as Libya where there is no Post Code or delivery address.
 International Trade: the infrastructure of international trade has to be established
that would include many of the above mentioned factors, in order to enable buyers
and sellers to trade fairly and without any restrictions.
 Establishing E-commerce Department: one of the main issues of e-commerce
adoption is creating a responsible committee or a department responsible for e-
commerce activities and regulation. This department or committee could be
representative of different ministries and departments of government, or a new
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department which will work closely with all ministries. It has been argued in Libya
that the main issue effecting e-commerce adoption is a lack of a responsible
government department.
 Payment System: this is an essential part of the infrastructure for economic
activities and e-commerce. The payment system must be established and put in
place before e-commerce adoption to enable users to transfer, receive and pay
money without the need to visit a bank. Other related payment system issues such as
Point of Sale and ATMs have to be considered.
 Removing Barriers to Foreign Investment: e-commerce adoption may bring more
new businesses, create new strategies and platforms to do business. Many
international companies will have to have branches, representatives, resellers, and
after-sales support for their customers. These international companies will help to
develop the Libyan economy. In order for these investors to enter Libya, they will
have to make sure that there are no barriers to export or import, as well as other
issues such as taxation, regulation and skilled employees.
 E-government Strategies: e-government strategies are additional factors that have
to be thought through carefully before the adoption of e-commerce. E-government
will be one of the main drivers of e-commerce and will encourage users and others
to participate.
 Low Cost Hardware and Software: this needs to be provided to users before the
adoption in order for people to get used to using computers and understand the
nature of computer software. Even though hardware and software costs have fallen
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dramatically over the years, the prices are still out of the reach of many people in
Libya. Therefore, the government, companies and other technologically advanced
countries have to find ways of providing hardware and software. An example of this
is the OLPC supported by the United Nations to provide cheap laptops to children
in developing countries.
 Education and Labour Training: education and training could be delivered in
Libya by companies from technological advanced countries or by sending citizens
to these technologically advanced countries. This will enable the country to keep up
to date with technologies and the best ways of using that technology. Additionally,
research and development on e-commerce and related subjects should take place
before, while and after the adoption, which will help the country to find the best
possible way of adopting new technology and keep the development of the economy
sustainable.
 Lowering Taxation: lowering taxation on imported and exported products and
services would solve the problem of double-charge taxation between countries and
encourage e-commerce users and others, which will benefit the government by
increasing the activities relating to e-commerce. Removing taxation barriers will
encourage many investors to trade with Libya, which will help in reducing
unemployment and create new business opportunities.
 Culture, Religion and Values: these have to be thought through carefully before
adopting e-commerce. Libya has to make sure that e-commerce will not conflict
with its culture and values. E-commerce actors (government and companies) have to
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be very careful not to challenge the religion or the culture of Libya. As an example,
selling pornography magazines or alcohol will drive many shoppers away from that
particular business. Even more, a picture of that particular business could be applied
to e-commerce as whole which will affect users’ incentive to use the Internet for
shopping in the future.
Table 7.1: Before-adoption issues in Libya
Technological
E-commerce
Government
Companies
advanced
countries
Before-adoption
users
Legislation and regulations Y Y Y
Telecommunication infrastructure Y Y
Postal infrastructure Y
International trade Y Y
Establish an e-commerce department Y
Payment system Y Y
Removing barriers for foreign investments Y
E-government strategy Y Y
Low cost hardware and software Y Y Y
Education and labour training Y Y Y
Lowering taxations Y
Culture, religion and values Y Y Y
Y: Means Yes (every actor with ‘Y’ means that actor is

responsible for this activity)
7.4.2 During-adoption
Once the ‘before-adoption’ issues are completed and dealt with, one could argue that the
fundamental infrastructure and enabling environment for e-commerce is ready. However,
Libya does not have to wait for full completion of all infrastructure projects. Once a
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payment system, legislation and regulation are established, and access to the Internet is
provided to citizens, government should start the second stage of the adoption process and
should think carefully about the following issues that will develop through the adoption of
e-commerce. This could be summarised as:
 New strategies: e-commerce is a new way of doing business; it is not just having a
website for business. New strategies have to be developed and put in place at all
organisational levels. Many businesses in Libya would face the challenge of
preparing new strategies; therefore the Libyan government and other businesses
should help by providing the services of designing e-commerce strategies. Most
traditional businesses, should ensure that e-commerce works smoothly with their
traditional activities.
 Change business culture: government and companies will have to change
business culture; e-commerce has its own organisational culture, a culture that
deals with the skills of computers and quick response to emails and customers’
enquiries. Change in the strategies of management, marketing, promotion,
accounting and finance has to take place.
 Need to use local language on websites: many users and potential users in Libya
do not speak English. If a website is in English then that would limit the
involvement of users which will result in poor adoption. Local languages would
encourage people to use the Internet and create self-confidence. People are likely to
feel that their language, culture and traditions remain safe and are not adversely
influenced.
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 Encouraging expatriate workers to return from overseas: adoption of e-
commerce would need more than establishing infrastructure and putting security
systems and a payment system in place. It needs new skilled employees and
expertise to help design and manage strategies for e-activities. Training and
education of employees overseas or in-house would help but not fulfil the needs of
experience. Therefore attracting expatriates to return from overseas and work in the
country would result in improving the services. If Libya fails to attract back their
expatriate workers, they could fill this gap by employing experienced and skilled
workers from other countries who are cheaper and have similar culture, traditions
and values.
 Accept credit cards and international payment: services providers and
consumers would need to be able to pay for international services and products
over the Internet. Such a payment system is likely to be provided by an
international services provider. This would risk reducing local income to
government and local providers.
 Transaction security: security is one of the main challenges with e-commerce,
many users do not feel confident that their information would remain safe over the
Internet. Therefore government, companies and technological advanced countries
would need to work hard to secure transaction between buyers and by providing
secure platforms and convincing users to trust service providers.
 Culture, religion and value: culture will be affected over the years from the
adoption of e-commerce. Technology adoption usually combines with culture
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change. The government e-commerce department will have to monitor closely the
changing culture and address the changes needed in management and strategies to
fit with the new culture.
 Training and Education: government and companies should work in developing
ideas and training employees in using technologies as well as encouraging research
and development to keep up to date.
Table 8.2: During-adoption in Libya
Technological
E-commerce
government
Companies
advanced
countries
During-adoption
users
New strategies for government and businesses Y Y
Change business culture Y Y
The use of local languages in website Y Y
Encouraging expatriate workers to return from overseas Y Y
Accept credit card and international payments Y Y
Transaction security Y Y Y
Security Y Y Y
Culture, religion and value Y Y Y
Training and education Y Y Y

7.4.3 After e-commerce adoption
Once e-commerce is in place, government, businesses and users are involved in e-
commerce activities. The four e-commerce adoption actors will now have to pay
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attention to other factors that will arise after the adoption of e-commerce. These factors
need to be checked and monitored carefully and could be summarised as:
 Security: as mentioned above security is a constant challenge to Internet and e-
commerce. Government, businesses and technologically advanced countries
must work closely to overcome the threats to security that are created from the
use of e-commerce.
 Monitoring and updating: monitoring and updating is different from one actor
to another. For example, government has to monitor the use of the Internet,
generate statistics for the use of e-commerce and activities, and provide these
data to researchers and companies enabling them to redesign and restructure
their business activities. Additionally, government needs to update
infrastructure, strategies and other related issues according to new challenges
and changes in technologies. Companies should monitor their business
activities, website visitors and their interest and new technology and develop an
understanding of their user’s behaviour and be technologically up-to-date.
Thus companies need to update their websites with information to keep
customers coming back and using the services. Furthermore, technologically
advanced countries could help Libya to monitor the use of the bought or
licensed technology and advise on ways to maximise the use of that technology
as well as helping Libya to keep up-to-date.
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 Online promotion: companies have to pay attention to online promotions and
marketing issues to attract customers to their websites. These customers could
be from Libya or from any other part of the world.
 Customer satisfaction and customer trust: government and companies
should satisfy their customers with the services provided. This may generate
more use of the service and help in promoting e-commerce services to other
citizens. Additionally, satisfied customers should trust the service provider
which will create a special relationship between the provider and the consumer.
Thus this relationship should result in more involvement in e-activities.
 Culture, religion and value (see Section 7.4.1, 7.4.2)
 Training and education: (see Section 7.4.1, 7.4.2)
Table 8.3: After-adoption issues to Libya
Technological
Governments
E-commerce
Companies
advanced
countries
After-adoption
user
Security Y Y Y
Monitoring and updating Y Y Y
Online promotions Y
Customer satisfaction and customer trust Y Y
Culture, tradition and value Y Y Y Y
Training and education Y Y Y Y

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The three stages of adoption are illustrated in the Figure 8.2 below. The adoption will
depend on the amount Libya is willing to invest in the technology as well as the stage of
development for infrastructure. The quicker Libya acts to deal with the adoption stages, the
faster the adoption of e-commerce should be and the faster the economy should develop.
Before-adoption During-adoption After-adoption

Infrastructure
Payment system Security Training
Legislation and regulation International payment Monitoring and Updating
New business strategies and models Encouraging expatriates to return Security
Establishing e-commerce department Change in business culture Culture, religion and values
Customs and free markets Culture, religion and customs Training and education
Education and training Training and education
Culture and religion
Figure 7.2: The adoption stages
The three stages of adoption (before, during and after) are driven by the four e-commerce
adoption actors (Government, Technologically-advanced countries, companies, and e-
commerce users). The adoption actors and stages together complete the digital economic
activities in Libya and create the complete moon. Each of the four actors has a different
role to play. However, the importance of each actor is different from one country to
another. The government in Libya plays an important role as it controls most of the
organisations, banks and service providers (see 8.3 below).
The result of the three actors’ activities (Government, technologically-advanced countries
and companies) affects the involvement of e-commerce users and completes the moon
circle. For example, if government manages to encourage users to use e-government
services by providing most services online or reducing the cost of service charges online
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rather than the traditional way, then one could argue that users could be positively
influenced to engage in e-commerce activities. The three-quarter moon model describes the
whole adoption of e-commerce in Libya. It is called a three-quarter moon model to
illustrate the way that the three main actors (Government, technologically-advanced
countries and companies) encourage the fourth player (e-commerce users) to get involved
and complete the adoption.
The three players should pay attention to culture, religion and value, and training and
education over all the adoption stages. The conflict of e-commerce with Libya’s culture or
religion may drive users away of using the technology. Therefore companies and
government should monitor culture and values over all adoption stages. Further, culture
would be affected by e-commerce activities, so companies and government should work
closely to monitor the change in the country’s culture and meet the new needs or help
restoring some of the culture aspects that may have been affected by e-commerce.
Additionally, training and education is the responsibility of government, companies, and
technologically-advanced countries. Libyan people should be encouraged to be trained and
educated and to carry out research and development to meet the rapid development in the
world and keep the economic growth of the country sustainable.
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Figure 7.3: The Three-Quarter Moon Model (specific to Libya)
Companies
E-Commerce Adoption
Government of a country
Before During After
E-commerce user
Import technology
EC department Monitoring and updates
Change organisation
Infrastructure Online promotion
Culture
Payment system Security
Training and education
New strategies Customer satisfaction
International payment
Remove restriction Fit with culture change
Security
Technologically
advanced countries
Training and Education
7.5 The Three-Quarter Moon Model (General)
The three quarter moon model was designed specially for Libya, however, the model can be
more generalised to be used by other countries. For countries that have adopted a capitalist
approach for their economy, the effect of government will be much less than countries that
have adopted a socialist approach. The argument here is, whatever the type of approach the
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country is using, the same issues of e-commerce drivers and barriers have to be dealt with
in order for the adoption to be successful. Of course, the method of adoption and role of
actors will be different in each country.
This section introduces the use of the three-quarter moon model in these different countries,
and describes the deployment formula which can be used to indicate the level of
development needed to progress to full e-commerce adoption.
7.5.1 Capitalist approach

Capitalist countries will encourage private companies to be more involved in economic
development and infrastructure investment. Therefore, local companies and/or international
companies in the local market will have more power in that country’s economy and will be
the organisations responsible for the development. Even so, the government will still have a
major role to play. For countries that are technologically strong, the effect of international
companies will be limited. These countries will have their own technologically advanced
companies who will be able to help in implementing the technology. In the plan of actions
the roles of actors (government, international companies, local companies and Internet
users) will change. The change of the plan of action is discussed as follow:
7.5.1.1 Before-adoption
In the before-adoption stage, most of the issues will remain the same. However, a change in
the role of the actors may be required. The level of change will depend on the level of the
country’s development and the effect of the capitalist approach in that particular country.
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The investment in a capitalist country’s infrastructure will very likely be controlled by
private companies (national or international). Private companies can help the development
and increase the competition in the market which may result in reduction of costs and being
up-to-date with technology. However, private companies will very much consider the
economic benefit and profit more than other infrastructural and social benefits of that
country, therefore a government has to consider such involvement and encourage the
private companies to invest in the market. The same situation will apply to the postal
infrastructure, payment system and other issues. For example, postal investor companies
may not wish to consider distribution to small villages in the middle of the dessert of Chad
to serve a small group of people. Additionally, the barriers of setting the legislation and
regulation in a country will be affected by the involvement of investors in that market,
which may result in shifting the activities and considering the benefit of the companies in
the market without paying attention to the citizens of that country. Other issues such as low
cost of equipment and removing barriers for foreign investments would have been dealt
with once the country has a capitalist approach. Table 8.4 below lists the issues and shows
the actors’ involvement in each issue.
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Table 7.4: Before-adoption issues (general)
Technological
Governments
E-commerce
Companies
advanced
countries
Before-adoption
users
Telecommunication infrastructure Y Y
Postal infrastructure Y Y
Payment system Y Y
Legislation and regulations Y Y Y
Education and labour training Y Y
E-government strategy Y Y Y
Low cost hardware and software Y Y
International trade Y Y Y
Removing barriers for foreign investments Y Y
Establish an e-commerce department Y Y Y
Lowering taxations
Culture, religion and values Y Y Y Y

7.5.1.2 During-adoption
Once the before-adoption issues are dealt with, and a country is in the during-adoption
stage, a country’s actors would have to deal with other issues such as local languages,
credit cards, international payments and changes in the business culture. The government of
a country will have a very limited involvement in such issues. Companies in the market
will be involved in the during-adoption stages and will design the new changes in the
country to their organisation’s benefit. For example, companies who are based in a country
using an international and a local language (such as South Africa where English and other
local languages are used) would not bother to develop the system to retain the use of the
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local language, whereas a governments of other countries may well considered such
change. Table 8.5 below shows the change in actors’ roles during the adoption stages.
Table 7.5: During-adoption issues (General)
Technological
Governments
E-commerce
Companies
advanced
countries
During-adoption
users
The use of local languages in website Y Y Y
Accept credit card and international payments Y Y
Transaction security Y Y
Encouraging expatriate workers to return from overseas Y Y
New strategies for government and businesses Y Y Y
Change business culture Y Y
Security Y Y
Culture, religion and value Y Y Y
Training and education Y Y

7.5.1.3 After-adoption
In the after-adoption stage, companies would work closely to maintain a growth in e-
commerce and increase the number of users and value of sales. The after-adoption issues
would have to be dealt with in order to secure a smooth development of growth of e-
commerce. Government will have to keep a close eye on the development and guarantee
the positive effect on that country’s economy. Table 8.6 lists the change of the actors’ role
in the after-adoption stages.
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Table 7.6: After-adoption issues (general)
Technological
Governments
E-commerce
Companies
advanced
countries
After-adoption
users
Security Y Y
Monitoring and updating Y Y Y
Online promotions Y
Customer satisfactions and customer trust Y
Culture, tradition and value Y Y Y Y
Training and education Y Y Y

