{"id":55551,"date":"2022-05-12T10:50:30","date_gmt":"2022-05-12T10:50:30","guid":{"rendered":"https:\/\/revistaidees.cat\/?p=55551"},"modified":"2022-05-12T10:50:35","modified_gmt":"2022-05-12T10:50:35","slug":"risks-and-opportunities-of-the-digital-transformation","status":"publish","type":"post","link":"https:\/\/revistaidees.cat\/en\/risks-and-opportunities-of-the-digital-transformation\/","title":{"rendered":"Risks and opportunities of the digital transformation"},"content":{"rendered":"\n

According to Heeks [1]<\/a>1 \u2014 Heeks (2019). ICT4D 3.0? Part 1\u2014The components of an emerging \u201cdigital for-development\u201d paradigm; DOI: 10.1002\/isd2.12124.\n<\/span><\/span>, digital technologies have impacted international development in three particular ways: they now reach almost all low-income communities, both in urban and rural contexts (reach), they are relevant to almost all development issues and sectors (scope), and they play a vital role in all aspects of development processes (depth). Given the changing patterns in the field of international development these three impact dimensions can be associated with the major challenges: transformation (incremental developmental changes are no longer sufficient), inclusion (decision making beyond elite circles), and sustainability (development within the remits of planetary boundaries) [2]<\/a>2 \u2014 See:\n\nDalby, S. (2016). Contextual Changes in Earth History: From the Holocene to the Anthropocene \u2013 Implications for Sustainable Development and Strategies of Sustainable Transition. A: Bauch, G. G.; Spring, U. W.; Grin, J.; Scheffran, J. (eds.). Handbook on Sustainable Transition and Peace (p. 67-88). Cham: Springer.\nHeeks (2019). ICT4D 3.0? Part 1\u2014The components of an emerging \u201cdigital for-development\u201d paradigm; DOI: 10.1002\/isd2.12124.\n\n<\/span><\/span>. Digital technologies have become the technical backbone of an ongoing transformation and of almost all economic activities; being the prerequisite for the seamless flow of data and information as well as goods and capital. However, the question, whether the ongoing digitalization will also contribute to the other two core themes, inclusion and sustainability, remains open.<\/p>\n\n\n\n

Many governments and international organizations see great potential in digitalization for the socio-economic development and for a vital digitalized economy setting high expectations in the digitalization of the economy and its potential to drive the development of the industrial and service sectors [3]<\/a>3 \u2014 Fritzsche, K.; Kunkel, S.; Matthess, M. (2020). Digitalized economies in Africa. Structural change in a dynamic environment. IASS Fact Sheet, 2\/2020.\n<\/span><\/span>. However, many scholars argue that along with economic rationalization and increased efficiency, social and cultural values may be violated. They acknowledge a significant risk that the digital divide between developing countries and more technologically advanced countries could widen even further and that existing economic and social disparities will be reinforced at the expense of developing countries [4]<\/a>4 \u2014 See:\n\nKwilinski, A.; Vyshnevskyi, O.; Dzwigol, H. (2020). Digitalization of the EU Economies and People at Risk of Poverty or Social Exclusion. Journal of Risk and Financial Management, 13(7), 142.\nMatthess, M.; Kunkel, S. (2020). Structural change and digitalization in developing countries: Conceptually linking the two transformations. Technology in Society (Vol. 63, p. 101428). Elsevier BV. Available online.\n\n<\/span><\/span>.<\/p>\n\n\n\n

The following sections will address particularly the challenges of inclusion and sustainability. In addition, the policy implications for improving the present situation will be briefly discussed before the paper concludes with some general observations and lessons learned.<\/p>\n\n\n\n

Inclusion: Access, digital divide and social equity<\/h5>\n\n\n\n

<\/p>\n\n\n\n

Access to digital services for domestic economies and industries<\/em><\/h6>\n\n\n\n

The effects of digital technologies can be studied at the individual, organization, country, region and global level. Common examples for constructs to measure economic effects are the GINI co-efficient (gap between poor and rich), the Purchasing Power Parity (ability to pay for needed goods and services), or the human development index (human capital and financial poverty). The latter is also used as a construct for the measurement of human well-being; other such indices are the Gender Development Index, or the Human Poverty Index. The digital part of the equation is often operationalized through indicators such as access to mobile phones, internet or broadband, information and communication technology (ICT) diffusion, robot installations, or volume of e-commerce per observation unit.<\/p>\n\n\n\n

