E-Commerce in Negara Brunei Darussal

Running head: ELECTRONIC COMMERCE
Electronic Commerce
Name of Student:
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Authors Note
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Contents
Abstract............................................................................................................................................3
Introduction......................................................................................................................................4
Literature Review............................................................................................................................4
Research Method...........................................................................................................................10
Results and Summary....................................................................................................................13
Discussion......................................................................................................................................14
Conclusion.....................................................................................................................................20
References......................................................................................................................................21
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Abstract
This study examines the factors which are related with development of an appropriate e-
commerce scenario in Negara Brunei Darussalam which can assist in the diversification of the
economy of the country. This reports proceeds with the development of a questionnaire survey
and conducting research on 100 respondents in Negara Brunei Darussalam belonging from all
levels of the society and from all income group. A literature review states that that e-commerce
is very important from the point of view of Negara Brunei Darussalam in order to diversify the
economy of the country. Upon research it has been observed that that the present IT
infrastructure of Negara Brunei Darussalam is not adequate enough to support e-commerce
activities in Negara Brunei Darussalambecause of various elements such as inadequacy of trust
among the buyers regarding online products, lack of effective participation of all level of SME’s,
lack of adequate security in order to prevent financial fraud during e-commerce activities and
absence of domestic e-commerce companies in the e-commerce sector of Negara Brunei
Darussalam. In order to develop the e-commerce scenario in Negara Brunei Darussalam it can be
suggested that the e-commerce companies should work in collaboration with the government of
Negara Brunei Darussalam in order to develop the IT infrastructure of the country and to develop
the security and IT governance framework of the country in order to develop trust and
confidence among the general buyers of Negara Brunei Darussalam. The government of Negara
Brunei Darussalam also need to improve the telecommunication infrastructure of the country in
order to facilitate fast internet connection at reasonable process so that digitalization of the
economy occurs in an effective manner.
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Introduction
Despite the efforts put forward to promote e-commerce adoption in Negara Brunei Darussalam,
research depicts that most of the individuals of the country are reluctant to embrace e-commerce
in an effective way due to lack of trust and confidence in the e-commerce infrastructure of
Negara Brunei Darussalam . Researches also depict that customers are shying away from
utilizing e-commerce to their fullest potential due to lack of adequate security in online financial
transactions which leads to financial fraud. Research also depicts that various SME’s have not
adopted the e-commerce platform as anticipated. This report focuses on the e-commerce scenario
in Negara Brunei Darussalam and proposes ways to enhance the e-commerce usage in the
country by conducting a research and analysing the various factors which influences e-commerce
scenarios in the country and accordingly suggest ways to develop the e-commerce activity of the
country so as to diversify economy of country.
Literature Review
E-commerce also known as electronic commerce or internet commerce is defined as buying and
selling of goods and services through internet and also exchange of money and data in order to
execute transactions. According to Asia News Monitor (2018) E-commerce has gained
unprecedented growth and importance in the last decade owing to the advantages if offers to the
buyers, sellers and the overall economy of a country. As opined by Morgan (2013) E-commerce
helps in diversifying the economy of a country as it enables SME’s to sell their products to a
large number of customer using an internet platform which otherwise becomes difficult to sell
through offline platforms considering the huge costs which are associated with it. E-commerce
also provides huge employment opportunity to the workforce of a country considering its huge
scope of operations. The success of e-commerce of a country depends on the IT infrastructure of
a country, the technological advancement of a country and the acceptance of the online platforms
among the buyers of the country.The government of a country also plays a huge role in
acceptance and popularity of e-commerce activities in country by developing and implementing
policies which supports the growth of e-commerce platforms.As opined by Al-Somali, Gholami
& Clegg (2015) there are various factors which determine the success of e-commerce adaptation
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in a country like government support regarding growth and improvement of e-commerce, IT
infrastructure of country, knowledge of people of country regarding Information technology, IT
security framework adopted by the e-commerce companies, relative advantage of e-commerce in
the country and competitive pressures. As stated by Asghar, Zhang & Brem (2013) the
adaptation of e-commerce scenario is very significant from point of view of a country as with
help of the e-commerce platform, SME’s of various sizes can sell their products to a large
number of potential customers which not only helps in increasing their business performance but
also helps in diversifying the economy of a country. The importance of SME’s stem from their
increased role in job creation and economic growth of a country and therefore it is very
important for SME’s to adopt e-commerce so as to be more competitive in market and to play
more important role in extending economy of a country. As opined by Krishna & Singh (2018)
E-commerce offers competitive advantage to SME’s as it involves lower cost for SME’s to sell
their products through online platform compared to offline platform. E-commerce also helps in
the increase of sale of domestic products of a country which helps in boosting the economic
growth of the country.
E-commerce has a high growth potential which helps in generating economic growth for a
nation. In order to identify its entire capacity to create the structural transformations required for
economic improvement, it is very essential to identify that e-commerce offers an effective
environment in which new activities can productively be extended. As stated by Safa & von
Solms (2016) the interaction of e-commerce with distinct components of development has to be
self-reinforcing in nature in order to bring about the required amount of growth. E-commerce has
been present historically since previous two decades in various forms but growth and popularity
of the internet has become a vital factor which has helped e-commerce gain its popularity. There
are six forms of e-commerce which have been recognized by the WTO in the form of telephone,
TV, fax, electronic payment and money transfer system, internet, electronic data interchange.
The evolution of e-commerce as a powerful and vital instrument for economic growth in the last
decade has been an outcome of transformation from private and closed network system to an
open and public network platform in form of internet. The internet helps in providing access to e-
commerce all the year round at any place and at any time which helps in removing the time and
place constraints which are associated with traditional commerce. E-commerce has built itself on
structure of conventional commerce by adding lucidity characteristics which are providedthrough
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electronic networks. Therefore it allows businesses and SME’s of a country to sell their products
at any time to a large number of customers at any location with the help of internet which
enables them to maximize their profit and also contribute to the development of the country. This
advantage promotesenrichment in operations which leads to considerable cost savings as well
helps in enhancing competitiveness and efficaciousness through restructuring
ofconventionaltrade.
E-commerce is such an activity which has helped in generating new components in economic
development and has helped multiple nations to achieve a bigger level of enrichment in the
current years which creates an investment climate which is conductive for future economic
growth. As stated by Al-Bakri & Katsioloudes (2015) the economic development through the
spread of e-commerce involves the creation of novel economic activities. The rise of e-
commerce leads to emergence of new productive sectors which changes the structure and the
organizations in a drastic manner of the old activities which were carried out by traditional
sectors. The history of economic growth reveals that that a process of structural change such as
e-commerce is vital for accelerating growth in the economy.
As stated by Mazzarol (2015) during the analysis of e-commerce on economic development, ICT
seems to have separate effects on productivity and growth. Firstly investment of capital goods in
the ICT framework leads to overall capital deepening which helps in increasing labour
productivity. Secondly, fast progress of technology in the manufacturing of ICT goods and
services contributes to higher multi-factor growth of productivity in the ICT production sector.
Thirdly higher use of ICT helps small business and SME’s to increase their overall efficiency
which also helps in raising multi-factor productivity. The greater use of CT technology in the
form of activities such as e-commerce also leads to network effects in the form of reduced
transaction costs and faster rate of innovation which will help in improving the overall efficiency
of an economy such as multi-factor productivity.
As opined by Abebe (2014)E-commerce has the potential to add a greater value to various
businesses and consumers of the developing countries more than the developed countries but
majority of the developing countries have failed relatively to reap the benefits which are
associated with modern information and communication technologies such as e-commerce and
internet shopping. There are several business models which have come up which helps in
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