7.5.2 Socialist approach
For developing countries similar to Libya, the Three-Quarter Moon Model may be
successful for e-commerce adoption. The reason is that such countries may share most of
the economic tools and activities with Libya. However, a country needs to be careful
because what will work for one country may not work perfectly for others. Therefore, the
government of a country has to examine all adoption proposed issues and test them in their
economy before-adoption.
7.5.3 Technologically advanced countries
For technologically advanced countries such as India, the use of international technological
companies would be limited. Such companies exist in the market and can provide services
at competitive prices, therefore the effect of the international advanced companies in that
country will be limited. However, there will always be a need for sharing and transforming
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experience and knowledge. Therefore, the generic Three-Quarter Moon Model can be as in
Figure 7.4
Figure 7.4: The Three-Quarter Moon Model (General)
Companies
E-commerce Adoption
Government of a country
Before During After
E-Commerce user
Import technology
EC department Monitoring and updates
Change organisation
Infrastructure Online promotion
Culture
Payment system Security
Training and education
New strategies Customer satisfaction
International payment
Remove restriction Fit with culture change
Security
Technologically
advanced countries
Training and Education
The arrow in the three quarter moon model can be moved according to the involvement of
each actor in a country’s economy. The question to be raised here is “how can a country
know which stage of the adoption they have reached?” Therefore deploying the Three
Quarter Moon Model formula and diagram are introduced next.
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7.5.4 Deploying the Three Quarter Moon Model
The Internet involvement formula is the place to start.
7.5.4.1 Understanding the Internet involvement formula
The level of Internet involvement in a country’s economy can be a measure of the level of
engagement with e-commerce. The reason of developing the e-commerce involvement
formula is that all e-commerce activities have to be carried out over the Internet regardless
to the type of service. This involvement can be calculated by dividing the number of
Internet users in the country by the over-six population of the country (assuming that
children under six years of age will not be using e-commerce). Further, the OLPC project to
provide children in developing countries with laptops will result in more involvement from
the younger generation who enter school at the age of six. Hamed (2008) explained that the
reason for using the number of Internet users in a country is that the number of Internet
users is a result of all government and company economic and infrastructure activities. This
Internet involvement metric could be used to indicate the digital development of a country
as shown below (Hamed, 2008).
Number of Internet users in the country x 100

Internet involvement =
Country’s Population – Number of children under 6 years
This metric can now be used in a classification model that attempts to indicate where a
country currently is on a scale of technological development.
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7.5.4.2 The classification model
The classification model examines the e-commerce drivers and barriers of a country which
will depend upon the level of technological involvement with e-commerce and its effect on
a particular economy. This classification could be, based on three basic milestones: non-
technologically advanced, less technologically-advanced and technologically-advanced
countries.
Hamed (2008) argued that there are many issues that could count as drivers or barriers to e-
commerce. Once these issues play a greater driver role than barrier role, then one could
argue that the country is less-technologically advanced or technologically advanced. The
reason for the classification is that if a country is managing to adopt e-commerce such that
it is affecting economic activities, the government will have dealt with all infrastructure
issues, payments system issues, regulation etc. e.g. if a country has adopted e-commerce
and managed to reduce costs by more than the cost of establishing e-commerce then the
economy would be more developed than previously (Rostow, 1984). The non-
technologically advanced countries are those countries in which the infrastructure issues,
payment system issues, regulations, etc. are not yet implemented.
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Figure 7.5: The classification model
Barriers Drivers
0 25 50 75 100
Non-Technolgically Less-Technologically Technologically

Advanced Advanced Advanced
7.5.4.3 Deploying the formula in the classification model
If the result places a country in the non-technologically advanced category, then the country
will have to start at the before-adoption stage. This means that a country has no
infrastructure to support e-commerce, or there are some complications for different
infrastructures to work together and with other issues such as regulation, payment, etc.
Therefore these countries have to re-examine all before-adoption aspects and adopt the new
strategies for e-commerce activities.
If the result of the Internet involvement formula places a country in the less-technologically
advanced category, then the country could start the adoption from during-adoption stage.
This means that a government has managed to establish the basic infrastructure for e-
commerce which has resulted in a reasonable involvement of Internet users. The
government should pay attention to international payment and other aspects mentioned in
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the during-adoption stage to keep user-involvement and attract new users to electronic
activities.
Finally, if the formula resulted in placing a country in a technologically advanced category,
then the country has managed to establish all the necessary aspects for e-commerce use,
and therefore the country should work carefully with the after-adoption stage, satisfying
customers as well as other issues such as privacy, intellectual property, etc.
7.5 Summary
There are many drivers and barriers to e-commerce. However, most of these issues (cost,
infrastructure, time, information, legislation and regulation, etc) could be drivers or
barriers. If a country has managed to achieve cost reduction greater than the investment
made in adopting the new technology then one could say that the cost factor is a driver
rather than a barrier. The same philosophy could work with other aspects of e-commerce
drivers and barriers.
In order for a country to successfully adopt e-commerce, a government will have to think of
e-commerce issues and their effect on their economy. For a successful e-commerce
adoption, the government will have to implement the action plan. The action plan consists
of three stages of implementation (before-adoption, during-adoption and after-adoption).
Each stage has a number of issues to be dealt with. For example, a government will have to
deal with telecommunication infrastructure issues before the adoption of e-commerce.
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Failure of the adoption may be a result of a failure of one issue or a failure of a number of
issues together. Therefore the Internet involvement formula should help to indicate where
the problem lies. For example, by applying the number of internet users, population of a
country and children under 6 years of age to the formula, the result will give us an
indication of where the country lies in the diagram (figure 7.5). If a country lies in the non-
technologically advanced level, then a country have to review Before-adoption action of
plan issues that are listed in Table 7.1.
The action plan is driven by the four main actors (government, technologically advanced,
companies and e-commerce users). The involvement of the fourth actor is the result of the
other three actors’ actions on the economy. The action plan and the e-commerce adoption
actors together create the Three-Quarter Moon Model.
The model was designed specifically for Libya. A generalisation of the model was
introduced and a table of actions for the action plan was introduced for other developing
countries. Additionally, a formula for measuring the e-commerce level of involvement in a
country was introduced. The calculation attempts to specify the stage of adoption the
country is at. After applying the formula, the result will be applied to the classification
model which classifies a country according to its advancement in technology (non-
technologically advanced, less-technologically advanced and technologically advanced).
The action plan, the Three-Quarter Moon Model, the formula and classification diagram are
proposed but not yet implemented in any country.
265
Chapter eight: Conclusions
266
Chapter eight
Conclusion
267
8.1 Introduction......................................................................................................................................... 270