When looking at indices for equity or equal access to digital technology, many developing but especially African countries achieve only low scores. The share of population using the internet can be seen as one typical indicator in that regard (see Figure 1).<\/p>\n\n\n\n

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Figure 1: Share of population using the Internet in 2019 (retrieved from ourworldindata.org\/technology-adoption<\/a> CC BY).<\/figcaption><\/figure>\n\n\n\n

With regard to industry-centered indices like robot installations, values are even more unevenly distributed globally (see Figure 2). 74 % of all robot installations occur in just five countries: USA, China, Germany, South Korea, Japan [5]<\/a>5 \u2014 International Federation of Robotics (IFR) (2020). Executive Summary World Robotics 2019 Industrial Robots. Frankfurt am Main. Available online. Consultation date: 6\/1\/2022.\n<\/span><\/span>. When neglecting China, as an immensely relevant player in this field, not a single developing country is playing a relevant role according to the statistical data.<\/p>\n\n\n\n

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FFigure 2: Distribution of robot installations in 2018 [5]<\/a>5 \u2014 International Federation of Robotics (IFR) (2020). Executive Summary World Robotics 2019 Industrial Robots. Frankfurt am Main. Available online. Consultation date: 6\/1\/2022.\n<\/span><\/span>.<\/figcaption><\/figure>\n\n\n\n

Big IT brand firms outsource 80% of manufacturing to only five supplying manufacturers – all located in either North America, Taiwan and Mainland China [6]<\/a>6 \u2014 Raj-Reichert, G. (2018). The Changing Landscape of Contract Manufacturers in the Electronics Industry Global Value Chain. A: Nathan, D.; Meenu, T. & Sarkar, S. (eds.). Development with Global Value Chains: Upgrading and Innovation in Asia. Cambridge University Press.\n<\/span><\/span>. Subsequently, the ICT sector is highly concentrated (see Figure 3): in 2017 only ten economies accounted for more than 90% of global value added in ICT manufacturing [7]<\/a>7 \u2014 UNCTAD (2019). Digital Economy Report 2019. Value Creation and Capture: Implications for Developing Countries. UN. New York. Available online.\u00a0 Consultation date: 6\/1\/2022.\n<\/span><\/span>.<\/p>\n\n\n\n

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Figure 3: Distribution of value added in ICT manufacturing in 2017 [7]<\/a>7 \u2014 UNCTAD (2019). Digital Economy Report 2019. Value Creation and Capture: Implications for Developing Countries. UN. New York. Available online.\u00a0 Consultation date: 6\/1\/2022.\n<\/span><\/span>.<\/figcaption><\/figure>\n\n\n\n
Contribution to equity and social opportunities<\/em><\/h6>\n\n\n\n

