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Leveraging Digital Transformation for Stronger and Smarter World Economic Recovery

28 March 2022

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Berlin, 28 March 2022: The digital transformation – the adoption of online business models and the general shift of economic and social activities online - particularly  during the COVID-19 pandemic  has changed the way  economies function,  the way businesses operate, and the way societies interact. The exploitation of data enables new smart city models and under pins the emergence of a new kind of data driven economy. For advanced and developing countries of G20, it opens up new opportunities for international cooperation to leapfrog intermediate infrastructure of the industrial age, taking advantage of new markets offered by digital platforms and exploiting enhanced service delivery offered by smart technologies.

T20 Indonesia, the Bandung Institute of Technology Global Solutions: World Policy Forum in cooperation with ERIA organized a webinar session on 29 March.  Mr. Johnny Gerard Plate, the Minister of Communication and Informatics of the Republic of Indonesia gave the keynote address. ‘Digital transformation is increasingly becoming a global engine of sustainable economic growth, with over 30% of GDP expected to depend on digital technologies by 2030. To enable this growth digital connectivity must be considered an essential service for all’  he mentioned. As host this year of the G20, Indonesia is committed to unleash the full potential of digital transformation as a driver for global recovery with a rigorous, tangible action plan. 

The panel discussion led by  Prof Suhono Harso Supangkat,  (Bandung Institute of Technology, Indonesia)  revolved around the question of how governments, policymakers, businesses, and academia can collaborate more effectively to ensure universal and affordable internet access while also closing the digital divide and ensuring the reliability of cross-border data flows.  And how can digital transformation, as embodied in digital government and smart city/village initiatives, contribute to economic recovery and the achievement of the Sustainable Development Goals (SDGs)?

ERIA’s Director for Research and Strategy and Innovations, Dr Venkatachalam Anbumozhi, joined other  three panellists  Messrs Christopher Meinal,(Hasso Plattner Engineering, Berlin), Scott Marcus, (Bruegl, Brussels)  and Toshio Obi (Waseda University, Tokyo) in discussing the questions and identifying the policy pathways for making digital transformation inclusive and green.  They agreed that digital transformation is a key driver of economic development, a funda­mental lever in fighting climate change, and a powerful enabler of social inclusion. Four main trends contribute to expanding the potential and the opportunities related to digital technologies (i)  Increasing digital and connected population during the pandemic  (ii)  Improving connection quality worldwide  (iiI) Rising adoption of Big Data and Artificial Intelligence technologies and (iv) Growing Internet of Things and Machine-to-Machine use cases.

However, the panelists observed that the potential of Digital Transformation is yet to be fully realized and is still limited by five structural factors namely heterogenous network capacity, reach and quality across different regions; gaps and inconsistencies among regulatory principles leading to potential competitive imbalances;  lack of trust in digital technologies due to cybersecurity and privacy con­cerns, as well as issues related to respect for human rights, national security, and digital sovereignty;  limited digital offering due to uneven awareness of technology use cases and Low digital readiness among companies, citizens, and workers further im­pacting the take-up of digital solutions.

Hence, the panel called upon the G20  governments  to  (i) Accelerate the roll-out of high-capacity, future-proof digital infrastructure, enhance technology accessibility, and create on-ramps to the digital eco­nomy for the excluded to foster innovation, competition, cooperation, as well as inclusion and sustainability; (ii) Harmonize regulatory principles to ensure fair competition and efficient markets; promote trust in the digital ecosystem by enhancing cybersecurity and privacy protection, and encourage the adoption of interoperable policy frameworks and common standards to facilitate cross-border data flows (iii)  Foster Governments' and companies' responsible development and de­ployment of digital technologies by leveraging public and private coopera­tion in R&D, promoting investments and effective use case sharing and (iv) Address the existing digital skills gap in the private and public sector by mapping current shortages, up/re-skilling individuals, updating education curricula and encouraging a mindful usage of technologies.

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