8.2 Review of objectives ............................................................................................................................ 270
8.2.1 Reviewing the literature of Economic development ......................................................................... 270
8.2.2 Reviewing the literature of e-commerce ........................................................................................... 271
8.2.3Developing a theoretical framework to conceptualise e-commerce drivers and barriers ................... 272
8.2.4 Investigate practical drivers and barriers of E-Commerce and its impact on Libya’s economy ....... 273
8.2.5 Develop an implementation plan for e-commerce adoption in Libya ............................................... 279
8.2.7 Develop a model to assist in E-Commerce adoption in Libya and consider how the model can be
generalised for other developing countries ................................................................................................ 279
8.3 Contribution of the body of knowledge ............................................................................................. 281
8.3.1 Contribution to theory ....................................................................................................................... 281
8.3.2 Contribution to Practice .................................................................................................................... 287
8.4 Limitations of the research................................................................................................................. 288
8.5 Recommendations ............................................................................................................................... 289
8.6 Future Research .................................................................................................................................. 290
268
269
8.1 Introduction
This chapter summarises the thesis and draws conclusions from thesis objectives, literature
review, findings and model chapters. Recommendations are made to the Libyan
government regarding e-commerce and Internet adoption. Recommendations are also made
for e-commerce and Internet adoption in developing countries generally. Finally,
recommendations are made for further studies to be made on the subject of e-commerce and
developing countries.
8.2 Review of objectives
8.2.1 Reviewing the literature of Economic development
It is now widely accepted by policy makers and society that e-commerce is an economic
and social transformation method that is affecting all countries. E-commerce has created a
new economic and social landscape.
The more rapidly the technology is adopted and put to work in an economy, the more likely
it is that the pace of economic growth will be rapid. The successful introduction of
technology into the domestic production process in any country requires a domestic
scientific establishment capable, first, of understanding, processing and adopting foreign-
produced technological knowledge to local conditions and recognising the potential and
dangers of its own discoveries when applied to the domestic economy.
270
Advances in information technology have done more than almost anything else to drive the
last decade’s economic boom and the integration of markets around the planet. The
investment in the digital infrastructure that supports these burgeoning new services from
the Internet servers to fibre-optic networks has itself become a major engine of economic
growth. The impact of investment in ICT on economic growth is commonly regarded as a
major driver of the new economy. However, ICT offers great benefits when ICT investment
is combined with other organisational assets, such as new strategies, new business
processes, new organisational structures and better educated and trained workers.
Even so, the majority of developing countries face limitations on the development of their
economy stemming largely from low income levels, low literacy rates, lack of payment
systems that can support online transactions, and cultural resistance to online trade.
8.2.2 Reviewing the literature of e-commerce
Electronic commerce is the practice of conducting trade and retail business online through
the use of secure websites. With the latest computerization and Internet technology, the
future of international business for all personal or commercial investment companies
involves e-commerce and all it has to offer.
The Third World has huge and well-recognised e-commerce and marketing potential. The
potential of e-commerce applications to enable access to global markets and to reduce
barriers to market entry is a theme which is heavily emphasised in the burgeoning literature
271
on e-commerce for developing countries. E-commerce enables producers in the developing
world to overcome traditional limitations associated with restricted access to information,
high market-entry costs, and isolation from potential markets.
8.2. Developing a theoretical framework to conceptualise e-
commerce drivers and barriers
E-commerce is expanding rapidly and has facilitated changes by significantly reducing the
costs of outsourcing and co-operation with external entities. E-commerce has helped to
break down the natural monopoly characteristic of services such as telecommunications. E-
commerce is a key technology for speeding up the innovation process, reducing time scales,
fostering greater networking in the economy and making faster diffusion of knowledge and
ideas possible.
E-commerce drivers vary from one country to another. Some drivers that are seen in some
developed countries are not yet evident in many developing countries and in some cases
those drivers in a developed country could be barriers in other countries. There are a
number of barriers to the adoption e-commerce (see Section 4.3) such as security, taxation
or even in some circumstances, too much business for a company to cope with. Users in
developing countries are likely to be engaged in making improvements to their operations,
often focusing on production management, financing and accounting, product development
and marketing rather then paying attention to e-commerce strategies.
272
Reviewing the literature resulted in developing a framework to conceptualise e-commerce
drivers and barriers. This framework consists of number of issues that can be drivers and
barriers for e-commerce adoption. These issues are cost, payment systems, legislation and
regulation, infrastructure, culture and religion, government, employment, competition,
traditional business and economic activities. Each of these issues can have its effect on the
country’s economy. For the country to guarantee a success of e-commerce adoption, the
government has to make sure that they have dealt with barriers and sustain the drivers of
each issue.
8.2.4 Investigate practical drivers and barriers of E-Commerce and
its impact on Libya’s economy
E-commerce should increase the efficiency of Libya’s economy by making products higher
quality and customer service more efficient. The Libyan economy will gain many
advantages from e-commerce that will totally change the way that businesses operate. E-
commerce is rapidly changing the foundation of Libyan government policies and improving
their online communication strategies for expanding their economy.
8.2.4.1 E-commerce drivers and barriers in Libya
There are many drivers and barriers to e-commerce. Most issues (cost, infrastructure, time,
information, legislation and regulation, etc) could be drivers or barriers. If a country has
273
managed to achieve a cost reduction greater than the investment made in adopting the new
technology then one could say that the cost factor is a driver rather than a barrier. The same
philosophy could work with other aspects of e-commerce drivers and barriers. The
government has to bear in mind the effect of issues on social, political and other aspects in
the country.
Cost is an important factor for the world’s e-commerce in general and for Libya in
particular. Reduction of costs using Internet technology is one of the main drivers for e-
commerce in Libya. The results of this research show that e-commerce reduces the cost of
communication and delivery in Libya as elsewhere. However, the cost of Internet
connection in developing countries, and Libya in particular, is moderately high compared to
developed countries.
The absence of e-government is another barrier for e-commerce in Libya. E-government is
significant factor for e-commerce as it delivers services to businesses and the public. Even
though e-government services are still at a very basic level, the Libyan government has
started to think seriously about e-government as an important tool for economic
development.
Libya has no electronic payment system in place as yet. Most international payment
transactions are carried out by a third bank located outside the country. The lack of an
electronic payment system has delayed the adoption of e-commerce as well as encouraging
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Internet users to adopt hacking approaches in order to use some Internet services. However,
Libyan organisations are pushing the government to adopt an alternative electronic
payment system. Moreover, the pressure of private sector companies has encouraged the
Central Bank of Libya to adopt an electronic payment system which will link banks in
Libya, which will be a driver for e-commerce.
The Libyan infrastructure for the Internet and e-commerce needs to be developed for the
benefit of e-commerce and other advanced technologies. The introduction of wireless
technology in rural areas and desert locations will help people to engage with e-commerce.
Furthermore, e-commerce legislation and regulation needs to put in place.
One of the most controversial aspects of e-commerce in countries like Libya is the
availability of pornography, pirated products, and other illegal activities. These create
security and legal issues that may never have total solutions. Security can affect
organisations in a number of ways including the security of information.
Traditional businesses and user behaviour needs to be developed to cope with the new
technology. One could argue that e-commerce may not pose a threat to traditional business
as a result of the low involvement of the older generation in e-commerce and the low
custom charges on the imported products. However, traditional businesses may face sharp
competition with e-commerce businesses in the future.
275
The research also indicated that a society’s culture, traditions and values may be barriers to
e-commerce in terms of intervention to ban the sale of certain items that violate such
culture, traditions and values.
Electronic illiteracy and lack of e-commerce knowledge is another important barrier, as is
the fact that most Internet content is English, which limits the involvement of non-English
speakers. However, the OLPC project is considered as a potential driver for e-commerce in
Libya. The OLPC project will encourage the younger generation and their families to be
involved with e-commerce and Internet.
Libyan companies need to change their business structure. Information systems
infrastructures require restructuring and business strategies will need to be reformulated.
Firms need to carefully consider and create a business model that will be applicable to the
Internet and will need to ensure that the Internet matches their organisation’s business
objectives. Governments must bring down the different barriers that impose constraints on
e-commerce, such as taxation, extensive regulation and censorship, and let e-commerce
mature in an environment driven by markets. Also, governments should support the
creation of a legal framework for doing business on the Internet. Additionally the cost of
connection is a challenge. Add to this the human capital cost of installing, operating,
maintaining, training and supporting that is beyond the means of many enterprises in
developing countries.
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8.2.4.2 The impact of e-commerce drivers and barriers on Libya’s
economy
The two main driving forces behind the new economy are the Internet and e-commerce. E-
commerce has had a significant effect on economic development. This research shows that
e-commerce will help to develop Libya’s economy. Libya is a consumer-market, relying on
imported products; therefore consumers would save money by paying less for goods and
services. This money could be reinvested and contribute positively to the economy of the
country. E-commerce may result in job cuts. However, adopting e-commerce technology
will not reduce employment in Libya. Rather, it could result in creating new job
opportunities and force employees to gain new skills.
The importance of Libya’s location and its tourism potential will create new economic
activities in the country. E-commerce would certainly help to develop the tourism industry
in Libya as tourists and tour organisers were among the first to use the Internet and this has
now become standard practice. Libya has many potentially attractive historical sites that
could form the bases of a lucrative tourist industry.
Agriculture could also benefit from e-commerce. Libyan agriculture is well established and
known for its low prices and fine quality. E-commerce will enable farmers in Libya to
export their products and increase their production which will lead to significant economic
activity in the country. The increase in production will result in greater savings and
investment and hence in developing the economy.
277
E-commerce in Libya should not pose any threat to traditional businesses (off-line and
importing businesses). Libyan markets could be described as consumer-markets rather than
productive markets. Most of products in Libya are imported from overseas and sold at good
prices to end consumers. Therefore e-commerce could not compete with traditional
business methods. Rather, traditional businesses in developed countries have demonstrated
that adoption of e-commerce has been successful in improving their services. The
traditional trade infrastructure is well established whereas the e-commerce infrastructure,
particularly that of order fulfilment, hardly exists. However, with the increase of e-
commerce popularity and infrastructure improvement, one could argue that E-commerce
may pose some threat in the future as new, advanced technology equipped companies are
established and put pressure on traditional businesses.
Although e-commerce may disrupt a country’s economy at first, the country should adopt
the technology in order not to be left behind. The longer the delay to e-commerce adoption,
the bigger the gap may be between that country’s economy and the economy of advanced
nations. As a result of the research findings, it was clear that a strategy is needed in order
for the government of Libya to assure the successful adoption of e-commerce.
278
8.2.5 Develop an implementation plan for e-commerce adoption in
Libya
A plan of action was introduced for e-commerce adoption in Libya. Because of
complication of e-commerce issues and the links between each and every one of the issues,
there is a need to put a plan of action in place that the government will have to undertake to
guarantee the adoption. The plan of action consists of three stages consisting of issues that
must be dealt with before, while and after-adoption. The failure of adoption may be a result
of a failure of one issue or a failure of a number of issues together. The plan of action will
be delivered by a number of e-commerce actors. Actors are different from one country to
another. For example, in Libya most of the issues are the Libyan government’s
responsibility whereas in other countries the same issues may be the responsibility of the
national or international companies in the market. The plan of action and the e-commerce
actors create the Three-Quarter Moon Model.
8.2.7 Develop a model to assist in E-Commerce adoption in Libya
and consider how the model can be generalised for other
The Three-Quarter Moon Model proposes a solution for e-commerce adoption in Libya.
The Three-Quarter Moon Model consists of the plan of action and e-commerce actors. All
action plan issues are driven by four main actors (government, technologically advanced
countries, companies and e-commerce users). The involvement of the fourth actor (e-
279
commerce users) is the result of the other three actors’ actions on the economy. These three
actors comprise the Three-Quarter Moon that encourages the fourth actor to complete the
circle of adoption. The Three-Quarter Moon Model was designed specifically for Libya. A
generalisation for the model was suggested for other developing countries.
The Three-Quarter Moon Model can be generalised to work with other developing
countries. The generalisation proposes a solution for countries according to their economic
approaches (capitalist or socialist). The generalised model consists of the same issues and
plan of action as Libya with a change in the role of e-commerce actors. In capitalist
countries, most of roles will be played by the national and international companies rather
than the government. However, the government still has important roles to play.
Additionally, it introduces a new classification model in order for countries to examine the
level of adoption they have already achieved. The new classification uses drivers and
barriers. The classification model divides countries according to their technological
advancement. The new classification groups countries into non-technologically advanced,
less-technologically advanced and technologically advanced. The classification model
introduced a formula for Internet involvement. Applying the formula to a specific country
results in a measure of Internet involvement in that country, which can then be applied to
the classification model to identify the country’s level of adoption.
280
8.3 Contribution of the body of knowledge
The research described in this thesis has led to the following achievements and novel
contributions: the research provides an understanding of the e-commerce situation in Libya;
this has led to a contribution to e-commerce theory by establishing the drivers and barriers
to e-commerce adoption in Libya. Additionally, a new model for e-commerce adoption the
‘Three-Quarter Moon’ was developed to help countries like Libya to adopt e-commerce,
avoiding adverse effects on the economy and following prescribed stages to complete the
adoption.
8.3.1 Contribution to theory
8.3.1.1 New knowledge about literature of e-commerce and economic
development
E-commerce drivers and barriers issues were established from reviewing the literature of e-
commerce and economic development and then examined in a Libyan context. As a result
of the examination, most of the issues were confirmed, some were not, some new sub-
issues and two new issues were identified.
For the competition issue, all the issues identified in the literature were examined and
confirmed by the interviewee’s comments. However, the research adds to this literature:
- the lack of e-commerce infrastructure in Libya was the result of the delays of e-
commerce competition in the country.
281
- the lack of competition in the market is because of the low level of involvement of
the older generation who prefer using traditional business methods for their
activities.
For the cost issue, some problems identified in the literature were not evident in Libya due
to the early stages of adoption in Libya. For example implementation and maintenance
costs were identified in the literature and therefore expected (especially for the private
organisations) but was not encountered. The research also indicated that e-commerce in
Libya should help in reducing the cost of bank transactions.
For the culture issue, the research findings confirmed the effect of culture on the adoption
of e-commerce. However, the research findings also indicated that e-commerce may help to
maintain Arab culture by providing opportunities for Arab women to work and shop from
home. It also suggested that training and education may help to change the cultural
prejudices against e-commerce and that pressure from government on citizens to use e-
commerce may result in significant engagement in e-commerce.
The economic development literature indicated that the cost of adopting e-commerce
technology was expected to be a barrier as it may affect other development in the country.
This research indicated that e-commerce adoption should work as a driver for Libya. E-
commerce adoption should also encourage the opening of the markets and the involvement
of international investors as well as creating opportunities for business in the country. E-
282
commerce adoption is expected to work positively with the market. The research findings
stated that training and education is an important issue for economic development.
Unemployment in Libya is a result of economic activities and not e-commerce alone. It was
argued that the employment rate did not change much over the last decade in other
countries from before the introduction of e-commerce. Additionally, training and education
for employment is essential to be able to find new jobs and gain new knowledge.
Government is still playing an important role of e-commerce adoption, especially in Libya.
However, people will not wait for the government to formulate legislation; they will start to
use e-commerce once it is ready in the market. Therefore countries have to work towards
introduce legislation and regulation to control e-commerce activities. Training and
education for government staff and people are needed to understand safe methods of using
e-commerce and how to sustain citizen’s rights.
The lack of infrastructure drives organisations and businesses to break the law to use e-
commerce. For example, companies using satellite technology to connect to the Internet.
The need for new strategies and management for the infrastructure was not considered
important by the government which may result in serious delays in the adoption of e-
commerce.
The difficulty of establishing legislation by one government alone and the conflict with
other regulations in the country was identified. As the legislation development has yet to be
283
completed, the issues will remain unconfirmed. The new regulations are a result of e-
commerce users in the country which gives the government no option but to begin e-
commerce regulation. Additionally, the absence of regulation drives businesses away from
the market to somewhere else where business can operate. Also, there is a need for training
and education of users as regards e-commerce regulation: their rights and how they can
protect themselves while using the Internet and e-commerce.
Because of the absence of an electronic payment system in the country, many organisations
(public and private) started planning to introduce alternative payment methods for e-
commerce use in the country. For example, the top-up cards for shopping by LIB.
Traditional businesses in Libya will not be affected seriously by e-commerce because the
the majority of users in Libya are teenagers. Additionally, the reduction in customs and
taxes will help traditional businesses to be competitive with e-commerce traders by
providing cheaper overall prices for imported products.
Examining e-commerce driver and barrier issues in Libya resulted in the identification of
new issues. It was advocated that the need of education and training is necessary for each
and every issue of e-commerce drivers and barrier. This research has introduced knowledge
of e-commerce as a separate issue. Knowledge can be a driver for developing the economy,
training employees and creating new jobs. However, it also can be a barrier for poorer
countries that have to send trainees overseas to be educated and trained.
284
Another issue identified as a result of this research is security. Security is an issue related to
lack of regulation and legislation. However, the researcher identified security as an issue on
its own. Security has relationships with each and every issue of e-commerce drivers and
barriers. Adopting security in the market will be a driver for e-commerce adoption and will
encourage people to start using the e-commerce. Thus a security market will create
opportunities for national and international companies to be involved in and provide
opportunities for employment in the market. However, security can be a barrier for e-
commerce adoption. Providing security by international companies may result in spying on
government activities and information. Also, systems security may be to complicated to use
which may discourage people from using e-commerce.
8.3.1.2 The Three-Quarter Moon Model
The research findings and discussion has resulted in introducing the Three-Quarter Moon
Model. The Three-Quarter Moon model is designed specifically to assist Libya’s adoption
of e-commerce. The model consists of a plan of action (a to-do list of issues) and the e-
commerce actors (government, local companies, international companies and Internet
users). The plan of action divides the adoption into three stages: before-adoption of e-
commerce, during-adoption and after-adoption. In each stage there are issues to be dealt
with. A failure of e-commerce adoption according to the Three-Quarter Moon Model may
be the result of one or more issue.
285
8.3.1.3 Generalisation of the Three-Quarter Moon Model for other
The Three-Quarter Moon Model was designed for Libya; however, a generalisation of the
model was introduced to be used for other developing countries. The generalisation of the
model suggests a possible change of roles for the e-commerce actors and introduces a
modified plan of action for other developing countries according to their economic
approach (capitalist or socialist). Also it provides a classification for other technologically
developed countries. Countries will be different in their level of e-commerce adoption and
involvement; therefore a classification model was also introduced
8.3.1.4 New classification model and Internet involvement formula
The classification model was introduced to calculate the level of e-commerce adoption.
Countries will work differently with e-commerce, therefore, the classification model has
divided countries according to their level of technological involvement into three categories
(non-technologically advanced, less-technologically advanced and technologically
advanced). If a country is classified as non-technologically advanced, then the
infrastructure and other issues in the before-adoption plan of action have to be addressed. If
classified as less-technologically advanced, then the during-adoption issues need
consideration. If the country is classified as technologically advanced, then the country’s
adoption of e-commerce was successful but now the country should pay attention to other
issues in the after-adoption plan of action.
286
The Internet involvement formula helps to classify countries in the model. The formula
measures Internet involvement in a country. It divides the number of Internet users in the
particular country by the population excluding those under six years. The result of the
formula classifies the country in the classification model.
8.3.2 Contribution to Practice
8.3.2.1 Plan of action for e-commerce adoption
The plan of action is a set of actions a country has to take in order to guarantee the
successful adoption of e-commerce. The plan of action consists of three stages: before-,
while- and after-adoption. In the before-adoption stage, the country has to pay attention to a
number of issues such as the infrastructure of the country, implementing a payment system
and finding a government department to be responsible for e-commerce adoption. Once the
before-adoption issues are dealt with and e-commerce is beginning to be used, the
government enters the during-adoption stage. The during-adopting stage consists of a
number of actions that e-commerce actors have to deal with while in the process of
adopting e-commerce. For example, government, international companies and national
companies have to start implementing an international payment system to allow
international transactions between a country’s users and other businesses. The third level is
after-adoption issues. When a country comes to after-adoption issues, one could argue the
adoption of e-commerce has been successfully implemented in the country, therefore e-
commerce actors have to pay attention to other ongoing issues such as training, monitoring,
287
auditing, etc. The plan of action can be modified to work with any country. The issue
remains the actors of e-commerce adoption changing according the type of economic
approach adopted in the country. For example, in capitalist countries, private companies
will have more involvement in the development and implementation than the government.
In socialist economies the reverse is true.
8.4 Limitations of the research
The study was conducted in Libya. The rationale for choosing Libya was because Libya
was one of the developing countries that has attempted but failed to adopt e-commerce.
However, there are certain factors that researchers should take into consideration when
methods and techniques appropriate for study are being selected. For example,
 The research is a small-scale evaluation study, in which the research was
undertaken for a period of four years, this period was insufficient to indicate the
real effects of e-commerce.
 Interviewing candidates requires permission and consent from individuals or their
organisations. This issue drove the researcher to use some personal connections in
government departments and organisations in order for these interviews to be
conducted. Hence the potential for some bias was unavoidable.
 The study aims to propose a model for developing countries, but because of the
research timescale only one country (Libya) was investigated. The model and plan
of action were not implemented and therefore have not been validated.
288
 The generalisation of the Three-Quarter Moon Model was introduced but not
implemented in other countries. Therefore, the Three-Quarter Moon Model will
need to be implemented and validated in other developing countries.
8.5 Recommendations
The following recommendations are made to the Libyan government in particular and the
governments of other developing countries who are seeking the e-commerce adoption.
1. A country has to build an infrastructure for e-commerce. This infrastructure must
include ICT and delivery fulfilment.
2. A government department responsible for e-commerce has to be established.
3. The effect of e-commerce on the country’s culture and religion has to be
investigated to ensure that the adoption of e-commerce does not conflict with the
culture of a country in a way which would affect the adoption.
4. The topic of e-commerce must be introduced as a subject in schools and universities
and employees must be given appropriate training.
5. A country should encourage expatriate workers to return from overseas. The return
of these workers would result in reducing the cost of employment and attracting
other employees to follow the path of these workers.
6. A country should monitor e-commerce activities and their effects on economic
development.
289
8.6 Future Research
Further research could be carried out in the following areas:
 E-commerce in Libya still in its infancy, therefore a further study of the same
subject may result in different drivers and barriers of e-commerce resulting from
the rapid change in technology and other issues that may not have been observed in
this study
 The Three-Quarter Moon Model has been proposed to help developing countries to
adopt e-commerce. However, the model has not been validated. Therefore a study
deploying and evaluating this model would be appropriate.
 The Three-Quarter Moon Model has many factors and issues (e.g. cost, culture,
training, etc.) that the researcher could not investigate in detail through time
limitations. Therefore, future studies could examine these factors and issues and
provide a deeper understanding of each.
 M-commerce has been proposed as a solution for developing countries in adopting
e-commerce. A future study could investigate the opportunities for adopting M-
commerce in developing countries and African countries in particular, especially
after the launch of the African Telecommunication Satellite.
290
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291
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315
Appendices
Appendices
316
Appendices
Appendices
10.1 Interviewees’ comments tables: ....................................................................................................... 318

10.1.1 Data gathered: Use of tables............................................................................................................ 318
10.1.2 Important: example of use of tables ................................................................................................ 320
10.1.3 Competition:.................................................................................................................................... 322
10.1.4 Cost: ................................................................................................................................................ 326
10.1.5 Culture and Religion: ...................................................................................................................... 329
10.1.6 Economic Development: ................................................................................................................. 335
10.1.7 Employment: ................................................................................................................................... 342
10.1.8 Government :................................................................................................................................... 345
10.1.9 Infrastructure: .................................................................................................................................. 351
10.1.10 Knowledge: ................................................................................................................................... 358
10.1.11 Legislation:.................................................................................................................................... 362
10.1.12 Payment:........................................................................................................................................ 365
10.1.13 Security ......................................................................................................................................... 373
10.1.14 Traditional Business:..................................................................................................................... 375
10.2: Interview question .......................................................................................................................... 381
10.3 Questionnaires’ answers................................................................................................................... 385
10.4 Questionnaire questions ................................................................................................................... 393
10.5 Questionnaire questions linked to e-commerce issues ................................................................... 401
317
Appendices
10.1 Interviewees’ comments tables:
10.1.1 Data gathered: Use of tables

All E-Commerce drivers and barriers issues in the e-commerce Drivers and Barriers Model
(1) (see section 4.3) were examined across interviews. The original information was
gathered and listed. Each issue has its own table in the appendixes of this thesis. Each table
includes the interviewee’s organisation name, the interviewee position and his comments
related to a particular issue. Additionally, all original data were summarised and fit into
tables which present the research finding in this chapter. Each issue of the E-Commerce
drivers and barriers has its own section and its data presented in a separate table.
Each table consists of 6 columns stating the position of the interviewee, his organisations,
and his comments. Each of the comments has been directly related to the literature review
and the findings presented in each issue section. Below is a detailed explanation of these six
columns:
1. The first column contains the interviewee’s job title.
2. The second column contains the organisation’s name. the abbreviations used are
follows:
Table 10.1: list of organisation interviewed
Name of the organisation
MOC Ministry of Economy, Libyan government

Organisation of postal and telecommunication company, Libyan government
OPTC
company
LTT Libyan telecommunication technology, Libyan government company
LIB Libyanna Mobile company, Libyan government company
318
Appendices
LCB Libyan Commercial bank,