Technological innovation can positively influence poverty alleviation [8]<\/a>8 \u2014 Zameer, H.; Shahbaz, M.; Vo, X. V. (2020). Reinforcing poverty alleviation efficiency through technological innovation, globalization, and financial development. Technological Forecasting and Social Change, 161:120326, DOI: 10.1016\/j.techfore.2020.120326.\n<\/span><\/span>. An analysis from Mexico suggests that internet access helps to reduce poverty levels especially in rural areas [9]<\/a>9 \u2014 Mora-Rivera, J.; Garc\u00eda-Mora, F. (2021). Internet access and poverty reduction: Evidence from rural and urban Mexico. Telecommunications Policy, 45(2), 102076. DOI: 10.1016\/j.telpol.2020.102076.\n<\/span><\/span>. A panel analysis shows that internet usage (if not related to internet scams) has a positive effect on economic well-being for countries in Sub-Saharan Africa [10]<\/a>10 \u2014 Evans, O. (2019). Repositioning for increased digital dividends: internet usage and economic well-being in sub-saharan Africa. Journal of Global Information Technology Management, 22(1), 47-70. DOI: 10.1080\/1097198X.2019.1567218.\n<\/span><\/span>. E-commerce platforms do not only provide cheaper goods and services but additionally foster the development of rural and remote areas [11]<\/a>11 \u2014 Haji, K. (2021). E-commerce development in rural and remote areas of BRICS countries, Journal of Integrative Agriculture, vol. 20, n\u00fam. 4, p. 979-997. DOI: 10.1016\/S2095-3119(20)63451-7.\n<\/span><\/span>. Following a similar approach, Li et al. [12]<\/a>12 \u2014 Li, L.; Du, K.; Zhang, W.; Mao, J. Y. (2019). Poverty alleviation through government\u2010led e\u2010commerce development in rural China: An activity theory perspective. Information Systems Journal, 29(4), 914-952. DOI: 10.1111\/isj.12199\n<\/span><\/span> have suggested a model of poverty alleviation through e-commerce based on a case study from China. Several studies have explicitly emphasized the potential of digital technologies to address the issue of systemic poverty. Mbuyisa & Leonard [13]<\/a>13 \u2014 Mbuyisa, B.; Leonard, A. (2017). The role of ICT use in SMEs towards poverty reduction: A systematic literature review. Journal of International Development, 29(2), 159-197. DOI: 10.1002\/jid.3258.\n<\/span><\/span>, have found that the use of ICT by small and medium-sized enterprises (SMEs) act as a driving force for socio-economic development, such as poverty reduction. They see special benefits with regard to the use of intermediaries and community involvement [14]<\/a>14 \u2014 Cecchini, S.; Scott, C. (2003). Can information and communications technology applications contribute to poverty reduction? Lessons from rural India. Information Technology for Development, 10(2), 73-84.\n<\/span><\/span> or social outsourcing to marginalized groups [15]<\/a>15 \u2014 See:\n\nMadon, S.; Sharanappa, S. (2013). Social IT outsourcing and development: Theorising the linkage. Information Systems Journal, 23(5), 381-399.\nSandeep, M. S.; Ravishankar, M. N. (2016). Impact sourcing ventures and local communities: A frame alignment perspective. Information Systems Journal, 26(2), 127-155.\n\n<\/span><\/span>. However, Galperin & Viecens [16]<\/a>16 \u2014 Galperin, H.; Viecens, M. F. (2017). Connected for development? Theory and evidence about the impact of internet technologies on poverty alleviation. Development Policy Review, 35(3), 315-336. DOI: 10.1111\/dpr.12210.\n<\/span><\/span> cconclude from their review of the published evidence that benefits from internet investments are favoring advanced economies, while their contribution for the fight against poverty in less developed regions remain uncertain.<\/p>\n\n\n\n

There are indications that the use of mobile phones by micro and small enterprises have increased the well-being of the micro-entrepreneurs mainly due to greater price transparency and a reduction of waste [17]<\/a>17 \u2014 Donner, J.; Escobari, M. X. (2010). A review of evidence on mobile use by micro and small enterprises in developing countries. Journal of International Development, 22(5), 641-658.\n<\/span><\/span>. In the context of entrepreneurship, mobiles phones help doing business by supporting communication in various ways: easing access to market information, getting paid through mobile payment solutions, reaching new customers and widening the geographical area, where products can be sold [18]<\/a>18 \u2014 See:\n\nAker, J.; Mbiti, I. (2010). Mobile phones and economic development in Africa. Journal of Economic Perspectives, 24(3), 207-232.\nChew, H. E.; Ilavarasan, V. P.; Levy, M. R. (2013). Mattering matters: Agency, empowerment, and mobile phone use by female microentrepreneurs. Information Technology for Development. DOI:10.1080\/02681102.2013.839437.\nDonner, J.; Escobari, M. X. (2010). A review of evidence on mobile use by micro and small enterprises in developing countries. Journal of International Development, 22(5), 641-658.\nWest, D. M. (2012). How mobile technology is driving global entrepreneurship. Brookings Policy Report.\n\n<\/span><\/span>. Furthermore, there is scientific evidence that mobile phones, as one specific information and communication technology, can empower women, for example by enabling their economic activity [19]<\/a>19 \u2014 Chew, H. E.; Ilavarasan, V. P.; Levy, M. R. (2013). Mattering matters: Agency, empowerment, and mobile phone use by female microentrepreneurs. Information Technology for Development. DOI:10.1080\/02681102.2013.839437.\n<\/span><\/span>.<\/p>\n\n\n\n

