Developing nations diverge in abilities to embrace new tech, UN report says

Frontier technology represented a $350bn market in 2018 but will surge to over $3.2tn by 2025

Each wave of technological change has brought inequality in a new shape in the past, the Unctad report said. AFP

A few developing nations have strong capabilities to adopt and adapt frontier technologies that can help them recover from the Covid-19 pandemic, but most lag behind, a new United Nations report shows.

Frontier technologies that take advantage of digitalisation and connectivity represented a $350 billion market in 2018. That will surge to more than $3.2 trillion in the next five years, according to a report from the United Nations Conference on Trade and Development. The survey ranks 158 countries in terms of their readiness to adopt these technologies.

The US and European countries dominate the top 10 places, but developing nations such as India, the Philippines, Ukraine and Vietnam are credited as outperformers in terms of technological adoption, relative to the size of the economies.

“Technological progress is essential for sustainable development but can also perpetuate inequalities or create new ones. The task for governments is thus to maximise the potential benefits, while mitigating harmful outcomes,” the report said.

Frontier technologies include artificial intelligence, the Internet of Things, big data, blockchain, 5G, 3D printing, robotics, drones, gene editing, nanotechnology and solar photovoltaic panels, among others.

The top performers in the index are typically associated with world-class innovation and high gross domestic product. The top five countries in the overall index were the US, Switzerland, the UK, Sweden and Singapore.

And although some emerging nations have shown prowess in adopting cutting-edge technology, Unctad warned of serious implications for developing countries if they are either "overwhelmed" or "simply left behind".

“It is key that developing countries do not miss the wave of frontier technologies, otherwise it will further deepen inequalities,” Unctad’s acting secretary-general Isabelle Durant said.

Societies and productive sectors need to be well prepared and build the required skills, Ms Durant said. “Frontier technologies have already brought enormous benefits, but rapid advances can have serious downsides if they outpace the ability of societies to adapt,” she added.

Countries best prepared to equitably use, adopt and adapt these technologies are mainly in Northern America and Europe. Those least prepared are in sub-Saharan Africa and other developing regions, according to Unctad.

“Technologies are not deterministic … we can shape their pathways for good … and we have an obligation to do it,” Shamika Sirimanne, Unctad’s director of technology and logistics, said.

“Governments and other development actors will need to prepare fast. Developing countries, particularly the least developed ones, can’t afford to miss this new wave of rapid technological change,” she added.

The UN body also said developing countries need to work towards achieving universal internet access and ensure all of their citizens have opportunities to learn the skills required for frontier technologies.

“A whole-of-government approach is needed to absorb these technologies, as opposed to working in silos,” Ms Sirimanne said. Developing countries should also align science, technology and innovation policies with industrial policies, she added.

“New technologies can re-invigorate traditional production sectors and speed up industrialisation and economic structural transformation.”

Each wave of technological change has brought inequality in a new shape in the past, the report said.

“The outcomes for one generation have affected the opportunities for the next, resulting in inter-generational transmission of inequalities. Between 1820 and 2002, the contribution of between-country inequality to global inequality rose from 28 per cent to 85 per cent,” it added.

Currently, the major concerns are related to the risk of automation taking jobs, declining labour rights, inequalities created by market and profit concentration and the increase of disparity driven by AI and widening technological gaps.

The effect that inequalities will have within and between countries will largely be shaped by national policies, Unctad said.