CBL Central bank of Libya,
BA Group, a group of companies in construction, financial and oil
BA
companies
CI Concord investment
OCC Oil and construction company
AW Al Wesam Internet Café
AR Al Reiad Internet Café
AL Al Mukhtar
OC Oil Company
3. The third column is for the interviewee statements. Their original statement (as in
the CD) were summarised to focus the interviewee point of view to the reader and
to enable researcher to link the statement to the literature review tables of each
section
4. The fourth column indicates whether the issue discussed is a driver (D) or a barrier
(B). The (F) indicates that the driver or barrier has been mentioned in this Finding
chapter
5. The fifth column indicates whether the issue discussed is a driver (D) or a barrier
(B). The (L) indicates that the driver or barrier has been mentioned in the Literature
review chapter
6. The sixth column. At the end of each issue section in the literature review, there is
a table summarising the arguments relevant to that issue, each argument being
numbered. Arguments are cross-referenced to comments in this column. In some
cases the comments can not be cross-referenced, in which case (-) is entered.
319
Appendices
10.1.2 Important: example of use of tables
In order for the reader to be able to use the table below, an example is demonstrated here.
For understanding the first statement mentioned in the competition table (table 12.2), the
comment sate “International companies know about E-Commerce but Libyan companies do
not”. This statement in the table stated by the undersecretary of the Libyan government
ministry of economy (MOE), the statement above resulted in this research finding as a
barrier in that the lack of Libyan company’s knowledge about electronic commerce can be
a barrier for Libyan company to compete against the International companies who have the
experience and knowledge of using E-Commerce and its activities. The same view is
confirmed in the literature, By reviewing table 4.8 in section 4.2.8 Which related to the
competition, statement number 4 states that competition could destroy small businesses.
These businesses could go elsewhere or cease to exist which will affect the economy badly.
The original statement can be seen in the competition appendices in the CD in the
competition table.
Another example could be giving is the second statement of the same table (table 12.2).
The comment in the table state “The competition in the commercial market is already
exists”. This statement confirm that the competition in the Libyan market was not because
of E-Commerce, it may even be that E-Commerce can be a solution for those traditional
businesses who do not have the time or the ability to travel somewhere to compete with the
importation. Such statement was not mentioned in the literature review, therefore (-) was
used to confirm that can be a contribution to the E-Commerce literature for Libya. The
320
Appendices
original statement can be seen in the competition appendices, in the CD, in the competition
table. The same example can apply to the other drivers and barriers issues in this section
321
Appendices
10.1.3 Competition:
Table 10.1: Competition issues in findings

D/B D/B
Job title Org comments No.
F L
Undersecretary M O E International companies know about B B 4
E-Commerce but Libyan companies
do not.
The competition in the commercial D - -
market is already existed.
Libyan producers are complaining D, B - -
that many international products have
interred the country through Libyan
importers or trader
E-Commerce will create more D, B D 2
competition in the market
Using the internet will drive many D, B D, B 2, 4
travel agencies to close
People will use the source rather then D, B D, B 1, 3,
a physical shop 4
E-commerce in developing countries D, B D 1
will sharp the competition
Competition could help developing D D 1, 2
the Libyan economy
Consumers can save money by using D D 3
E-Commerce and buying from source
Competition on employment will B B 4
increase because of E-Commerce
Reduction on customs and taxation D, B D 2
increases the competitions between
traditional traders and electronic
traders
E-commerce in developing countries D,B D, B 1, 4
will effect the competition.
Local suppliers and producers will D D 3, 4
have to provide a better services and
quality to face competition
322
Appendices
Competition did not really happen in D - -

many country and this fear start to be
disappeared.
Chairman OPTC Electronic competition in Libya still D, B - -

not seeing
E-Commerce will fast up the way of D D 2
doing work in the company. It will
reduce the expense of doing things in
a manual way.
Competition in employment D, B B 4
The readiness of country’s B - -
infrastructure will delay the
competition
There is no competitions of Internet B - -
services providers in Libya as all
owned by the same company which
owned by the government
The Internet providers in Libya going D, B - -
to be privatised
Business will shift their activities into D, B D, B 1, 4
the web
Payment system delays the adoption B - -
of electronic business
Marketing LTT Alternative payment system start D D 1
manager creating competitions between their
adopter and other traditional business
providers
Other companies start thinking of D - -
adopting alternative payment system
Payment system delays the B - -
competitions and electronic business
There is no domain registration B - -
competition in Libya as all provided
by one company
To coupe with demand LTT increase B - -
the charge of services
Marketing LIB E-Commerce will create competition D, B B 4
manager in employment
323
Appendices
Learning of other companies mistakes D - -

can be the way out of the problem
Internet services providers in Libya B B 1
are completing each others rather then
competing with each other
Operations LCB Absence of Electronic payment B B 1

manager system drove all banks in Libya to
deal with one International bank in all
their international activities
National payment system will create a D, B B 4
competition in employment
Bank will ask other technical D - -
companies to provide electronic
services such as web designing and
database links which will create
competition between IT companies
Internet is legally provided by only B B 1
one company in Libya
Competition between electronic and B B 4
traditional business may result in
disappearing the traditional
businesses from the market
Competition between electronic and - - -
traditional business will need time to
be seen in Libya
IT Manager CBL National payment system will create D D 1
an opportunity for Libyan companies
to provide business online
National payment system gives the D D 1, 2
opportunity to Libyan local bank to
operate and compete with
international banks
National payment system will create D, B B 4
competition in employments
Chairman BA Competition between traditional D D 1
telephone services and VOIP is
existed
324
Appendices
E-Commerce will create a D, B D, B 1,3,

competition between traditional way 4
and electronic businesses specially for
buying products and availability of
different type of products.
Competition is stronger between D, B D, B 1, 4
electronic businesses and more
stronger for traditional businesses
You have the opportunity to compare D D 3
prices for different products or even
for the same products, and as we all
know that Internet services are too
much lower then the high street prices
Libyan Market is consuming market, D D 3
it will not get effected from e-
commerce.
Libyan consumers will save more D D 2, 3
money and get better quality by using
E-Commerce
Libya’s agriculture products will not D D 1, 2
be competed because of its quality
and low price
Business CI Competition for employment will rise B B 4
development Competition between the same D D 1
manager services providers
Old generation do not care to use the B - -
E-Commerce
General OCC Competition between mail services D D 1

Manager provider will sharp
E-Commerce will create a benefit to D - -
all companies rather then competition
Internet Café AW E-commerce will bring many new D D 1

manager companies
For older companies to survive they D D 1
have to take the same bath along with
the traditional way.
325
Appendices
The reason of high Internet charge is B B 1

because of there is no completion.
Internet Café AR E-Commerce is much easy way of D - -

manager doing business then a traditional way
E-commerce has a big market, it a D - -
business around the glob.
Breaking the low to get a cheaper B - -
Internet connection
No competition between Internet B B 1
service providers kept the internet
connection charge high
Engineering OC In a market like Libya E-commerce D - -

manager and traditional business are barrel
Many traditional business are using D - -
the internet , it works perfect in both
sides. The future more likely to be
just e-commerce
10.1.4 Cost:
Table 10.2: cost issues in findings
D/B D/B
F L
Undersecretary M O E Increase importation D - -

Reduce the cost of products D D 6
Increase people saving D D 16
Reduce the cost of establishing new D - -
companies
Chairman OPTC Reduce the expense of doing things in D - -

a manual
Reduction on fixed line charge D B 13
Reduction on Internet connection D B 13
326
Appendices
Marketing LTT High charge for Internet connection B B 13

manager Charge for ATM technology for ADSL B B 14, 9
High charge to control high demand B - -

Reduction in cost by %70 D B 14
Marketing LIB Cost saving for paying bills and D - -

manager children school registrations
The cost of Internet per 1KB is 2 B B 13
Dirham,
M-commerce save money for building D B 14
the infrastructure
Reduces the employment D - -
Increase saving D D 16
Reduce the cost of travailing D - -
Reduce the cost of getting job done. D - -
Reduce the amount of money for D - -

printing top up cards.
Reduce the charge of service D - -
Operation LCB Reduce cost D D 1

manager Reduce employment. D - -
Cost of training for new system and B - -
language
Reduce the cost of transactions in D - -
banking businesses
Cost of connection B B 13
The cost of infrastructure (40M for B B 9,14
NPS).
cost of having website B - -
IT Manager CBL Saving resources D - -

Reduce employment D - -
Chairman BA Reduce huge cost. D D 1

Reducing general expenses D D 1
327
Appendices
Emails and VoIP reduce D D 2

communication cost (90%)
Reduce the cost of buying products D D 6
Reduce trading cost for importers D D 5,6
Reduce travailing cost D - -
Reduce cost and provide a better D D 1,8
services.
increasing production by saving the D - -
cost
reduce buying price D D 6
increase the saving D D 16
cost of connection B B 13
Business CI Reduce the cost of employments D - -

development Reduce the cost of printing D - -
manager Reduce the cost of communication, D D 2
Reduce marketing cost. D - -
Cost of connection B B 13
General OCC Reduce communication D D 2

Manager Reduce supplier communication D D 2,4
Cost of the internet connection is too B B 13
high
Internet Café AW Cost of connection is high B B 13

manager Cost of implementation is high for B B 9,14
privet business
Cost of PCs and Networks B B 9
Reduce buying cost D D 6
Reduce selling cost and increase D D 5
revenue
Reduce the cost of money transfer D - -
Internet Café AR Save money D D 16

manager Cost of web design B B -,9
Cost of hosting B B -,9
Cost of domain name B B -,9
Cost of submission to search engine B - -
328
Appendices
Cost of connection is high B B 13

Cost of computer literate employees B - -
Cost of computer and network B B 9

maintenance
Cost of training B - -
OC No comments
10.1.5 Culture and Religion:
Table 10.3: culture and religion issues in findings
D/B D/B
Job Title Org comments No.
F L
Undersecretary M O E Spread of Credit cards in Libya D D, B 3, 7

Needs for business culture change D, D 7
B
Libyan are resistance for culture B B 1
change
E-Commerce will change business D D 7
culture
Young generations will grow up with D D -
E-Commerce
Providing every house with PC may D D -
will change the culture
Education and reducing customs on D - -
technical equipment may help to
change the culture
Changes in the business culture will D - -
create money and help the economy
Change the business culture in the D D -

Ministry of Economy
Chairman OPTC OPTC start changing the business D D 7
culture
329
Appendices
Electronic way is much better than D - -

traditional way
There are also a culture barrier, B B 1
people needs to change the culture of B B 1, 2
caring cash or cheques into cards and
electronic payment
People still don’t have a culture of B B 1
writing a check how we expect them
just to accept e-commerce.
People needs to be forced to use for a - - -
first time,
Government and companies should D - -
help for changing the culture
Reduction cost can help in changing D - -
the culture
E-Commerce will change the business D, D 7
culture, many people will shift there B
activity into e-commerce ,
E-Commerce will be good for business D D 7

and customers if you manage to
change our business culture.
Its not only the technology will do the D - -

job, but also the willing of the people
themselves.
It’s important to push for new D D -
technology.
E-government is actually a challenge D - -
to be adopted
Marketing LTT Changes in payment culture needed D D 7
manager Banks and shopping centres start D D 7
providing alternative payment methods
to change the business culture
Foreign travellers are culturally ready D - -

to use E-Commerce
Locals will have difficulty to use E- B B 1
Commerce
330
Appendices
Locals will flight not to adopt E- B B 1, 2

Commerce
LTT enables Wireless Internet in the D D 7
desert
LTT enabled wireless services in D D 7
exhibitions
Educations and training needed to B - -
change the culture
E-Commerce will help people for their D D 7
activities rather then wasting time
Marketing LIB Customer can pay their bills by mobile D - -

manager
People need to save time for their daily D - -
activities
E-Commerce will help in change the D D 7
culture of carrying cash and cheques
In order to change business culture, D D 7

organisations needs to provide services
over the Internet
Education and training is needed to B - -
change the understanding of
technology and its benefit
Paying money for time services is not B B 1, 2,
allowed by Islamic religion 3
Technology give the freedom to D, B 1
different opinions and thought B
Tradition and custom will affect E- B B 1
commerce
E-commerce will change the way of D, D, B 1
living , B
E-Commerce will speed up the way D D 7
doing business,
E-Commerce makes people believe D - -
Time is money.
E-Commerce may effect the social life, D, D, B 1
B
331
Appendices
E-Commerce helps in administration D - -

work.
People believe that E-commerce will B - -
affect the employment rate in the
country and will slow the wheel of
economy development
E-Commerce create a new way of D D 7
thinking to do new job and develop
knowledge.
Traditional business is a time D - -
consuming,
E-commerce drive people to be more D - -
organised with there jobs and
payments.
Operation LCB Central Bank of Libya help other D D 7
manager banks to change their traditional
business methods.
Electronic services and cards will be D D 3, 7
introduces to all customers.
Next step is to adopt Internet Banking D D 7
Central bank of Libya is sending D - -

employees overseas for training
E-commerce bring the whole world D - -
together,
E-Commerce make communication D - -
and business easer.
E-Commerce helps banks to do there D D 7
transaction quickly and easily.
English language is a barrier for E- B - -
Commerce
People acceptance of new technology B B 1
is a barrier
E-Commerce still in its infancy to B - -
know its effect on culture
E-Commerce May effect traditional B - -
business
332
Appendices
IT Manager CBL Central Bank of Libya improving the D D 7

banking activity environment,
The new system settles the accounts of D D 7
banks and public institutions with the
CBL at every working day-end.
This system relates to electronic inter- D D 7

banks clearing of checks according to
scanning technique, paper files and
net-transaction posting to the clearing
Automated Clearing House System
ATM provides a fundamental D D 7

environment for the national
automated teller distributor
It also enables businessmen and D D 3, 7
companies to accept payments
electronically Training programs are
offered to all banks staff aimed at
qualifying national professionals
capable to mange and function all parts
of the project.
Chairman BA E-Commerce strategy has to fit with D D 1

culture religion and custom of the
country.
BA business culture has adopted the D D 7
email and VOIP
E-Commerce provide a better services D - -
and safe time and money
Culture and customs won’t make a D D 1
huge barriers to e-commerce
Religion will not make a barrier to E- D D 1, 5
Commerce
Human like to develop there skills, D D 1
Libyan are willing to change their D D 1
culture
333
Appendices
if e-commerce will get the right D D 7

structure in the country the result will
be encouraging
70-80% from consuming product has D D -
been imported from out side
Business CI E-Commerce makes customers trade D - -
development themseles
manager The higher population of internet user D, - 4
in the country are teenagers, B
Older people do not bother to learn B - -
new technology
Most of older and middle age people B B 1
prefer the traditional methods of doing
business.
Education and training is needed to B - -
change the culture of business
General OCC Using email as a main tool for business D D 7

Manager
Email is a low cost tool comparing to D D 7
telephone
Tradition and customs are one of the B B 1
big barriers,
E-commerce needs to be seen as a new D D 7
method for business
Internet Café AW Software are downloaded from the B - -

manager Internet for free
E-Commerce provide an easy tool for D - -
shopping
E-Commerce helps to maintain the D D 6
culture for Libyan Women
Men don’t have to wait for their D D 6
women while shopping
Lack of payment system create a bad B B -
effect on E-Commerce
334
Appendices
Younger and old people using the D D -

Internet
Customer comes to check there mails D - -
or chatting online,
Few people using E-commerce, only B - -
travellers
People come to cafe net to know about - - -
web design, chatting and games
Lack of payment system drive users to B - -

adopt hacking methods
E-Commerce create a share knowledge D D -
culture between users.
Internet Café AR Website is not beneficial unless B - -

manager provide dynamic services
Traffic in dynamic site is increasing D D 1
Libyans customer were using the - - -
Internet since 1994 and they were
paying 12 L.D per hour
Only 10% of the internet user who use B - -
for a good reason
Engineering OC E-Commerce helps in doing business D - -

manager
Many traditional business are using the D - -
internet
The future more likely to be just e- D, - -
commerce B
10.1.6 Economic Development:
Table 10.4: Economic activities issues in findings
D/B D/B
Job Title Org comments No.
F L
335
Appendices
Undersecretary M O E B2B will work very well as soon as D D 6