However, structural changes, such as patriarchal social hierarchies or the status of women in their community, are not necessarily triggered by the use of this technology [20]<\/a>20 \u2014 Oreglia, E.; Srinivasan, J. (2016). ICT, intermediaries and the transformation of gendered power structures. MIS Quarterly, 40(2), 501-510.\n<\/span><\/span>. On a similar notion, Gillard et al. [21]<\/a>21 \u2014 Gillard, H.; Howcroft, D.; Mitev, N.; Richardson, H. (2008). \u201cMissing women\u201d: Gender, ICTs and the shaping of the global economy. Information Technology for Development, 14(4), 262-279.\n<\/span><\/span> argue that solving existing gender issues should be seen as a key topic in international development, as women are the key actors in a number of crucial areas, such as education, health, agriculture, and commerce, where digital technologies can make a difference. Baack [22]<\/a>22 \u2014 Baack, S. (2015). Datafication and empowerment: How the open data movement re-articulates notions of democracy, participation, and journalism. Big Data & Society, juliol-desembre, 1-11.\n<\/span><\/span> uggests to take advantage of the open data approach to support participation, empowerment but also more fundamentally democratic values. Digital social media platforms do generate a lot of digital data. However, even though they may contribute to development in the sense of providing opportunities for some individuals to earn a living or for companies to promote their products they also come with a number of potential risks, such as hate speech or cyber-bullying [23]<\/a>23 \u2014 Nicholson, B.; Nugroho, Y.; Rangaswamy, N. (2016). Social media for development: Outlining debates, theory and praxis. Information Technology for Development, 22(3), 357-363.\n<\/span><\/span>. This is, of course true, for both, developed and developing countries.<\/p>\n\n\n\n

As much as there is an agreement among most scholars in this field that some digital technologies and services have the capacity to improve inclusion and enhance equitable economic opportunities, there is major concern that the opportunities are not seized or even contracted due to economic power, governance failures and the neglect of other contextual factors such as regional cultural and social circumstances. Along that line, Walsham et al. [24]<\/a>24 \u2014 Walsham, G.; Symons, V.; Waema, T. (1990). Information systems as social systems: Implications for developing countries. A: Bhatnagar, S. C.; Bj\u00f8rn-Andersen, N. (eds.). Information technology in developing countries (p. 51-61). Amsterdam: North Holland.\n<\/span><\/span> rgue that digital information systems need to be conceptualized as social systems, where technology should be regarded as only one of several dimensions. Even though many opportunities due to the application of digital technologies are mentioned in the literature for SMEs, Ahmad et al. [25]<\/a>25 \u2014 Ahmad, S. Z.; Bakar, A. R. A.; Faziharudean, T. M.; Zaki, K. A. M. (2015). An Empirical Study of Factors Affecting e-Commerce Adoption among Small- and Medium-Sized Enterprises in a Developing Country: Evidence from Malaysia. Information Technology for Development, 21:4, 555-572. DOI: 10.1080\/02681102.2014.899961.\n<\/span><\/span> aargue that many from those which have adopted e-commerce have not managed to move beyond the entry-level partly because difficulties have arisen due to continuously advancing technology requirements and the high cost associated with necessary infrastructure.<\/p>\n\n\n\n

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Structural changes, such as patriarchal social hierarchies or the status of women in their community, are not necessarily triggered by the use of mobile phones<\/p><\/blockquote>\n<\/div>\n\n\n\n

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Providing access to all interested parties may conflict with market domination policies by powerful companies, creating special services for the poor may not be pursued by governments or administrative bodies and opening channels for engagement may not serve those who lack the education to seize these opportunities. At this point, the balance between opportunities and risks for equity and inclusion is still contested in the literature and it may depend on the local conditions whether the full potential of digital technologies and services has been or will be realized. As a means to study the evolving patterns of digital capacity building and use scholars need to recur to transdisciplinary approaches, that promise to integrate the perspectives, habits and requirements of non-academic and non-technological experts from the region where the technology is supposed to be rolled out [26]<\/a>26 \u2014 Lyytinen, K.; Nambisan, S.; Yoo, Y. (2020). A transdisciplinary research agenda for digital innovation: key themes and directions for future research. A: Handbook of Digital Innovation. Edward Elgar Publishing.\n<\/span><\/span>.<\/p>\n<\/div>\n<\/div>\n\n\n\n

