top of page

Roadmapping Ecommerce Development: New Ecommerce Development Survey and Index  

Nextrade Flagship Database and Index for U.S. Agency for International Development (USAID) under Palladium's iBeam work to guide policymaking and aid allocations in ecommerce. Nextrade is now globalizing the empirical work with World Bank.


Get the report here 


Ecommerce is reshaping the patterns, players, and possibilities of international trade. It is opening new trade opportunities for companies of all sizes and across sectors. Nnumerous challenges need to be overcome for digitization to translate into trade and growth gains especially in developing countries, such as poor Internet connectivity, populations’ limited digital skills, logistics and market access bottlenecks, and policy and regulatory issues such as data privacy rules that limit access to customer data and its transfer, incomplete intellectual property frameworks, and legal liabilities for Internet intermediaries of contents such as user reviews on their portals.


However, lack of systematic and actionable data on the severity of these challenges complicates developing countries and aid agencies’ design and prioritization of public policies and investments in ecommerce development. There are no clear roadmaps for improving the enabling environment for ecommerce.

new Ecommerce Development Survey and Index developed by Nextrade Group for USAID fills this gap. Covering 15 developing economies (Argentina, Brazil, Chile, Colombia, Mexico, Uruguay, Pakistan, Bangladesh, India, Philippines, Kenya, Nigeria, South Africa, and Ghana) and 3,500 merchants and ecommerce ecosystem companies (ecommerce and payment platforms, shippers, banks, IT firms, etc.), the survey provides granular and actionable policy insight for governments to unlock ecommerce and tailor interventions to meet the needs of different types of firms, such as small vs large, exporters vs. non-exporters, and online sellers vs. offline sellers.

The study also creates a new Ecommerce Development Index that enables countries to compare themselves to their peers and to tracking private sector views on ecommerce development across different issues areas, such as payments, logistics, and regulations. The key findings include:

  • In every size category, companies with online sales are much likelier to export than companies that do not have online sales. While fewer than 20 percent of small offline sellers export, about 50 percent of small online sellers do, and while offline exporters tend to export to only one market, over 60 percent of online sellers export to two or more markets.

  • Online sellers are more geographically diversified: some 63 percent of online sellers export to two or more markets, while only a third of offline sellers do. Offline sellers that export typically export to only one foreign market. Companies with online sales also derive a larger share of their revenues from exports than companies that do not buy or sell online. Companies that sell online are likelier to be faster-growing than offline sellers, controlling for company size.

  • Small companies tend to be considerably more affected by challenges in the enabling environment for ecommerce than large companies in every country, with access to finance and ecommerce logistics posing particularly steep challenges for small businesses. Midsize and large companies, meanwhile, wrestle most with logistics and digital and other regulations. The gaps are significant between small and large companies: for example, some 60 percent of surveyed small companies rate areas of ecommerce enabling environment 5/10 or below, while only a third of large companies do. These differences are echoed in responses to questions about cross-border ecommerce.

  • Perceived challenges to ecommerce vary very significantly across and within countries; every country has its idiosyncratic challenges, which means that policy recommendations and interventions need to be tailored to each country. For example, in some countries such as Bangladesh, online payments are a leading problem to ecommerce; in others such as Argentina and Kenya, cross-border logistics and customs procedures are the most challenging. In still other countries, such as Brazil, ecommerce and digital regulations and the overall regulatory environment complicate ecommerce. In Nigeria, access to finance issues and logistics dominate the list of problems. In Pakistan, the high cost of broadband and lack of Internet connectivity are reported to hamper ecommerce.

  • Actionable insight into ecommerce development priorities requires granular data. For example, within the broader categories of logistics and regulations, developing country merchants see such challenges as total cost of delivery, legal liability rules, and customs procedures for ecommerce imports as most critical. Ecommerce ecosystem companies meanwhile highlight a range of digital regulations around copyright rules, data privacy, and legal liability as challenging for cross-border ecommerce.

  • Companies believe that undoing barriers to ecommerce would result in significant revenue and growth gains. If their top-3 perceived challenges to ecommerce were removed, developing country companies believe they would score annual revenue gains of 34 percent in their domestic markets and 30 percent in international markets. Small companies report gains of 37 percent domestically and 34 percent internationally.

  • Companies that have yet to start selling online worry about complexities related to exporting and uncertainties related to the return on investment of online sales. Companies in Latin America highlight logistics as a challenge, while companies in Africa mention small size of the market as an obstacle.

  • Brazil, India, Mexico, and Colombia come out on top in the Ecommerce Development Index; Ghana, South Africa, Bangladesh and Pakistan score lowest. The rankings are similar also in an ecommerce inclusiveness index developed in the study. They are also quite correlated with countries’ level of development. Brazil and India also overperform on the index when compared to their level of development, while LDCs underperform. However, also Brazil and India have a great deal of work ahead. Their average scoring was far from a perfect 10 – in both, merchants rated the enabling environment for ecommerce at 7.

bottom of page