E-Commerce is ready.
E-Commerce activities help people to D D 9,
make and save money 10
E-commerce will not have any bad D D 12
effect on the Libyan market.
The competition in the commercial D - -
market is already existed.
Competition between Libyan D, B D, B 7, 9
producers and international importers
or trader is sharp
E-Commerce will create more D, B D 4
competition
E-commerce in developing countries D, B - -
will sharp the competition
Economic ministry do think D - -
competition could help developing
the Libyan economy
E-Commerce can help consumers to D D 8,
buy products cheaper (e.g, removing 10
travel expenses, accommodations, air
tickets, shipping, etc)
E-commerce may effect the B - -
employments, however,
unemployment in Libya was because
not having the right people in the
right place,
Ministry of economy do not think D D 12
using E-Commerce will affect the
economy badly.
The worries of E-commerce in D - -
developing countries will effect the
competition start to disappear
The unemployment in the whole D - -
world is because of the economic
cycle but not e-commerce,
336
Appendices
The percentage of unemployment is D - -

almost the same in all decades, and
that confirm e-commerce is not the
only reason for unemployment but the
International travel has gone too high D D 10
in the whole world because of e-
commerce
If we start providing services in Libya D D 12
using e-commerce we would help
developing the economy and being in
a better place.
Providing services over the web will D D 9
result in expecting huge business.
E-Commerce can help the tourism D D 12
industry in Libya and bring more
business to the whole country.
E-Commerce has to be adopted, D - -
wasting time on adoption will result
in making the situation worse and
needs more money to invest and
catching up
Chairman OPTC It will be easer for the customer to use D - -
the electronic services
E-Commerce will fast up the way of D D 12
doing work in the company.
E-Commerce will reduce the expense D - -
of doing work in a manual way
Many people will shift there activity D D, B 3, 7
into E-commerce
E-payment system will help many D D 10
people to get cheaper products in
short time
Marketing LTT E-commerce benefits every one using D - -
manager it
E-Commerce help in selling, buying D D 10
and doing activities over the internet
337
Appendices
Marketing LIB M-commerce would save the country D - -

manager huge amount of money for building
the infrastructure
There people who has managed to D - -
make millions of dollar by using e-
commerce.
E-commerce will change the way of D, B - -
living, and speed up the way doing
business
E-commerce would make companies D, B D 9
reduces the employment and save
extra money.
E-commerce will effect the B B 1
employment rate and will slow the
wheel of economy development
Internet is important for living D - -
activities
Traditional billing payment is time D D 3
and money consuming
Traditional billing payment results in D D 3
delay the economic circle in the
country E-Commerce is a driver to
develop the economy
E-Commerce will encourage the D D 8
government state companies to catch
up with the new technology
Adopting electronic charge services D D 9
will help the country to reduce
amount of money and time of
bidding.
The reduction of cost will have its D D 9
effect on customer which will benefit
of reduction on using mobile services
charge.
Adopting E-commerce will result in D D 3, 9
providing better services in much less
cost.
338
Appendices
Operation LCB Adopting electronic banking system D - -

manager will enables customers to save time
on doing their banking activities
Internet banking will reduce cost and D, B D 9
employment numbers.
E-commerce makes communication D D 3
and business easer.
For banks E-commerce is more D - -
important that it will help banks to do
there transaction quickly and easily.
Infrastructure delay the adoption of B B 1
Banking system
IT Manager CBL Central Bank of Libya project aims to D D 12
large developments of information
technologies and improving the
The project plan is to formulate a D D 12
strategy that ensures efficiency,
effectiveness and safety for the
developments of a national payment
system to contribute in the
development of financial and other
economic sectors.
The successful implementation of this D D 8
project not only ensure handling the
technical deficiencies, rather it
provides banks with potentials to
provide international quality banking
services.
The training and qualification D - -
programs will contribute in providing
human resources needed to function
and support the application associated
with the programs.
It will reinforce the CBL’s D - -
capabilities to control banking
operations risks and maintain the
financial stability.
339
Appendices
The banking sector will be more D - -

capable and efficient in
intermediation between saving
resources and employment
opportunities.
Chairman BA E-Commerce reduces cost. D D 9
Government still has not adopted E- B B 8
Commerce as a policy
E-Commerce is reducing general D D 9
expenses in private companies
E-Commerce competition is more D, B B 4
stronger, and the verity of chooses are
wider then traditional market
E-Commerce gives the opportunity to D D 4
compare prices for different products
or even for the same products
E-Commerce advantages of trading, B B 12
cutting the expenses, choosing the
right product could result in reducing
traditional importation business.
E-commerce create opportunities to D D 9
expand business
E-Commerce developing the D D 12
economy,
Economic development is different D D 9,
between cost and production, 12
reducing the cost and increasing the
possibility of opening new market
places would increase the production
of the economy.
Libyan Market will not get effected D D 12

badly from E-commerce.
E-commerce would pose some threat B B 3, 6
to traditional commerce in industrial
products.
For agriculture and internal use D D 8
products, these will not get effected
from e-commerce because of the low
price and a good quality that people
get used of.
340
Appendices
Allowing e-commerce will result in D D 9,

reducing the cost of imported 12
products and services that will drive
consumers to save money and
reinvest them in the local economy.
Business CI E-Commerce reduces the cost of D, B D 9

development employment
manager E-Commerce reduce the cost of D D 9
printing and communication,
E-Commerce reduces marketing cost. D D 9
Internet user are mostly teenagers, old B - -
people see technology is complicated
and time consuming
General OCC E-Commerce will benefit companies D D 10

Manager and pose threat to traditional business. B B 2, 3
Right now there is no threat.
Internet Café AW E-Commerce offer a verity of D D 10

manager products
E-Commerce enables customers to D - -
save time in searching for what they
want
Many new E-commerce companies D D 3
will develop, so in order for older
companies to survive they have to
take the same bath along with the
traditional way.
Internet Café AR There is no benefit out of having a B - -
manager website,
Having a website is waste of time and B - -
money
If customers are locals then no need - - -
for website
E-commerce has a huge market and D D 6
has no limit
E-Commerce save time, D D 9
E-Commerce help to generate money, D - -
341
Appendices
E-Commerce gives possibility to do D D 10

new businesses
Engineering OC E-Commerce help to do business D D 4

manager E-Commerce is a marketing tool D D 12
10.1.7 Employment:
Table 10.5: employments issues in findings

D/B D/B
F L
Undersecretary M O E People believes E-Commerce will B B 2
affect employment badly
Employment crises in Libya because D - -
of not having the right person in the
right place rather then E-Commerce
Libyans do not accept any type of job D - -
E-Commerce will force people to D D 3
learn, being trained to be re located in
another job
The unemployment in the whole D - -
world is because of the economic
cycle but not e-commerce
E-commerce is not the only reason for D - -
unemployment but the development
of the economy.
Chairman OPTC E-Commerce will be adopted in B B 2
OPTC services
Cashers will be replaced with B B 2
electronic payment system
Many people will shift there activity B B 5
into E-commerce
Marketing LTT Payment system will be introduced in D - -

manager other shops
All services will be done B B 2
electronically
342
Appendices
Marketing LIB E-Commerce helps in administration D - -

manager work.
E-commerce will reduces the B B 2
employment
People will think that e-commerce B B 1
will affect the employment rate in the
country and will slow the wheel of
economy development
People could be located in other D D 3
position
E-Commerce will create a new way D D 3
of thinking to do new jobs
E-Commerce will help to develop D D 3
workers’ knowledge
Adopting e-commerce and ask people D - -
to leave reduces cost.
Operation LCB Electronic banking system will reduce B B 2
manager employment numbers.
Central bank of Libya is sending D - -
employees for training
Trained and professional people are a B - -
not available in Libya.
This national payment system is B - -
designed to work with Oracel
database system. We have no people
who knows about Oracel
IT Manager CBL National Payments System provide D - -
training programs aimed at qualifying
national professionals
Preparation and qualification of D - -
human resources is needed for the
program to be successful
The training and qualification D D 3
with the programs.
343
Appendices
National payment system will result D D 3, 4

in saving resources and employment
opportunities.
It also will contribute to the D D 1
employment and economic growth.
Chairman BA E-Commerce provide a better services D - -
atmosphere to workers
Being able to provide services
internationally can be employment D - -
benefit
Business CI E-Commerce reduce the cost of B - -

development employments
manager Education and training courses about D - -
e-commerce is needed
General OCC Reducing number of workers B B 2

Manager
Internet Café AW E-Commerce provide an opportunity D D 3
manager for unemployed people
There is lack of expertise to help B - -
working with E-Commerce
Knowledge and experience is needed B - -
for new jobs and new workers
E-commerce will open new spaces D D 3, 4
and provide employment
opportunities.
People can work from home D D 5
Create employment opportunity and D D 3, 5
reduce security braches
Internet Café AR Needs for web designers and B - -
manager programmers
Training and education is needed for B - -
new employments
Engineering OC No comments
manager
344
Appendices
10.1.8 Government :
Table 10.6: government issues in findings

D/B D/B
Job title Org Comments No.
F L
Undersecretary M O E Credit cards will be available across D D 3
Libya by next year according to the
plan of Central Bank of Libya.
If the credit card system been D D 3
distributed in the whole country
then that will build a very good
infrastructure for e-commerce in the
country.
People will not wait for government D, B - -
actions in regulation to start using
the Internet.
Government taken action on D D 4
developing theory or a law for e-
commerce.
There is a decision was made by the D D 4
minister of economic and
commerce to start the process of
establishing committee for E-
Commerce regulation.
The committee has the right to D - -
choose any person that they believe
he could help in doing and
developing the approach.
Libya’s government recognise the D D 1
benefit of E-Commerce and
compare its economy to Tunisia
All that matters is how can we - - -
make a regulation that will satisfy
and keep right for both parities
(Customers, and service providers).
E-commerce infrastructure of B B 13
telecommunication is poor in the
country
High charge of Internet connection B B 13
345
Appendices
Government has responsibility in B B

the lack of training and education
Libya provides 1,000,000 laptop to D D 3
kids
Government encourages having PC D D 3
in each House
Government reduces custom to D D 3
encourage people buying
technological equipments
Government believes competition D - -
will not get effects from E-
Commerce
Electronic services putting the D D 1, 5
country in better place
Providing services in Libya using e- D D 1, 5
commerce could help developing
the economy.
E-government policy is under D D 4
process
E-government adoption idea was D - -
there 1984
Libya is ready for e-government D D 6
Many ministries have websites D D 3
Ministry of Economic provides D D 2
services online such as registering
companies
Ministry of economic claim the D - -
soon the E-commerce adopted, the
better for the country and the
economy
Chairman OPTC Electronic bill payment is D - -
developed by the OPTC
OPTC is responsible for E- B B 13
Commerce infrastructure
E-Commerce will be effective as a D - -
service
Dis-organisation between B B 14
government department created a
chaos on responsibilities
346
Appendices
Government or companies are B B 13

responsible for establishment of E-
Commerce.
OPTC reduced the calls into %70. D D 3
Government thinking to privatise D, B - -
the two Mobile service companies
(Almadar and Libyanna).
OPTC reduced the international D D 3
calls up to %75 .
OPTC reduced the calling charge D D 10, 12
from fixed line to Mobile by %25
The last couple of years there were D D 3
a big achievement in improving
Telecommunication services.
3G service is one of Libyanna D D 10
services. It provide up to 300KBper
second, which could provide video
calling, accessing internet via
mobile and other applications.
Marketing LTT LTT thinking of adopting E- D D 3

manager commerce
Barriers such as Payment systems, B B 4
transactions, and government
departments are lacking the
improvement in the country.
Things start changing from the D D 6
government point of view
LTT provides Domain registration D D 3
free of charge to Local companies
and government agencies
LTT provides Internet connection in D D 12
the middle of the desert
Providing free hosting services to D D 3
companies would help encouraging
the adoption of E-Commerce
Marketing LIB Libyanna working in providing 3G D D 3

manager services
347
Appendices
Libyanna thinking of using Top up D - -

card as money
Libyanna is a state company trying D D 3
to help developing the country
infrastructure,
The government and other private D - -
organisation should pay attention to
conferences, training sessions,
workshops etc.
Government state companies which B B 13
need to wake up and catch up and
move on with the new technology
needs to adopt E-Commerce
The only mobile companies in the B, D B 13
country are completing each other,
and they both have a same aim
which helping in developing the
country infrastructure for mobile
phone services.
Operation LCB Central bank of Libya has signed a D D 2, 15
manager deal with three international
companies to put in Libya a
National payment system
The project designed to provide all D D 3
electronic services
Adopting Internet banking is the D D 3
next step
The central bank of Libya is D - -
sending employees from all Libyan
public banks outside the country for
training
IT Manager CBL Central Bank of Libya works in D D 1, 3
increasing the benefits of the large
developments of information
technologies and improving the
348
Appendices
This system aims to develop D D 7

technologies and techniques for
banking activities The system will
be interlinked and linked with
commercial banks with various
communication means
The successful implementation of D D 1, 7
this project not only ensure
handling the technical deficiencies,
rather it provides banks with
potentials to provide international
quality banking services.
programs will contribute in
providing human resources needed
to function and support the
application associated with these
programs.
Chairman BA E-Commerce has not been B B 6
implemented as a policy for the
government
Government have to pay attention B B 3
to infrastructure
Government has to take E- B B 6
commerce issue very serious if they
want to develop
Adopting E-commerce and D D 1
developing E-government services
will push the country into a higher
position
Electronic illiteracy can be solved B B 12
by the help of government and
people willing to learn.
The government is planning to D D 8, 9,
adopt the E-government services 14
There are website for most D D 3
government ministries
The CBL is working in introducing D D 3
ATMs Machine and providing
people with Credit and Debt cards
to be used
349
Appendices
Business CI The main barrier is the connection B B 3

development to the Internet
manager There should be many workshops, B - -
training courses, conferences and
forum about e-commerce to educate
people the right way of using the e-
commerce.
General OCC No comments

Manager
Internet Café AW Government failure to provide B - -
manager cheap Internet connection drove
people to break the low
Government failure on providing B - -
security for Internet dis-encourage
people to use the Internet
Lack of payment system drove B - -
people to adopt hacking techniques
No law to admit Computer crime B B 4
encourage people to use hacking
software
Internet Café AR There are no schools to provide B - -
manager courses in e-commerce
Failure to provide cheap Internet B - -
connection drove people to break
the law
Project OC Infrastructure, the regulation, and B - -

manager the knowledge in IT in general are
the barriers
The new regulation and IT D D 4
development are the new drivers.
350
Appendices
10.1.9 Infrastructure:
Table 10.7: Infrastructure issues in findings

