UNCTAD Stresses the Need to Close the Digital Divide

In its recent study, Digital Economy Report, UNCTAD points out that since 2015, the number of internet users in the world has increased from 3bn to 5.3bn. Mobile broadband subscriptions have surged from 3bn to nearly 7bn. And global internet protocol traffic – a proxy for data flows – has tripled from 46,000 to 150,000 gigabytes per second. This growth has been in 3 phases, first, where digital data is mostly shared by text (for example on LinkedIn), second, where data is mostly shared by image (eg. on Instagram), and finally, to a world where data is shared by video (on TikTok). With the spread of 5G, the growing number of Internet of Things devices and greater use of artificial intelligence (AI), UNCTAD notes that data and data flows will continue expanding rapidly. For example, AI-driven ChatGPT trained itself on 570 gigabites of text data – about 300bn words, with 100tn parameters. But these processes UNCTAD shows are deepening already existing digital divides.

The US and China are the frontrunners in harnessing data, according to the report. Many developing countries remain mostly providers of raw data to global digital platforms, while having to pay for the digital intelligence generated from their data. In some countries 80% of internet users shop online, in many developing countries this figure is less than 10%. Furthermore, within countries, there are significant divides between rural and urban areas, as well as between men and women. Some developing countries, such as India, are narrowing the gap and pushing development through data-driven digital technologies. India’s digital public infrastructure programme has resulted in digital payments becoming almost universal. That has seen the opening of almost 500m new bank accounts in both urban and rural areas, and, importantly, it has lowered data costs by 90%. New banking has in turn added almost 9m new taxpayers in the last 5 years.

The Report concludes that when well managed data can help address global development challenges, such as pandemics and climate change and promote prosperity. But the Report warns that negligent handling of data and data flows can contribute to adverse development outcomes on the environment, security, human rights and inequality. The Report counsels that countries should harness the development potential of data by developing governance frameworks that work for national priorities, while not impeding opportunities to be gained from sharing data across borders. This latter point should be noted by those developing countries which are too keen to apply data localisation policies without properly considering the downside.