Digitalization and employment<\/em><\/h6>\n\n\n\n

There are some indications that a digitalized manufacturing industry is less likely to booster employment in low-income countries [27]<\/a>27 \u2014 Ugur, M.; Mitra, A. (2017). Technology Adoption and Employment in Less Developed Countries: A Mixed-Method Systematic Review. A: World Development (vol. 96, p. 1-18). Elsevier BV. Available online.\n<\/span><\/span>. Several studies suggest that a digitally interconnected production is likely to raise skill requirements for workers [28]<\/a>28 \u2014 See:\n\nArntz, M.; Gregory, T.; Zierahn, U. (2016). \u201cThe Risk of Automation for Jobs in OECD Countries: A Comparative Analysis\u201d, OECD Social, Employment and Migration Working Papers, n\u00fam. 189, OECD Publishing, Par\u00eds.\nBeier, G.; Niehoff, S.; Ziems, T.; Xue, B. (2017). Sustainability aspects of a digitalized industry \u2013 A comparative study from China and Germany. Int. J. of Precis. Eng. and Manuf.-Green Tech. 4, 227-234. Available online.\n\n<\/span><\/span>. Therefore, low paying locations might struggle to compete internationally with other better paying countries to attract qualified personnel for their industrial production. From a structural perspective, Matthess & Kunkel [3]<\/a>3 \u2014 Fritzsche, K.; Kunkel, S.; Matthess, M. (2020). Digitalized economies in Africa. Structural change in a dynamic environment. IASS Fact Sheet, 2\/2020.\n<\/span><\/span> also warn that \u201cthe skill bias of digital technologies may be a risk not only for equitable income gains, but also for inter-firm linkages\u201d. With regard to the integration of smaller companies from developing countries into global value chains, Foster et al. [29]<\/a>29 \u2014 Foster, C.; Graham, M.; Mann, L.; Waema, T.; Friederici, N. (2018). Digital Control in Value Chains: Challenges of Connectivity for East African Firms, Economic Geography, 94:1, 68-86, DOI: 10.1080\/00130095.2017.1350104.\n<\/span><\/span> identify shifting modes of value chain governance and data standards as new challenges to digitally integrate.<\/p>\n\n\n\n

Digitalization and sustainability<\/h5>\n\n\n\n

The overarching goal of sustainable development is a guiding principle for assessing and evaluating the impacts of digital technology and services. It is essential that all three dimensions of sustainability \u2013 the ecological, the economic, and the social \u2013 are taken into consideration and analysed in terms of their implications for development [30]<\/a>30 \u2014 Renn, O.; Beier, G.; Schweizer, P. J. (2021). The opportunities and risks of digitalisation for sustainable development: a systemic perspective. GAIA-Ecological Perspectives for Science and Society, 30(1), 23-28.\n<\/span><\/span>.<\/p>\n\n\n\n

The ecological dimension<\/em><\/h6>\n\n\n\n

The three main objectives of ecological sustainability are decarbonization, dematerialization and renaturalization [31]<\/a>31 \u2014 See:\n\nGraedel, T.E.; Lifset, R.J. (2016). Industrial ecology\u2019s first decade. A: Clift, R.; Druckman, A. (eds.). Taking Stock of Industrial Ecology. Cham: Springer. DOI: 10.1007\/978-3-319-20571-7.\nRenn, O.; Beier, G.; Schweizer, P. J. (2021). The opportunities and risks of digitalisation for sustainable development: a systemic perspective. GAIA-Ecological Perspectives for Science and Society, 30(1), 23-28.\n\n<\/span><\/span>. Digitalization offers ample opportunities to fulfil these three ecological goals. Digital platforms can provide communications and coordination services with a smaller carbon footprint in terms of mobility, material consumption, and land use. The substitution of energy and materials with information is one of the major promises for reducing human footprint on the environment. These opportunities are valid for developed as well as developing countries.<\/p>\n\n\n\n

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Digitalization also brings about substantial risks due to the growing number of devices and the increasing use of streaming and cloud services, the energy consumption of digital services and applications continues to rise<\/p><\/blockquote>\n<\/div>\n\n\n\n

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But digitalization also brings about substantial risks for ecological sustainability. Due mainly to the growing number of devices and the increasing use of streaming and cloud services, the energy consumption of digital services and applications continues to rise [32]<\/a>32 \u2014 Andrae, A. (2019). Comparison of several simplistic high-level approaches for estimating the global energy and electricity use of ICT networks and data centers. Int. J. Green Technol. 5 (1), 50-63. Available online.\n<\/span><\/span>. This cancels out many of the energy savings made, for example, by substituting travel. Studies show that while modernizing production processes in accordance with Industry 4.0 is thought to lead to efficiency gains, in many cases no significant reduction in material and energy consumption can be demonstrated [33]<\/a>33 \u2014 Fritzsche, K.; Niehoff, S.; Beier, G. (2018). Industry 4.0 and climate change\u2014Exploring the science-policy gap. Sustainability, 10 (12), 4511. Available online.\n<\/span><\/span>. This is particularly true for developing countries where digitalization may not replace more energy intensive production but builds up new businesses and services. More clarity about the effects of Industry 4.0 technology use can probably only be gained through a longer-term evaluation.<\/p>\n<\/div>\n<\/div>\n\n\n\n