D/B D/B
F L
Undersecretary M O E Expecting the spread of Credit cards D D 4
in Libya soon
National payment system project is D -
implemented by three large
international companies.
Credit card system build a good D D 4
infrastructure for e-commerce in the
country.
Advancement in Internet technology D D 4
put Tunisia in a better place.
E-commerce infrastructure of B B 1
telecommunication is not there
Land line infrastructure is not good B B 1
The high charge of Internet B B 1
connection is a barrier
Chairman OPTC Organization network does not cover B B 1
all regions
OPTC are working in a plan to D - -
connect all its branches with a data
network.
Companies software are developed in D -
house
OPTC is responsible for fixed line B B -
services
OPTC offers V-Sat services for D D 2, 3
businesses
OPTC provides broadcasting TV to D D 4
the Libyan National Broadcast
corporation, OPTC provides routers
services for the banks.
351
Appendices
OPTC is responsible for the B B 2, 3

infrastructure,
OPTC has reduced telephone charge D D 4
to 70%
OPTC expand its wireless services D D 4
through its subsidiaries companies
OPTC plan to expand fixed line D D 4
services in the next couple of years
In the present OPTC have around B B 1
650,000subscribers, it is around %10
of the pupation.
Restructuring and re-organizing of D D 6
telecom sector is taken place.
All telecommunication companies are B B 2, 3
owned by the government through a
mother company
There are thinking of privatize the D, B D 7
two Mobile service companies
In 2004 OPTC reduced the calling D D 4
charge from fixed line to Mobile by
%25, OPTC through its other
companies are working in expanding
the network,
Reduction on cost is depends on B - 2
covering the installation expenses.
The last couple of years there were a D D 4
big achievement in improving
Telecommunication services.
Libyanna start providing 3G services D D 4
through its mobile network
Marketing LTT LTT is the main internet service B B 2, 3
manager provider in Libya.
LTT provide telephone connection in D D 4
rural place using a VSAT technology
rather then cables using space
satellites.
Central bank of Libya project will D D 4
help developing the E-Commerce
infrastructure in the country
352
Appendices
Prepaid cards for shopping is an D - -

alternative solution to over come the
infrastructure problems,
Liseline charges start from 256Kb for B B 3, 5
9000 L.D, this price been reduces
from 55000L.d.
The charge of 8 Mb for 280,000 L.D B B 3, 5
LTT provide hosting and Domain D D 4
registration
LTT is the only main register for .LY. B B 2, 3
LTT provides internet services using D D 4
DVB-RCS.
LTT provided wi-fi services in rural D D 4
areas
Needs of technological equipments B B 3
and part remain the Internet
connection charge high
High charge is to coupe with the high B B 3
demand on the service
Marketing LIB Libyanna provides 3G services D D 4
manager Libyanna introducing alternative D - -
methods for paying bills
Libyanna planning to connect all D D 4
distributor to the main database using
online application so they can issue
new SIM cards and provide an
efficient services to their customers.
Libyanna is a state company, its one D, B B 2, 3

of many state company that trying to
help developing the country
infrastructure
3G charge to customer still under D D 3
discussion, the cost per 1KB is 2
Dirham, the price is high comparing
with other internet provider
M-commerce would save the country D D 4
money for building the infrastructure
353
Appendices
The two mobile companies in the B B 2, 3,

country are completing each other, 5
and they both have a same aim which
helping in developing the country
infrastructure for mobile phone
services. Libyanna strategy is to
reduce the cost as much as possible to
enable citizen use there services,
Almadar have another strategy which
providing services to Businessmen in
the country
Operation LCB The central bank of Libya project was D D 4
manager done through International companies
to provide banking infrastructure
Internet connection provided by LTT, B B 3
the line is not fast and have problems
The biggest challenge of CBL project B B 1
success is the infrastructure.
If there is no good communication B B 1
infrastructure in place then the system
will not be used.
There are no connection between B B 1
bank’s branches right now.
Satellite connection (2 ways) between B B 2
our branches are not allowed if not
provided by the LTT
The main barriers to e-commerce in B B 1
Libya is the infrastructure and
communications
Commercial bank claim that Libya B B 1, 5
has a poor infrastructure
A project of 40 Million Libyan dinner
cost is not in use because of the
infrastructure.
National payment system is one of the D D 4
drivers of e-commerce in Libya, it
will solve the payment problem in the
country and put a right foundation for
e-commerce to be used.
354
Appendices
IT Manager CBL National payment system is about to D D 4

build the payment and banking
infrastructure
This system provides a fundamental D D 4
automated teller distributor.
It also enables businessmen, their D D 6
clients and companies that provide
these services to accomplish the
payments for transaction charges
electronically using points of sales, in
addition to the execution of all
financial generally accepted
international electronic transactions.
To ensure the success of the system, a D D 4, 7

new technological system was
developed in order to develop the
quality of services and to use
sophisticated electronic techniques for
the banking activity, through
developing an electronic banking
system and the underlying
communication infrastructure.
Chairman BA Payment for Internet around 1000 B B 2, 3,
L.D a month 5
The infrastructure is the main barrier B B 1
Government have to pay attention to B B 1
infrastructure
Government have to adopt E- B B 1
commerce if they want to develop and
catch up quickly,
CBL is working in introducing ATMs D D 4
Machine and providing people with
Credit and Debt cards to be used
Business CI Internet connection type is ADSL B - -
development Connection to the Internet is a barrier
manager in Libya
Connection failure and problem are B B 1
common in busy time
355
Appendices
General OCC The cost of the internet connection is B B 2, 3

Manager high in Libya.
The company pay 1500 L.D a month B B 3, 5
for 1 Mb as well as 150 L.D a month
a cable rental.
Company break the low to have B - -
Internet connection
Satellite connection has less D - -
connection failure and the providers
provides a quick responds.
Internet Café AW Satellites connection is used B - -
manager The café pay 750 L.D a month for B B 1, 5
512 kb Download and 256 k.b. upload
This is a one time cost, it is around B B 5
7000 Libyan Dinner. This cost is for
the dish, and internet connection not
for the equipment and PCs
Internet Café AR Paying 1360L.D for 256KB per B B 2, 5
manager month
ADSL is not good for Internet Café as B B 1, 2,
it has limit of 5G per month 3
Most Internet café’s uses Satellite B - -
connection
Un-sustainability of ADSL B B 1
bandwidth is a problem
People walk away from Internet B B 1
because of the bad connection
Café’s net hardly making profit B B 5
because of the high charge of Internet
charge of LTT
Internet in 1994 was 12 L.D per hour. B - -
Engineering OC The company use ADSL provided by B B 3, 5

manager LTT.
5Gb per month and paying €100 for B B 3
installing and €25 per month.
The infrastructure is one of the main B B 1
barriers of E-Commerce in Libya
356
Appendices
357
Appendices
10.1.10 Knowledge:
Table 10.8: Knowledge issues in findings

D/B D/B
F L
Undersecretary M O E International companies know what B - -
they should do but Libyan do not know
about E-commerce
Libyan mentality do not have the B - -
willing of accepting any type of job
European may take training to change B - -
carrier but Libyan do not.
Education, Knowledge and the ability B - -
of using computers is a barrier for E-
Commerce.
Government provides 1,000,000 D - -
laptops to kids
Government expecting to see a PC in D - -
each house
Government trying to help people to D - -
be educated by reducing customs on
technology equipments
25% to 30% of Libyan young D - -
generation have PCs at home and the
rest uses internet café’s
Chairman OPTC Companies encourage in-house D - -
applications development
People will not accept E-commerce B - -
easily because of the lack opf
knowledge in E-Commerce and
payment system.
Not only technology is needed, willing B - -
of people themselves is also needed.
Encouragement and force of B - -
government to its people to use E-
Commerce is necessary
358
Appendices
Marketing LTT Prepaid cards for shopping will help D - -

manager people to learn more about E-
Commerce
knowledge of local people is a barrier. B - -
People who had the opportunity to D - -
travel abroad, use the internet and
manage to get a credit or debit cards
they know about e-commerce and
internet
People who does not know about E- B - -
Commerce will face difficulty to get
into the new technology
People will not accept easily the B - -
change in their life.
LTT encourage in house system D - -
development.
Provide services on the internet such D - -

as forums could help and be a driver
for e-commerce
Enthusiasm is needed in order for the B - -
adoption to be successful
lack of knowledge about e-commerce B - -
and internet is a barrier
Marketing LIB Libyanna encourage in house system D - -
manager development.
The biggest barrier in the country is B - -
the knowledge.
Libyanna experience lack of B - -
knowledge in their 3G service
adoption
Government and other private B - -
organisations are responsible for
knowledge
In order for people to know more B - -
about e-commerce and its benefits,
training and conferences is needed
People needs to know about E- B - -
Commerce effect
359
Appendices
E-Commerce will create a new way of B - -

thinking to do new job and develop
there knowledge
Exploring technology and understand D - -
its advantages and disadvantages as
well as learning form other countries
and companies mistakes is better.
Operation LCB Central bank of Libya provides D - -
manager training and education.
The central bank of Libya is sending D - -
employees from all Libyan public
banks outside the country for training
from time to time to learn English and
get some training in banking electronic
systems.
Other workshops and training courses D - -

are taking place inside the country.
Trained and professional people are a B - -
barrier.
English language is a barrier. B - -
IT Manager CBL National Payment System provide D - -
knowledge about the using of new
technology
Banks are being prepared, to work D - -
with National Payments System,
though intensified training programs
aimed at qualifying national
professionals capable to mange and
function all parts of the project.
The programs considered the D - -

preparation and qualification of human
resources to function, maintain and
reinforce these systems.
with these programs.
Chairman BA BA provide training for its staff D - -
360
Appendices
Staff benefit from international D - -

expertise
BA encourage in house system D - -
development
Electronic illiteracy is the main barrier B - -
Knowledge barrier can be dealt with if B - -
government and people are willing to
solve it
Business CI One of the barriers is e-commerce B - -
development knowledge
manager Customers do not know much about e- B - -
commerce and use of computer.
The higher population of internet user D, - -
in the country are teenagers B
Old people do not bother to learn new B - -
technology
Old people prefer face to face B - -
communication
General OCC No comments
Manager
Internet Café AW Finding expertise has delay adoption B - -
manager of new business
Libya needs Knowledge and expert B - -
about security and using internet in
safe ways.
Companies can help in provide B - -
security and teaching people how to
use internet safely
E-Commerce can be a tool for gaining D - -
knowledge
Lack of payment drove people to learn B - -
about hacking techniques online
E-Commerce encourage users to share D - -
knowledge
Internet Café AR Lack of knowledge of E-commerce is B - -
manager a barrier for E-Commerce
People do not know what E-commerce B - -
means.
361
Appendices
There are no schools or colleges to B - -

teach E-commerce
Internet cafes provides training courses D - -
to Oil companies and Government
departments
Few people uses the internet for a B - -
reason
Engineering OC The knowledge in IT in general is a B - -
manager barrier
10.1.11 Legislation:
Table 10.9: Legislations issues

D/B D/B
F L
Undersecretary M O E Lack of payment legislations B B 1
People will not wait for legislations D - -
People will not wait for government D - -
actions
Absence of regulation may effect B B 1,4
badly Libyan users
E-commerce law is about to develop. D D 1
Ministry of Economic issued a D D 1
decision to start working in E-
Commerce law
Help of expertise is permitted D - -
Regulation need to not conflict with D - -
other issues.
There is a need for regulation. D D 1
Absence of regulation stopping other B - -
development
Chairman OPTC Absence of legislation delays other B - -
development
legal issues are barriers in Libya B B 4
362
Appendices
Electronic payment is not permitted B B 1

yet by law
Electronic signature still not permitted B B 1
by law
No regulation and legislation in Libya B B 1
Security is a barrier for e-commerce B B 11
National plan to developing regulation B B 1
is needed
Marketing LTT Absence of regulations delays E- B B 4
manager Commerce development
There is a need for Electronic payment B B 1
regulations
Hackers and security are barriers B B 6,
11,
12,
No education on security issues B - -
Marketing LIB Islam may be a barrier for E- B - -
manager Commerce regulations
Transactions over internet is not B - -
allowed in Islam
Be ready to face security problem D - -
rather then wake away
Learn from other countries and D - -
companies experience
Operation LCB Regulation for E-Payment system is D D 1

manager considered
E-Commerce has not used to know - - -
barriers
Bank cards still not accepted in Libya B B 1
Regulation is a barrier ion Libya B B 1
IT Manager CBL Regulation of Electronic payment is D D 1
considered in the national payment
system
Regulations for Credit and debit cards D D 1
is considered
Regulation for Point of sale is D D 1
considered
363
Appendices
Regulations for international payment D D 1

is considered
Coding and protection software D D 11
between banks are located
Updating laws and regulations to D D 1
allow for the electronic transactions.
Chairman BA Security in Libya is a barrier B B 11
Lack of security scared people to use B B 8
the Internet
Absence of regulation delays the B B 1
development of E-Commerce
Absence of regulation drive people to B B -
use other county for their business
Regulation will help the economic D - -
development
Business CI International regulation is existed in D - -
development Libya
manager Regulations are barriers for E- B B 1
Commerce
Education is needed for Use of E- B - -
Commerce and its rights
General Oil and People break the law to connect to D B 4
Manager Constru Internet
ction Better services drive people to break B B 4
compan the law
y
Hackers are barrier. B B 12
People afraid of using e-commerce B B 8
because of hackers
Internet Café AW Pricy of software B B 3,
manager 7
Cracked software available for free B B 3
Users help each other to share cracked B B 3
software
Security software are available for B B 12
free
People break the law for Internet D - -
connection
Security is a big barrier. B B 12,
11
364
Appendices
Internet needs good security. B B 12

Internet not secure to make payment B B 12
International companies needed for D - -
security
Education is needed D - -
Copyrights, Security, and hacked B - -
software is another barrier.
People feel no secure of the internet. B B 8
Lack payment system drove people to B - -
adopt hacking techniques
No law to admit Computer crime and B B 1,
no company who are working in this 12
field,
No education and knowledge about B - -
computer crime.
Internet Café AR Breaking the law for Internet D B -
manager connection
Un clarity on Internet connection B - -
contracts
Engineering OC Regulation is a barrier for E- B B 1
manager Commerce
New regulation and IT development D D 1
will be the main drivers
10.1.12 Payment:
Table 10.10: Payment Issues in Findings

D/B D/B
F L
Undersecretary M O E Buying is limited to Credit and debit B B 5
card holders
Buying is limited to overseas account B - -
holders
Some purchases are done on line by D - -
cards holders.
expecting the spread of Credit cards D D 4
in Libya
365
Appendices
If the credit card system been D D 4

distributed in Libya then that will
build a very good infrastructure for e-
commerce in the country.
People will start trading if they have a D - -
possibility they won’t wait for law to
be issued,
Chairman OPTC In the automation plan, we have part D D 3
of plan called electronic bill payment
This EBP will be with the help of
banks
we are trying to work with other D D 2, 3
banks to develop and introduce this
payment system.
To enable online payment through the D D 1, 3
web for customers once the cards are
ready to use
Payment system will reduce the D - -
expense of doing things in a manual
Payment system will reduce the cost D - -
of security on cash
Payment system will reduce D - -
employment
We accept cash and checks only. B B 17
Bank system need to update there B - -
system,
Banks need to enable E-Commerce B - -
use
Banks do not have the legislation to B - -
authorise the acceptance of E-
payment
E-Signature is not accepted for B - -
Libya’s new E- payment
Banks are taking steps to put Credit D D 10, 4
Card and ATM Machine in place.
There are also a culture barrier with B B 13
payment system
people used on having cash than cards B B 17
or E-payment
366
Appendices
Cash is more in use then personal B B 17

cheques in Libya.
E-Commerce and payment adoption B - -
will not be easy
People need to be forced to use E- B B 13
Payment system
Once the system is used people can D D 1
realise the benefit
E-Payment is easy to use. D - -
Marketing LTT payment and transaction system is D D 5
manager important for E-Commerce adoption
The government realised the D D 4
importance of payment system and
working in NPS.
NPS allow immediate transactions D D 2
between banks
NPS allow the use of ATMs machines D D 10
Alternative payment project taken D - -
place to cover the delay of NPS
adoption
Al-oma bank and Al-Mahari shopping D - -
centre created alternative payment
cards
The idea of the project is enabling D - -
shopper to use prepaid cards for
shopping,
one of our new services is a prepaid D - -
cards to be used over the Internet
Once NPS is ready to use, we will D D 1
provide online services
Payment systems and transactions are B D 5
barriers of E-Commerce,
The lack of payment system B B 4
controlled our development
E-Commerce is known by people B - -
who had the opportunity to travel
abroad
Shopping online in Libya just for B - -
Credit and debit cards holders
367
Appendices
People will face problem for adopting B B 14

e-commerce and payment system
LTT accept checks and Cash. B B 17
Not having a payment method is a B B 5
barrier.
Banks could play an important role in D - -
encouraging people
We are benefiting from E-Commerce D - -
by pushing banks to adopt the NPS
Marketing LIB Thinking of using Top up card as D - -

manager money
customer can pay there bills over the D - -
mobile,
people don’t have enough time to deal D D 1
with paying bills
Libyanna will take the money from D - -
your balance and transfer it to the
electricity company bank account.
We accept Cash only, B B 17
people prefer to deal with cash, B B 17
we probably need some time to adopt B B 14
any other way of payment.
E-Payment reduce the time of getting D D 2
job done
E-Payment reduce the number of D - -
employment by organisation
E-Payment save time D D 2
E-Payment will effect positively the D D 4
E-commerce will drive people to be D - -
more organised with there jobs and
payments.
Operation LCB National payment system signed D B 15
manager between central bank of Libya and
three international companies
NPS would help Libyan banks to do D D 2
transaction and receive payments
electronically.
368
Appendices
Most of international transfer are B - -

