Good morning. It is my great pleasure to speak to all of you today about how the World Bank is now taking center stage to meet today¡¯s digital moment. Let¡¯s build on the incredible momentum of the last day and a half!
We have brought together some of the world¡¯s greatest minds and leaders on digitalization, not to ¡°talk¡± about digital development but to really advance the conversation and move to a new era, one of digital for all.
Together we must define the next steps so that developing countries can reap the benefits of digitalization. What is needed to mitigate the risks, accelerate investments and implement policy reforms, so that working together we can close the digital divide.
Because it¡¯s very clear that we need to rethink development for the digital era.
Embracing digitalization is no longer a choice. It¡¯s a necessity. The critical services that support development¡ªlike hospitals, schools, energy infrastructure, and agriculture¡ªall run on connectivity and data.
Without access to the internet and the skills to use digital technologies effectively, too many people are essentially locked out of the modern world.
A new digital era that is accessible to all holds the potential to shape a more inclusive, resilient, and sustainable world for generations to come.
The data is undeniable. Digital tools drive growth, jobs and sustainability. When fast internet becomes available, the probability that a person is employed increases by up to 13 percent, total employment per firm increases by up to 22 percent, and firm exports nearly quadruple. For example, faster internet coverage reduced extreme poverty in Senegal by 10 percent. And digital technologies can reduce emissions by up to 20 percent in the top emitting sectors.
The new World Bank Digital Progress and Trends report shares new data and insights on the potential of digital tools to accelerate development.
Let¡¯s take a look at some of the eye-opening findings:
The IT services sector (from tech consulting to software development) alone grew twice as fast as the rest of the economy over the past two decades, creating jobs at six times the rate of the global economy.
And while high-income countries have doubled their use of tech to speed along industry growth, unfortunately this is not the case in developing countries, the digital divide remains stark. One-third of the global population remains offline. While some regions ¨C like South Asia, Europe and Central Asia ¨C have increasing internet use, there is still a significant lag. In East Africa, for example, less than 30 percent of people use the internet.
And even when access is available, mobile phones are too expensive in low-income countries. Even the cheapest smartphone can cost over 60% of the average monthly income in many poor countries.
So this leads me to the question of how we can make internet more accessible and affordable in developing countries? An important part of the solution is digital infrastructure, which needs more investment.
Lack of sufficient digital infrastructure is holding back developing countries¡¯ ability to handle the explosive growth in data and artificial intelligence. Take data centers, which are crucial for processing data and enabling artificial intelligence. In 2022, high-income countries accounted for three-quarters of connected data centers.
Africa has just 2% of the world¡¯s data center capacity ¨C for at least 17% of the global population. Africa cannot thrive in the age of artificial intelligence (AI) with 2% of the world¡¯s datacenter capacity for 17% of the global population. Put another way, for one data center in Africa, there are at least 100 in OECD countries. We also have to keep in mind here the necessary infrastructure to support data centers ¨C energy access being one. The reduction of the digital gap is intrinsically linked to energy access, to infrastructure development, regulations. We will have to work on all those aspects to make a difference ¨C and this means, public and private sector together.
Digitalization is helping the poorest countries leapfrog ahead in their development. During this year of IDA replenishment, these results are key to drive support. We are supporting this agenda in many different countries. But the common challenge we are facing is how we can scale these measurements, how can we make this available to the vast majority of the population
We cannot do it alone. So while an ambitious IDA replenishment ¨C and well-resourced IDA can help close the digital divide ¨C it is not sufficient. And while our diagnostic work clearly shows the gap, our actions now need to focus on how to accelerate digitalization in developing countries. And that requires a couple of important things:
¡¤ Policy and regulatory work
¡¤ More investments in enabling infrastructure including areas like energy ¨C and here we need greater private sector mobilization.
¡¤ And to coordinate all of these actions, we need to avoid a cacophony of frameworks and approaches. We need to look at standardizing frameworks. Making them simple. And accessible.
¡¤ And finally, we need AMBITION. The data shows that the gap is widening. It can wide even further with AI. This should concern all of us. And this should prompt the move for better partnerships, including with the private sector, and more action.
We want to work with all of you for a more inclusive world and convergence rather than divergence. This should be our common challenge.
As you might have heard Ajay say in yesterday¡¯s opening session, these trends are being discussed widely within the Bank Group ¨C and we are placing such importance on the role of digital that we have decided to create a new Digital Vice Presidency Unit. The focus of this unit is not only to consolidate all of the digital work we are doing across the Bank, but also to give it a much sharper focus. We want to capture, with agility and speed, digital trends and learning ¨C and see how we can best translate these into new programs and impactful support to development.
This is an exciting new area ¨C and this new unit can only be successful in cooperation with the countries, with the private sector, with partners who are committed to helping close the digital divide.
There is an urgency to this agenda ¨C and we need to be single mindedly focused on narrowing this gap ¨C using scale, our new structure, and partners to work together.
This summit demonstrates what is possible when we work together. It shows the benefit of capturing trends and new developments, sharing learnings and ideas between the Bank, experts in the digital space, countries, and the private sector.
Together we can explore ways to advance this important agenda, while being always aware of the negative trends in this space. We are embracing digital acceleration in a thoughtful way, taking all of the opportunities and navigating the risks.
This is an exciting dialogue and a chance to stimulate a long-overdue debate within this organization, gaining outside perspective on how we best can contribute to moving impactful investments and best supporting the countries we serve. That should be the guiding light in all that we are doing. We need to act with urgency, with scale, and with ambition. Working together, discussing real options and opportunities, strengthening partnerships and dialogue so that together we can accelerate digitalization and a new, digital for all, era of development.
Thank you!