The economic dimension<\/em><\/h6>\n\n\n\n

The economic dimensions of sustainability include: fostering the circular economy; ensuring long-term, socially protected employment; and preserving an economic system that is open, innovative, and competitive [34]<\/a>34 \u2014 See:\n\nSchr\u00f6der, P.; Lemille, A.; Desmond, P. (2020). Making the circular economy work for human development. Resources, Conservation and Recycling, 156. Available online.\nRenn, O.; Beier, G.; Schweizer, P. J. (2021). The opportunities and risks of digitalisation for sustainable development: a systemic perspective. GAIA-Ecological Perspectives for Science and Society, 30(1), 23-28.\n\n<\/span><\/span>. A future circular economy requires the combination with a broad variety of digital services. Circular economy has the potential to capitalise upon emerging digital technologies, such as big data, artificial intelligence, blockchain and the Internet of things [35]<\/a>35 \u2014 Chauhan, C.; Parida, V.; Dhir, A. (2022). Linking circular economy and digitalisation technologies: A systematic literature review of past achievements and future promises, Technological Forecasting and Social Change, vol. 177, 121508, DOI: 10.1016\/j.techfore.2022.121508.\n<\/span><\/span>. These digital solutions and enhancing services will require comprehensive digital product identification, and compatible data standards covering the entire product lifecycle. Additionally, product-service systems are considered an essential business model innovation for achieving circular economy through digital means [35]<\/a>35 \u2014 Chauhan, C.; Parida, V.; Dhir, A. (2022). Linking circular economy and digitalisation technologies: A systematic literature review of past achievements and future promises, Technological Forecasting and Social Change, vol. 177, 121508, DOI: 10.1016\/j.techfore.2022.121508.\n<\/span><\/span>. These are only two of several examples where digitalization has the potential to modify existing or create entirely new value chains. According to estimates, the global ICT sector grew from USD\u202f1.3 trillion (1012<\/sup>) in 1992 to USD 3.9 trillion in 2014 and currently accounts for 4.5% of global GDP [36]<\/a>36 \u2014 Selvam, M.; Kalyanasundaram, P. (2015). Global IT\/IT enabled services and ICT industry: Growth & determinants. A: Proceedings of the International Symposium on Emerging Trends in Social Science Research. Chennai-India.\n<\/span><\/span>. However, this growth is unequally distributed among the world\u2019s nations as indicated above. In how far the Global South will benefit from this service is still highly contested.<\/p>\n\n\n\n

In terms of innovation and the creation of employment, digital services and applications can help developing countries to establish innovative industries and new start-ups. But the reality of the ICT sector still lags far behind this ideal, in particular in developing countries. The quick replacement of devices (particularly smartphones) and at least an indirect encouragement of a throwaway mentality runs counter to the objectives of circular economy and recycling.<\/p>\n\n\n\n

The social dimension<\/em><\/h6>\n\n\n\n

Three objectives can be identified in the context of the social dimension of sustainability: (i) equitable living conditions (intra- and intergenerational justice), (ii) sovereignty and active participation as well as (iii) social and cultural identification with the transformations and developmental pace [37]<\/a>37 \u2014 See:\n\nWeing\u00e4rtner, C.; Moberg, A. (2011). Exploring social sustainability: Learning from perspectives on urban development and companies and products. Sustainable Development, 22 (2), 122-133.\nRenn, O.; Beier, G.; Schweizer, P. J. (2021). The opportunities and risks of digitalisation for sustainable development: a systemic perspective. GAIA-Ecological Perspectives for Science and Society, 30(1), 23-28.\n\n<\/span><\/span>.<\/p>\n\n\n\n

While the fears of the 1990s that digitalization would lead to a digital divide within society, the problem now is that digital divide is particularly prevalent between countries. There is clear evidence that certain regions in the Global South are disadvantaged when it comes to using digital technologies or services [38]<\/a>38 \u2014 See:\n\nVan Dijk, J. (2020). The digital divide. New York: John Wiley & Sons.\nYoon, H.; Kim, S.; Kim, J. (2018). Trends of digital divide among older adults 2011-2016. Innovation in Aging, 2 (supl. 1), 694. Available online.\n\n<\/span><\/span>. Inequities start with a lack of access to fast internet connections and end with insufficient digital literacy. Furthermore, many digital technologies come along with an acclaimed digital lifestyle that often appears to be alien to the economic or social culture of many countries.<\/p>\n\n\n\n