done through the Arab Foreign bank.
The project designed to provide all D D 2
electronic services
By the end of the project cards will be D D 5
introduces to all customers.
The next step is to start thinking of D D 2
adopting electronic banking system
E-Banking will enables customers to D D 1
do some activities.
The biggest challenge of this project B - -
success is the infrastructure.
We don’t have good connection B - -
between our branches right now.
Regulation and limitation of choosing B - -
ISP is a barrier.
Sending employees for overseas D - -
training in NSP and English language
is done by central bank of Libya
Other workshops and training courses D - -
are taking place inside the country.
NPS is more important for banks to D D 2
do there transaction quickly and
easily.
Traditional payment system is time B B 17
consuming (40 days for cheque
liquidation)
As Bank we accept most of the type B B 17
payment such as Cash, checks,
approved check, Money transfer into
account, etc.
The only thing we don’t accept and B - -
not dealt with is the cards.
NPS not in use because of the B - -
infrastructure.
Lack of expertise in Computing and B - -
electronic system
369
Appendices
Overseas training is necessary to deal - - -

with the system and repair it when its
needed.
NPS is one of the drivers of e- D D 5
commerce in Libya,
NPS will solve the payment problem D - -
in the country
NPS will put the right foundation for D 5 5
e-commerce
IT Manager CBL NPS was preceded by approving a D - -
plan, set by a committee of experts in
the banking activities.
NPS will contribute to the D D 4
development of financial and other
economic sectors in Libya.
Real-Time Gross Settlement is to D D 4
settles the accounts of banks and
public institutions with the CBL at
every working day-end.
Automated Clearing House is for D D 2
settlement of all banks transactions
Automated Checks Processing is for D D 2
clearing of checks
ATM provides a fundamental D D 9
automated teller distributor
ATM provide service for national and D D 9
International networks
NPS enable e-payment for Business, D D 1
clients and companies to accept
national and International payment
Core Banking System aims to D D 4
develop technologies for National
banks by adopting NPS to compete
with International banks.
NPS is implemented by NPS and D - -
some other commercial banks
370
Appendices
NPS interlinked and linked with D - -

commercial banks using optic fibbers,
centimetre waves, satellites, wireless
net, digital circuits and other
communication means.
Security issue were considered with D D 16
NPS
NPS provide electronic banking D D 4
system and the underlying
communication infrastructure.
NPS helps in updating the banking D D 2
activities in accordance to these
systems.
NPS force the CBL to Update laws D - -
and regulations with which banking
institutions are working to reflect the
effects of technological
developments, and to allow for the
electronic transactions.
NPS help to monitor the banking D D 8

sensitive operations.
NPS helps to create the required data D - -
centres to tele-control risks.
NPS provide the potentials for local D D 4
banks to provide international quality
banking services.
NPS provides banks with control over D D 2,4
their accounts.
CBL focuses in training and D - -
qualification programs to provide the
needed human resources for the NPS
Chairman BA We are working on accepting credit D D 1

and dept cards via our website.
CBL is introducing ATMs Machine D D 10
and providing people with Credit and
Debt cards to be used,
Payment system is a driver D D 5
371
Appendices
Business CI we only allowed to accept money B - -

development transfer
manager Restriction of money transfer in and B - -
out the country
General OCC we accept approved checks and bank B B 17
Manager transfers
Internet Café AW No alternative method for electronic B B 17

manager payment
Security for payment is a barrier B B 16
We accept cash only B B 17
Banks and Money Transfer is the B B 4
main barriers,
Buying and selling on the Internet is B B 4
limited because of E-Payment
transferring money is very difficult B - -
and expensive,
there is no credit or debit cards to be B B 17
used
There is not even a third party to help B - -
buying from online ,
Lack of payment create the popularity B - -
of hacking and cracking cards in
Libya
Internet Café AR Accept cash only B B 17
manager
372
Appendices
10.1.13 Security
Table 10.11: Security Issues in Findings
D/B D/B
F L
Undersecretary M O E Adopting e-commerce law and start D D -

the e-commerce regulation process
How can a regulation satisfy and keep B - -
right for both parities (Customers, and
service providers)
Chairman OPTC E-Commerce provide more security D - -
to secure the cash
Security another barrier for e- B B -
commerce as a technical issue
Marketing LTT Hackers and security are barriers for B B -
manager E-Commerce
Education is needed to show the B - -
power of technology.
There are many Hardware and B B -
software barriers specially for
security issues
Marketing LIB E-Commerce benefit is that customer D - -
manager will not have to carry cash
By using E-Commerce people would
feel more secure.
New technology needs exploration D - -
rather then fear
Learning form other mistakes can be D - -
a solution
Operation LCB One of the disadvantages is the JUNK B B -

manager information that is on the net,
IT Manager CBL CBL centres will ensure online D D -

functioning of national banks all the
time and in all circumstances.
373
Appendices
The appropriate networking of the D D -

main data centre, auxiliary and
emergency centres will allow for their
automatic alteration when necessary
to avoid any interruption whatsoever
the reasons.
Chairman BA The main disadvantage of e- B B -
commerce in Libya is the security,
They should be security companies in B - -
Libya to secure systems and educate
people regards security.
Security scare people to use the B B -
Internet
Business CI There should be many workshops, B - -
development training courses, conferences and
manager forum about e-commerce to educate
people the right way of using the e-
commerce
General OCC Hackers are barrier to E-Commerce B B -
Manager Hackers pose a huge threat to e- B B -
commerce user.
Many people afraid of using e- B B -
commerce in order not to be victim in
one of hackers problems.
Internet Café AW Illegal downloaded software and B B -
manager cracked software are in favored use in
Libya
security software such as Kasper, B B -
Kasper Sky antivirus are also cracked
Internet needs good security B B -
transaction are not secure in the B B -
Internet
Security Software and Hardware is B - -
needed in Libya
Knowledge and experience sharing is B - -
needed in Libya
374
Appendices
special companies Is needed in the B B -

market to provide security and safe
use services and to be responsible for
fighting these crime as well as
teaching people how to use internet
safely
Copyrights, Security, and hacked B B -
software is another barrier.
As long as hackers exist in the market B - -
do not expect to see any trade online.
People feel no secure of the internet.
Lack of payment was a reason of B B -
driving people to adopt hacking
techniques
Hackers and Crackers techniques D - -
needs a long time to understand and
be able to use,
Users share knowledge and B B -
information about hacking and
cracking
No law to admit Computer crime and B B -
no company who are working in this
field has created a good market for
hackers and crackers
Internet Café AR No comments
manager
Engineering OC No comments
manager
10.1.14 Traditional Business:
Table 10.12: Traditional Business Issues

D/B D/B
F L
Undersecretary M O E Libyan producers are complaining B B 2
that many international products have
interred the country through Libyan
importers or trader
375
Appendices
Travel agents will disappear because B B 2, 4,

of E-Commerce 3
E-Commerce business provide B - -
cheaper staff and may be better
quality
If the product and service in local B B 2, 3
supplier will not get better, then they
face a huge competition,
International travel has gone too high B - -
in the whole world because of e-
commerce
If we start providing services in Libya D - -
using e-commerce we would help
developing our economy and being in
a better place.
E-Commerce can provide a better D - -
marketing tool
Chairman OPTC Electronic services will fast up the D - -

way of doing work in the company
and reduce the expense of doing
things in a manual way
Electronic entry will show in the D - -
system right away the moment that
been entered. Rather then the manual
way that we are doing now.
I think e-commerce is a new way of D - -
doing business.
With the popularity of internet B B 2
website and increasing numbers of
internet users many people will shift
there activity into e-commerce
There is a big threat to traditional B B 4
business.
Marketing LTT LTT provide no service over the D - -

manager internet, most of services are in
traditional way
Hackers and security can be in the D - -
benefit of traditional business
376
Appendices
High Internet charge was in the D - -

benefit of Traditional businesses
Marketing LIB Thinking of using Top up card as D - -
manager money
people looking for solutions to save D - -
time.
Electronic payment is safer D - -
E-commerce will change the way of D - -
living , and will speed up the way
doing business,
traditional way of business is a time B - -
consuming,
E-Commerce actually a driver to D B 3, 4
develop the economy specially for
government state companies which
need to wake up and catch up to move
on with the new technology that is
developing too rapidly.
Operation LCB Central bank of Libya helping bank to D D 3
manager transfer from traditional to electronic
services providers
Next step is to start Internet banking D D 3, 4
E-commerce For banks is even more D D 3, 4
important that it will help banks to do
there transaction quickly and easily.
Traditional commerce will get effect B B 2, 4
by e-commerce and probably will
disappear from business activities as
e-business will take over every thing
IT Manager CBL Automated Teller Machines D D 3
(ATM)/Points of Sales (POS) enables
businessmen, their clients and
companies that provide these services
to accomplish the payments for
transaction charges electronically
using points of sales which will effect
the traditional business
Chairman BA Electronic commerce works along the D D 3
side with traditional methods
For products E-commerce will create B B 2
a threat to traditional business
377
Appendices
Traditional importer will face B B 2

difficulties with E-Commerce
because of its low prices
If E-Commerce campaign with D D 3, 5
traditional commerce, companies will
have a chance to expand business
Libyan Market is consuming market, D - -
so it doesn’t really get affected too
much from e-commerce.
E-Commerce pose a threat to B B 2
products and material importers
For agriculture and internal use D - -
products, these will not get effected
from e-commerce because of the low
price and a good quality that people
get used of.
Business CI Traditional financial trading D D 2
development companies have to adopt E-
manager Commerce
E-Commerce help business activities D - -
There is no threat to traditional D D 1
business.
The difficulty of correcting a mistake D D 1
electronically comparing to correcting
mistake manually is much easer and
strait forward.
The higher population of internet user B, D - -
in the country are teenagers
Old people do not have the time to D - -
learn as well as facing difficulty of
catching ups.
Most of old age people prefer using a D - -
traditional way of doing business.
General OCC Most of work done over the internet D D 3

Manager contact with supplier and sub D D 3
contractor by email.
Email is lower cost comparing to a D D 3
telephone line.
378
Appendices
If every one start using e-commerce B B 4

then we will see a big benefit which
will effect the business between
companies and pose threat to
traditional business. Right now there
is no threat.
.
Internet Café AW E-Commerce is more convince then B - -
manager traditional commerce
Simple ideas online can be money D - -
generators
Security can be a threat of using E- D - -
Commerce
Payment system been a barrier to E- D - -
Commerce and a benefit for
traditional business
Copyrights, Security, and hacked D - -
software is another barrier to E-
Commerce. People feel no secure of
the internet.
E-Commerce might be a challenge to D D 3
traditional business, But in the same
time it will drive trader to adopt this
technology to catch up with the rest.
E-commerce will bring many new D D 3
companies, so in order for older
companies to survive they have to
take the same bath along with the
traditional way.
The two ways will be there. It not a D D 5
real threat,
Few people using e-commerce D D 1
Internet Café AR E-Commerce is a new way of making D - -
manager money
E-Commerce is smellier to the D D 5
traditional ways of business with less
hustle and saving time and money.
There is no benefit of having a D - -
website
379
Appendices
The charge of hosting, design, and D - -

submitting to search engine is
discouraging businesses to go online
If customers are local then you don’t D - -
need a website
E-Commerce is much easy way of B B 1
doing business then a traditional way
of doing that business.
E-Commerce is more powerful then a B - -
traditional commerce.
E-Commerce help you to do new B - -
businesses that they might had never
come across your mind.
Engineering OC Website is there to attract customers, D D 5
manager the rest can be done in traditional way
E-Commerce and traditional business D D 5
are pearl, specially in a market like
Libya, Many traditional business are
using the internet, it works perfect in
both sides.
The future more likely to be just e- B B 4
commerce.
380
Appendices
Appendices 10.2: Interview question
INTERVIEW
Date: Day: Time:
1. Personal Information
Full name:
Position:
Sex:
Telephone No:
Fax Number:
E-mail:
Web site:
381
Appendices
2. Company Details
Company Name
Industry
Operational location
Annual Turnover
Number of employees
Trading partner Customers:
Suppliers:
Information technology infrastructure
Network
Hardware
Applications
Contact point
Address
Phone no
Fax
E-mail
Website
382
Appendices
3. Interview Questions
1
Do you know the term e-commerce?
2
Does your company have a strategy for electronic commerce?
3
Which communication do you use?
4
Does your business engaged in electronic commerce ?
5 If you implementing e-commerce, what is the advantages / reasons of

implementing e-commerce? What is the main befit to your business?
6 If you are not implementing e-commerce, what is the disadvantages/reason
of not implementing? Why you are not involved?
7 If you don’t have a clear strategy for e-commerce at present, is it likely to
become important in 2-3 years?
8
How many products and services does your business offer?
9
How do you deliver your products and services to consumer/client
10
What type of payment do you accept
11 Do you update your web if you have one, or does the third party doing for
you?
12
What is the barriers of e-commerce in Libya
13
What is the drivers of e-commerce in Libya
14
What is the threat to the traditional commerce
15
What are the pioneers to e-commerce in Libya
16
Any other comments
383
Appendices
384
Appendices
10.3 Appendices: questionnaires’ answers
1 General information
1.1 Position
Manager 1
Decision makers 0
Students 69
Employees 48
Self employees 9
Other 23
1.2 Number of employees
0-20 23
21-100 27
101-200 13
201-500 11
501-1000 9
1000+ 7
Don’t know 60
2 E-commerce
2.1 Does your company have an e-commerce strategy?
Yes 54
No 42
Don't know 54
2.2 Does your company use any of the following communication technology?
385
Appendices
Automatic Data Collection 42

Telephone over the internet 98
Document image processing 59
E-Catalogue 41
EDI 6
EDI to Fax 5
EDI to Paper 0
Electronic form 36
Electronic fund transfer 25
Electronic mail 116
Fax 32
Telex 23
Trade data interchange 9
Video Conferencing 18
Voice mail 7
Others
2.3 The statement blow show the engagement with e-commerce
never heard of term before 26

Have heard but not use in any way 31
I have heard and used in 27
Have visited seminars 23
have prepared strategy for e-commerce 12
planning for using e-commerce 13
Undertaking e-commerce development 9
we are extensive user of e-commerce 5
we are extensive user of other technology 4
2.4 Advantage /reason why

Strongly Strongly No
organisation are agree Not sure disagree N/A
agree disagree Answer
implementing e-commerce
internal e-commerce speeds
communications 2 51 32 31 13 12 9
make organisation more 2 25 37 46 13 19 8
386
Appendices
efficient
email is useful for
communication
3 52 19 30 13 18 15
e-commerce provide efficient
5 49 13 31 13 11 28
increase real storage way
2 52 24 25 17 19 11
Lower cost
6 43 17 37 18 13 16
retained/gained customers
3 47 19 37 7 5 32
better relationship with
partners
4 42 17 35 17 19 16
less paper handling
4 45 1 43 3 7 47
better control over
information
3 53 20 47 17 7 3
reduction in admin task
3 35 25 53 13 6 15
2.5 Disadvantages/ reason Strongly Strongly No

agree Not sure disagree N/A
not adopting agree disagree Answer
We don't fully understand it 37 19 31 30 17 14 2
we don't know we to go to
learn about it 13 32 35 25 24 21 0
we cannot use it 25 18 36 13 31 23 4
it does not reduce costs 2 12 61 11 36 21 7
we don't have time 12 9 59 19 12 34 5
we can not afford the cost 19 7 48 19 30 23 4
we are fearful of security 13 31 36 24 18 21 7
we have the willing but we
don't have support 7 31 43 25 4 37 3
is a lack of government and
industry -led visibility 13 30 54 18 8 22 5
There are lack of legal issues 2 19 47 30 12 34 6
it leads to more mundane 1
jobs and job losses 5 30 44 30 7 33
2.6 Are there any other reason?
No internet 66
387
Appendices
2.7 if you don't have an e-commerce strategy now, will you have a strategy within 2-3 years
Yes 72
No 7
don't know 71
3 The internet
3.1 Who is you internet provider
LTT 36
GPTS 12
Satellite 24
Others 78
3.2 What is the type of connection?
Modem 18
Lise-line 12
Broadband 0
Wireless 36
Other 24
28KB 0
56KB 11
64KB 7
128KB 7
256 5
512 6
Don’t know 42
3.3 What tool do you use when accessing the internet?
Archie 0
Email 90
388
Appendices
FTP 18
Mailing list 30
Newsgroup 24
Remote login 12
Internet browser 42
Chat 66
www via email 30
Other 0
3.4 from the used tools which is the most frequently used
Archie 0
Email 48
FTP 6
Mailing list 0
Newsgroup 0
Remote login 0
Internet browser 24
Chat 24
www via email 0
Other 0
3.5 Do you have a web site?
Yes 48
No 42
No answer 60
3.6 If the answer yes do you update in-house or by third party
in-house 24
third party 0
Don’t know 24
389
Appendices
3.7 Do you have internet security such as Firewall?
Yes 42
No 24
Don’t know 12
3.8 if the answer were yes please specify:
Firewall
Kasper
3.9 please specify the

