Poorer countries need privacy laws as they adopt new technologies

Tunisians at an internet cafe in El Djem. Unctad warns that storing and accessing data remotely brings a range of legal as well as technological and infrastructure challenges for poor countries. Photograph: Oliver Berg/EPA

Developing countries need to adopt and enforce privacy and data protection laws as they attempt to bridge the "digital divide" widened by the advent of new technologies like cloud computing, according to a new report.

The Information Economy Report 2013, released on Tuesday by Unctad, the UN trade and development body, warns that the global shift towards cloud computing, which allows users to store and access data remotely, brings a range of legal as well as technological and infrastructure challenges for poor countries.

"Cloud computing has the potential to offer users in developing countries access to unprecedented resources of computing power and storage," says the report, noting how cloud services can help cut costs on hardware and software, provide greater flexibility and mobility, and enable worldwide collaboration. However, it warns that as services offered via the internet become more complex, unreliable and expensive broadband access in many developing countries, together with power outages and a lack of IT skills risk widening the digital divide.

"We've had the tendency to look at the digital divide in terms of whether you have access or not to technologies, and so some think the digital divide is closing because more people have access to mobile phones. But it's important not only to have access but to have quality access," said Torbjörn Fredriksson, lead author of the report.

During an average minute in 2012, Google received 2m search requests, Facebook users shared around 700,000 content items and Twitter sent out 200,000 tweets, notes the report. However, an estimated 60% of such cloud traffic came from Europe and North America, followed by the Asia-Pacific region (33%). Latin America, the Middle East and Africa together accounted for only 5%.

Broadband prices remain high in many poor countries. While in 2011 the average monthly price for fixed broadband was estimated at less than 2% of per capita income in developed countries, in developing countries that figure was 40%. The cost of mobile broadband in poor countries is between 20% and 30% of per capita income.

Data security and privacy concerns –which have intensified worldwide following the revelations in 2013 about NSA national surveillanceprogrammes and reports on access by law-enforcement agencies to data hosted by cloud service providers – are among the most important issues facing developing countries, says Unctad.

Some cloud applications, particularly consumer-focused services like webmail, are already being used in many developing countries despite the lack of data protection laws, said Fredriksson. "It is very important to accelerate attention towards these areas … countries need to be aware of the potential, but also the risks of the cloud"

As of 2013, 101 countries had data privacy laws or bills in place. Only 40 developing economies have such laws or bills .

"For governments of developing countries, it is essential that appropriate laws and regulations are adopted and enforced in these areas," says the report.

Cloud services today are dominated by a few very large service providers, almost all with headquarters in the US.

The NSA revelations have caused people worldwide to doubt the wisdom of entrusting their data to cloud services operated by American companies, and some US firms have said they risk losing billions of dollars as customers become increasingly wary of using their services.

"The debate that has been sparked is very useful in that governments and other users are forced to think through the implications of uploading data to the cloud. This does not only relate to developed countries but to developing countries too," said Fredriksson.

Carly Nyst, head of international advocacy at NGO Privacy International said no government, company or development agency should "blindly move" to promoting cloud services before the privacy of individuals online can be ensured.

"With all of the potential that cloud computing holds, it also poses some serious risks to the protection of a user's personal information," she said. "This is especially true in developing countries, where an absence of strong data protection and privacy laws, coupled with weak accountability mechanisms, means that information stored in the cloud is vulnerable to a variety of threats, from hacking to corporate exploitation to a snooping government."

This month the UN adopted a resolution drafted by Germany and Brazil reaffirming the "human right to privacy in the digital age". The resolution was also sponsored by developing countries Bolivia, Ecuador, Indonesia, Peru and Uruguay.