Policy implications<\/h5>\n\n\n\n

In many countries governments and state agencies consider the ongoing digital transformation as a big opportunity for socio-economic development. In developing countries digitalization is often viewed as a driver for growth and job creation as well as an enabler of a more environmentally friendly industrial development [3]<\/a>3 \u2014 Fritzsche, K.; Kunkel, S.; Matthess, M. (2020). Digitalized economies in Africa. Structural change in a dynamic environment. IASS Fact Sheet, 2\/2020.\n<\/span><\/span>. Many governments and state agencies in those countries have developed policies and programmes to foster the emergence of knowledge-based economies. Promoting education and research, supporting the creation of innovative businesses, and upgrading electricity and telecommunication infrastructures have been preferred means for that purpose. Since the early 2000s approaches of this kind have increasingly tried to support and focus on the use of digital technologies [3]<\/a>3 \u2014 Fritzsche, K.; Kunkel, S.; Matthess, M. (2020). Digitalized economies in Africa. Structural change in a dynamic environment. IASS Fact Sheet, 2\/2020.\n<\/span><\/span>. Especially in China, the digital transformation is seen as a key driver and enabler for economic development and is supported by key policies such as the \u201cMade in China 2025\u201d strategy.<\/p>\n\n\n\n

One of the big challenges in this transformation process is to design the according policies in a way that they support inclusion, while not aggravating the already existing digital and social divides through these measures. For that purpose, the core strategy of the African Union for the socio-economic transformation of the continent, the Agenda 2063, emphasizes the importance of science, technology, innovation but also explicitly education together with an expansion of digital infrastructures for the industrial development of the continent (explicitly including the strengthening of digital services). Based on the approaches presented in Section 2, the demand can be derived that inclusion should be given much greater priority in the future as a higher-level socio-economic goal of all policies aimed at digitalization, both at global and national level.<\/p>\n\n\n\n

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Inclusion should be given much greater priority in the future as a higher-level socio-economic goal of all policies aimed at digitalization, both at global and national level<\/p><\/blockquote>\n<\/div>\n\n\n\n

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When it comes to integrating the concepts of international development and sustainability within policies, consideration is also given to the concept of sustainable development as a more future-oriented vision [39]<\/a>39 \u2014 Qureshi, S. (2015). Are we making a Better World with Information and Communication Technology for Development (ICT4D) Research? Findings from the Field and Theory Building, Information Technology for Development, 21:4, 511-522, DOI: 10.1080\/02681102.2015.1080428.\n<\/span><\/span>. Therefore, all policies striving to combine these two concepts should take the UN Sustainable Development Goals (SDGs) as their guiding orientation, to ensure that the intended socio-economic development is not only forward-looking, but also geared towards the well-being of people and the environment.<\/p>\n<\/div>\n<\/div>\n\n\n\n

Conclusions<\/h5>\n\n\n\n

We are in the midst of two global transformations happening in parallel: the digital transformation and the transformation towards more sustainable development. One of the major challenges in shaping these transformations will be to narrow down the digital divide between the Global North and the Global South. Following the patterns of traditional industrialization pathways might economically not be a wise choice for many developing countries in this regard.<\/p>\n\n\n\n

The research on ICT for development has suggested different approaches to tackle issues like systemic poverty or economic exclusion. Nonetheless, Harris [40]<\/a>40 \u2014 Harris, R. W. (2015). How ICT4D Research Fails the Poor. Information Technology for Development. DOI: 10.1080\/02681102.2015.1018115.\n<\/span><\/span>, states that research on ICT for development has failed the poor in the past, mainly because it is not sufficiently engaging to advance policies, it is often disconnected from real-world problems and is cursed by the need to publish its results. A similar criticism is also articulated with regard to overly simplistic analyses, which oftentimes focus solely on whether people have ICT access or not – instead a more complex ICT impact chain should be analyzed including communication capabilities, information literacy, and knowledge sharing abilities [41]<\/a>41 \u2014 Gigler, B.-S. (2015). Development as freedom in a digital age. Washington, DC: World Bank.\n<\/span><\/span>.<\/p>\n\n\n\n