Very Not Not Not very No
reason of using internet Important
important sure important important answer
cafes
for self improvement 42 12 7 7 12 70
For internal calls 45 13 2 0 19 71
for External call 33 17 3 8 18 71
For web site visiting 51 7 9 0 13 70
for chatting 72 25 8 18 6 21
File transfer 52 20 25 13 0 40
trade 40 14 13 17 13 53
upload files 25 17 17 7 12 72
purchases 13 18 9 24 18 68
sell and marketing 24 2 6 15 30 73
to get information 67 42 5 23 0 13
others 23 14 7 0 0 106
3.9 From the listed before what was the most used reason?
for self improvement 0

For internal calls 0
for External call 12
For web site visiting 6
for chatting 36
File transfer 6
Trade 0
390
Appendices
upload files 0
Purchases 0
sell and marketing 0
to get information 30
Others 6
3.10 What do you think the most internet features?
Information and easy to contact

Cost
3.11 What are the internet disadvantages
Security, 65
Culture, 20
speed 34
No answer 31
3.12 what are the barriers in Libya
Infrastructure, , 41
Government involvement 32
Young people 10
misunderstanding of the real meaning 14
No answer 53
3.13 will you buy from the internet if you have a chance?
Yes 67
No 38
Don’t know 45
No Answer 0
3.14 what is the best solution for the internet to successes in Libya?
Reduce cost 29
391
Appendices
Knowledge and educations 13

Family support 13
Improvement 13
Cost reduction 18
Cards 25
No answer 39
392
Appendices
10.4 Questionnaire questions
393
Appendices
394
Appendices
10.4 Questionnaire questions
395
Appendices
Section 1: company & Personal details: Other, please specify:
1.1 : Over view

2.3: Are any of the previously stated technologies
Name: integrated?
Sex: Position: EDI & E-mail E-forms & Email
Business sector: EDI & FEDI CTI & Fax

Number of employees: Other integration’s:
0 -20 21-100 101-200
201-500 501-1000 1000 +
Telephone:
Fax: 2.4: the statements listed below attempt to characterise

E-mail: your company’s e-commerce engagement.
Had not heard of term until now
WWW:
Have heard of term, do not use in any way
Have heard of term but only use, for
Section 2: Electronic commerce example:………………
2.1: Does your company have a strategy for electronic Have visited seminar(s)
commerce? Yes No
Have prepared strategy for e-commerce-type activities
2.2: Does your company use any of the following
Planning of using e-commerce
communications technologies?
Undertaking e-commerce development
Automatic Data Collection /Transfer
We are extensive user of e-commerce
Computer Telephone Integration (CTI
We are extensive user of other technology
Document Image Processing
Explanations:
Electronic Catalogues
Electronic Data Interchange (EDI)
EDI to FAX
EDI to paper
Electronic Form
2.5: the statements below outline advantages and/or
Electronic Fund Transfer (EFT) reasons why organisations are implementing e-commerce
solution. Please use the following scale
Electronic Mail (E-Mail)
1= Strongly agree 2= agree
Facsimile (Fax) Neither agree
3= 4= disagree
nor disagree
Financial EDI
5= Strongly disagree
Telex
Trade Data Interchange

The main benefits of e-commerce to our organisation are:
Video Conferencing
1 2 3 4 5
Voice mail Internal e-commerce speeds
communications flows within
396
Appendices
Make organisation more efficient

E-mail is useful for communications
with trading partners
E-commerce provides efficiencies 2.8: if your company does not have a clear strategy for e-
commerce at present, is it likely to become increasingly
Increase in reliable/accessible ways
important in the next 2-3 years? Please provide details
of storing
information
Lower costs e.g. data entry,
Retained/gained customers
Better relationship with trading
partners Section 3: The Internet
Less paper handling This section deals with the internet. If your company is not
Better control over information connected, please go to Question 3.13
availability and reliability 3.1: which services provider use to connect to the internet?
Reduction in administrative tasks
Libyan Telecom and Technology (LTT)
The general post and telecommunication company
2.6: the statement listed below outline disadvantages and/or (GPTC)
reason why organisation are not implementing e-commerce
Internet Via satellites
solution
We are not involved in e-commerce because Other, please specify
1 2 3 4 5
We don’t fully understand it
We don’t know where to go to learn3.2: what connection type and speed
about it
We cannot obtain easy-to-use, off- Leased Line 14.4Kbps
the shelf type packages
We believe the supposed benefits do Modem 28.8Kbps
not outweigh the cost
Value add network 56kbps
We don’t have the time to learn
about it Virtual privet network 64Kbps
We cannot afford the high costs
Wireless connection 128Kbps
We are fearful of security,
intrusions, viruses and bugs
We do not have a sufficient mass of Broadband connection 256Kbps
trading partners who are involved
Although we would like to be, we Other: please specify Other: please specify
don’t have enough high-level
support within our organisation
There is a lack of government and
industry-led visibility
There lacks a legal infrastructure3.3;
to what tools does your company use when accessing the
support it internet?
It leads to more mundane jobs and Archie Veronica
job losses
E-mail WAIS
2.7: are there any other reasons why your organisation File Transfer (FTP) WHOIS
has/is not implementing any form of e-commence?
Gopher WWW browser
Mailing list Please state which:
397
Appendices
Newsgroups
Remote login, telnet WWW via e-mail
Other , please specify: Electronic trading opportunities
File transfer (including Documents)

Gaining/maintaining competitive
advantages
3.4: of the tools listed in Q3.3 which are the most
frequently used? Globalisation
Graphics/Technical data transfer
Purchasing
Sales & Marketing

3.5 of the tools listed in Q 3.3 do you perform any of your
Information retrieval and utilisation
own administrative network services e.g. DNS, mail, news
feeds or this provided by a third party? Information provision
Information exchange
Other, please specify;
3.6: Does your company have a Web server/Site

Yes No 3.9: Approximately how many employees in your
If yes, please indicate if the server/site managed by yourorganisation have access to the internet?
company or by a third party provider?
3.10: Approximately how many of these employees use the
internet on regular basis (at least once a week)
3.7: Does your company operate Internet security features

such as Firewall 3.11: What do the majority of employees use the internet
Yes No for e.g. email, www browsing, www searching, ftp, news?
If yes please provide brief details:
3.12: if your company utilise the internet, what are the

major benefits gained?
3.8: Does your company utilise the internet for any of the
following business activities? Please mark 1-5 where 1= very
important and 5=less important
3.13: Does your company have, or will you soon be
Collaboration & Development developing an internet strategy?
Communication (internal) Yes No
Communication (external) If Yes, please provide details.
Corporate logistics
Creating a corporate presence
(WWW)
Creating a corporate presence
(ftp/gopher site) If No, is it likely to be important in the next 2-3 years?
Creating a corporate presence Please provide details
(other) please specify
398
Appendices
Assessment & Planning
Design service
Training
Section 4: E-commerce and Future Implementation services

4.1: of the item listed below, please indicate any
Management service (outsourcing)
positive/negative opinion as to the potential success of each
item within your company where 4.2: What is your company’s future perspective of
electronic commerce over the internet?
1= Very positive 2= Positive
Very
Unsure/don’t 5=
3= 4= negative negative
know
1 2 3 4 5
Accessibility 4.3: Further information

WWW browser If you have any further information you would like to add
please do so below
E-mail
Other tools e.g. ftp and gopher
Packaged solution
Integrated applications
Resources
Search tools
Catalogues
Information Brokerage
Virtual shopping malls
Virtual trading malls Section 5:Contact details

If you would like to receive any future information about
Middleware
E-commerce and developing countries please contact
Access control Name: Abdalla Hamed
Authentication UK Address: 20 Keppoch street
Directories Cardiff, UK
Electronic payments CF24 3JW
Mechanisms Office Phone No: +44 (0) 29 2041 6332
Hardware/Network Mobile No: +44 (0) 78 4167 5951
Servers
Libya Address Bader Al-Hasse & Co
Modems/routers
102 Al-Madina Tower
Dial-up
Ali KAlifa Al-Zaidi street
ISDN
Triploi- Libya
ATM/Frame relay
P.O.BOX: AL-BAIDA 270
Consultancy /Training
399
Appendices
Office phone No: +218 21444 5319 / 318

Mobile No: +218 91209 3316
e-mail ahamed@uwic.ac.uk
research@alhasse.com
Website www.alhasse.com/e-commerce.html
Thank you for participating
400
Appendices
10.5 Questionnaire question linked to e-commerce
issues
Table 10.13 questionnaire questions and e-commerce issues
traditional business
economic activities
infrastructure
employment
government
competition
legislations
knowledge
payment
security
culture
cost
1 General information
Automatic Data Collection ● ● ● ● ● ● ● ● ●

Telephone over the internet ● ● ● ● ● ● ● ● ●
Document image processing ● ● ● ● ● ● ● ● ●
E-Catalogue ● ● ● ● ● ● ● ● ●
EDI ● ● ● ● ● ● ● ● ●
EDI to Fax ● ● ● ● ● ● ● ● ●
EDI to Paper ● ● ● ● ● ● ● ● ●
Electronic form ● ● ● ● ● ● ● ● ●
Electronic fund transfer ● ● ● ● ● ● ● ● ●
Electronic mail ● ● ● ● ● ● ● ● ●
Fax ● ● ● ● ● ● ● ● ●
Telex ● ● ● ● ● ● ● ● ●
Trade data interchange ● ● ● ● ● ● ● ● ●
Video Conferencing ● ● ● ● ● ● ● ● ●
Voice mail ● ● ● ● ● ● ● ● ●
Others
2.3 The statement blow show the
engagement with e-commerce
never heard of term before ● ● ● ● ● ●
Have heard but not use in any way ● ● ● ● ● ●
I have heard and used in ● ● ● ● ● ●
Have visited seminars ● ● ● ● ● ●
have prepared strategy for e-commerce ● ● ● ● ● ●
planning for using e-commerce ● ● ● ● ● ●
Undertaking e-commerce development ● ● ● ● ● ●
we are extensive user of e-commerce ● ● ● ● ● ●
we are extensive user of other technology ● ● ● ● ● ●
internal e-commerce speeds ● ● ● ● ●
401
Appendices
communications
make organisation more effectint ● ● ●
email is useful for communication ● ● ●
e-commerce provide effectint ● ● ●
increase real storage way ● ● ●
Lower cost ● ● ● ●
retained/gained customers ● ● ●
better relationship with partners ● ● ●
less paper handling ● ● ●
better control over information ● ● ●
reduction in admin task ● ● ● ●
2.5 Disadvantages/ reason not adopting
We don't fully understand it ● ● ●
we don't know we to go to learn about it ● ● ●
we cannot use it ● ● ● ●
it does not reduce costs
we don't have time ● ● ●
we can not afford the cost ● ●
we are fearful of security ● ● ●
we have the willing but we don't have
support ● ●
is a lack of government and industry -led
visibility ●
There are lack of legal issues ● ● ●
it leads to more mundane jobs and job
losses
2.6 Are there any other reason?
No internet ● ●
3 The internet
3.1 Who is you internet provider
LTT ● ● ● ● ● ●
GPTS ● ● ● ● ● ●
Satellite ● ● ● ● ● ●
Others ● ● ● ● ● ●
3.2 What is the type of connection?
Modem ● ● ● ● ● ●
Lise line ● ● ● ● ● ●
Broadband ● ● ● ● ● ●
Wireless ● ● ● ● ● ●
Other ● ● ● ● ● ●
28KB ● ● ● ● ● ●
56KB ● ● ● ● ● ●
64KB ● ● ● ● ● ●
128KB ● ● ● ● ● ●
256 ● ● ● ● ● ●
512 ● ● ● ● ● ●
402
Appendices
Don’t know
3.3 What tool do you use when
accessing the internet?
Archie ● ● ● ● ● ● ●
Email ● ● ● ● ● ● ●
FTP ● ● ● ● ● ● ●
Mailing list ● ● ● ● ● ● ●
Newsgroup ● ● ● ● ● ● ●
Remote login ● ● ● ● ● ● ●
Internet browser
Chat
www via email
3.5 Do you have a web site? ● ● ● ● ● ● ● ● ● ●
3.6 If the answer yes do you update in-
house or by third party
in-house ● ● ● ● ●
third party ● ● ● ● ●
Don’t know ● ● ● ● ●
3.7 Do you have internet security such
as Firewall? ● ● ● ●
3.9please specify the reason of using
internet cafes
for self improvement ●
For internal calls ●
for External call ●
For web site visiting ●
for chatting ●
File transfer ● ● ●
trade ●
upload files ● ● ●
purchases ● ● ●
sell and marketing ● ● ●
to get information ● ●
others
3.10 What do you think the most
internet features? ●
Information and easy to contact
Cost ●
3.11 What are the internet
disadvantages
Security, ●
Culture, ●
speed ●
No answer
3.12 what are the barriers in Libya
Infrastructure, , ●
Government involvement ●
Young people
403
Appendices
misunderstanding of the real meaning ●

No answer
3.14 what is the best solution for the
internet to succeed in Libya?
Reduce cost ●
Knowledge and educations ●
Family support ●
Improvement ●
Cost reduction ●
Cards ●
404

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E-commerce and Economic Development

A thesis submitted to the University of Wales Institute, Cardiff for

In the end of this research I would like to emphasize my appreciation to:

 My parents who support me financially and provided me the confidence

 My supervisory team for guiding me through my journey

 People who agreed to be interviewed and who accepted to answer the

To all, thank you very much.

Abstract ..................................................................................................................................................... XII

Chapter one: Introduction

Chapter two: Economic development

Chapter three: E-commerce

Chapter six: Findings

Chapter seven: The three-quarter moon chapter

Chapter eight: Conclusion chapter

9.0 References............................................................................................................................................ 292

2.1 Economic growth items ........................................................................................................................ 29

2.1 economic development model based on it ........................................................................................... 36

The research process involves a mixed research approach. Firstly, 15 semi-structured

ADSL Asymmetric Digital Subscriber Line

AR Al-Reiad Internet Café

ATM Automated Teller Machine

AW Al-Wesam Internet Cafe

B2B Business to Business

B2C Business to Consumer

BA Bader Al Hasse Group

C2C Consumer to Consumer

CBL Central Bank of Libya

CPI Consumer Price Index

DSL Digital Subscriber Line

DVB-RCS Digital Video Podcasting- Return Channel by Satellite

E-commerce Electronic commerce

E-economy Electronic Economy

E-government Electronic Government

E-mail Electronic Mail

E-procurement Electronic Procurement

FDI Foreign Direct Investment

G-8 Group of eight industrial countries

GDP Gross Domestic Product

GNI Gross National Income

HDI Human Development Index

ICT Information and communication technology

ISP Internet Service Provider

L.D Libyan Dinar

LCB Libyan Commercial Bank

LDCs Less Developed Countries

LTT Libyan Telecommunication Technology

M-commerce Mobile Commerce

MEB Mobile Websites

MIDS Matrix Information and Directory Services

MOC Ministry of Commerce

NGO Non-Governmental Organisations

OCC Oil and Construction Company

OLPC One Laptop Per Child

OPEC Organisation of Petroleum Exporting Countries

OPTC Organisation of postal and telecommunication Company

PPP Purchasing Power Parity

SMEs Small and Medium Enterprises

TFP Total Factor Productivity

TNC Transnational Corporation

U.K United Kingdom

U.S. United Sates of America

UNCTAD United Nation Conference in Trade and Development