The study showed that Asia/Pacific eGovernment spending in 2002 reached US$880.1mn, and is forecast to reach US$1,477.6mn in 2007, with a 2002-2007 Compound Annual Growth Rate (CAGR) of 10.9%. The Internet provides an environment for governments to transform and improve the way they govern.

However, to succeed in this transformation, eGovernment needs high-level leadership support and accurate measurement tools in place to track the success and benefits of eGovernment. IDC's study also found that in terms of progress to date and support infrastructure in place, Asia's leading eGovernments are Australia, Singapore, and Hong Kong.

"Asian governments are increasing eGovernment investments because they feel a pressure to compete with other governments, and they have seen past investments provide real benefits," said Nathan Midler, Senior Analyst, Internet and eBusiness research, IDC Asia/Pacific. "Leading governments started early, and have remained committed to advancing a vision of eGovernment across the whole of government."

Cost savings from eGovernment come in the form of putting in place IT solutions, such as online registration and Web-based tax filing, which significantly reduce costs per transaction. IDC's study found that savings from such projects support further eGovernment initiatives and help free up funding to be spent elsewhere. Aside from cost savings, simply making government more efficient can improve the overall competitiveness and positioning of the market's private sector, saving the private sector time and money. An excellent example of improving efficiency is placing previously hard-to-find information online in an easy-to-access format.

Importantly, eGovernment initiatives can also be a determining factor when foreign investors look to invest within Asia. Low labor costs have long been heralded as the driving factor behind moving manufacturing into Asia, but some companies have found that hidden costs of dealing with local officials, unclear regulations, and ingrained bureaucratic delays can shave away the benefits of labor cost savings. For Asia's leading economies that are now competing with the region's low labor markets for investment, eGovernment services have emerged as a way to balance the drag of relatively higher labor costs by offering investors convenient, transparent online government platforms for handling business to government transactions.

IDC notes that not all eGovernment projects succeed, and the reason many projects fail is a lack of leadership support. eGovernment is a technology proposition that shakes up traditional bases of power in order to deliver new levels of efficiency and effectiveness. It takes a committed leadership to weather the political in-fighting that can swell up during eGovernment project implementations.

ASIA/PACIFIC eGOVERNMENT IT SPENDING, 2002-2007 (US$M) - IDC, 2003

For more information on this survey, or to purchase a copy of the "Asia/Pacific eGovernment Dynamics: Forecast, 2002 - 2007" (#AP181422K), please contact Ivy Lok at +852-2905-4232 or email: ilok@idc.com.