Many governments in developing countries see a lot of potential for socio-economic development in taking advantage of digital technologies [3]<\/a>3 \u2014 Fritzsche, K.; Kunkel, S.; Matthess, M. (2020). Digitalized economies in Africa. Structural change in a dynamic environment. IASS Fact Sheet, 2\/2020.\n<\/span><\/span> and have therefore increased their efforts to enhance digital skills and the required infrastructures for this transformation. Establishing a vital digital economy needs to come along with enabling framework conditions which strengthen \u2018digital skills\u2019; but also provide supporting \u2018policies and regulations\u2019 encouraging the development of innovative digital hard- and software solutions as well as digital business models [42]<\/a>42 \u2014 Banga, K.; Te Velde, D. W. (2018). Digitalisation and the future of manufacturing in Africa. Available online. Consultation date: 6\/1\/2022.\n<\/span><\/span>. Efforts were increased in many countries in the Global South to develop and produce ICT products and components, such as the first African smartphone Maraphone or the South-African original equipment manufacturer CZ Electronics, whose portfolio focusses on consumer electronics. Other countries see the formation of digital platforms such as Jumia (by the African Internet Group) a start-up from Nigeria, which has turned into a major e-commerce platform in sub-Saharan Africa [43]<\/a>43 \u2014 Thomas, D. (2019). Alibaba tests water with e-commerce initiatives. A: African Business, 11\/12\/2019. Available online. Consultation date: 6\/1\/2022.\n<\/span><\/span>. However, policymaking will need to find a good balance between economic development, technological progress and the generation of employment opportunities to ensure this transformation will eventually be of an inclusive nature.<\/p>\n\n\n\n

There are concerns that digitalization may lead to a reduced convergence in international cooperation. To reduce this effect and to achieve inclusion, skill development in low-income countries will be absolutely essential [42]<\/a>42 \u2014 Banga, K.; Te Velde, D. W. (2018). Digitalisation and the future of manufacturing in Africa. Available online. Consultation date: 6\/1\/2022.\n<\/span><\/span>. In addition, it must be ensured internationally that market entry and assertion remain viable even though the market is dominated by few major players. As a consequence, the investment climate should be improved, e.\u202fg. through direct financing opportunities and participation in global value chains (GVCs) [42]<\/a>42 \u2014 Banga, K.; Te Velde, D. W. (2018). Digitalisation and the future of manufacturing in Africa. Available online. Consultation date: 6\/1\/2022.\n<\/span><\/span>. A similar challenge, especially for enterprises from rural and remote areas, is the affordability and accessibility of the digital platform services for e-commerce [11]<\/a>11 \u2014 Haji, K. (2021). E-commerce development in rural and remote areas of BRICS countries, Journal of Integrative Agriculture, vol. 20, n\u00fam. 4, p. 979-997. DOI: 10.1016\/S2095-3119(20)63451-7.\n<\/span><\/span>. o address these challenges support should be provided for digital infrastructure projects as well as important empowering areas such as education, research and innovation hubs.<\/p>\n\n\n\n

Future research needs to tackle these issues and needs to clarify which technology-, and sector-specific interactions will lead to beneficial linkages between processes of structural change and digitalization in countries of the Global South [44]<\/a>44 \u2014 Matthess, M.; Kunkel, S. (2020). Structural change and digitalization in developing countries: Conceptually linking the two transformations. Technology in Society (Vol. 63, p. 101428). Elsevier BV. Available online.\n<\/span><\/span>. But most importantly, the ongoing digital transformation has to be shaped in a way that digital technologies support the improvement of education, health systems and livelihoods while also contributing to a more environmentally sustainable and inclusive way of living.<\/p>\n","protected":false},"excerpt":{"rendered":"

According to Heeks , digital technologies have impacted international development in three particular ways: they now reach almost all low-income communities, both in urban and rural contexts (reach), they are relevant to almost all development issues and sectors (scope), and they play a vital role in all aspects of development processes (depth). Given the changing patterns in the field of international development these three impact dimensions can be associated with the major challenges: transformation (incremental developmental changes are no longer sufficient), inclusion (decision making beyond elite circles), and sustainability (development within the remits of planetary boundaries) . Digital technologies have\u2026<\/p>\n","protected":false},"author":37,"featured_media":55460,"parent":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[406],"tags":[],"segment":[],"subject":[],"class_list":["post-55551","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-el-sistema-de-cooperacio-enfront-l-evolucio-de-l-ordre-mundial-i-els-reptes-globals-en"],"acf":[],"yoast_head":"\nRisks and opportunities of the digital transformation – IDEES<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/revistaidees.cat\/en\/risks-and-opportunities-of-the-digital-transformation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Risks and opportunities of the digital transformation – IDEES\" \/>\n<meta property=\"og:description\" content=\"According to Heeks , digital technologies have impacted international development in three particular ways: they now reach almost all low-income communities, both in urban and rural contexts (reach), they are relevant to almost all development issues and sectors (scope), and they play a vital role in all aspects of development processes (depth). 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