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5 ways digitalization can help build global resilience in 2023

Smart phone suspended in the air with camera capture open on building: Digitalization could enable $100 trillion of additional value for the world economy by 2025.

Digitalization could enable $100 trillion of additional value for the world economy by 2025. Image: Unsplash/Yiran Ding

Börje Ekholm
President and Chief Executive Officer, Ericsson
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Tech and Innovation

This article is part of: World Economic Forum Annual Meeting

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  • Digitalization is fundamental to facing the world’s biggest challenges, which depend on connectivity and digital skills, yet, connectivity inequality still exists.
  • Among other key factors, digitalization can increase national resilience by bridging the digital divide for better economic growth and social inclusion.
  • A paradigm shift in connectivity is taking place, evident through the rapid scaling of 5G, forecasted to reach 5 billion by the end of 2028, according to the latest Ericsson Mobility Report.

Ericsson was founded on the premise that communication is a basic human need. Yet, today’s biggest inequality may be between the connected and unconnected.

While we need to harness the power of digitalization to face a series of fundamental challenges – economic slowdowns, energy crises and a changing climate – connectivity is a foundation for digitalization, as are the skills to use digital tools.

Around the world, mobile networks play a crucial role in providing connectivity, with more than 6 billion subscribers on mobile networks today – more than the number of toothbrushes.

Let’s look at five areas in which digitalization can encourage the resilience we’ll need in 2023.

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1. Improved networks and coverage

Connectivity is a cornerstone for national resilience. The emergency services, health care and education are a testament to that.

If the COVID-19 pandemic had happened in 2000, only 6.7% of the world would have had internet access. Can you imagine the absolute standstill our society and economy would have encountered without remote working and education?

With 5G and other modern networks, wireless connectivity can finally be the primary choice of access to technology. The long-range, high bandwidth and low latency of 5G can connect even the most remote regions with cutting-edge opportunities.

2. Economic value unlocked

Just as electrification transformed the 20th century, digitalization will reform the 21st century. Research shows that digital transformation could enable $100 trillion of additional value for the world economy by 2025.

A new Ericsson-commissioned study from consulting firm Analysis Mason highlights the potential economic, consumer and environmental benefits of 5G connectivity. The study focused on 15 national emerging markets and showed that 5G rollout would generate overall economic benefits, i.e. an increase in global domestic product, three-to-seven times higher than the incremental cost of extending coverage.

3. Enterprise productivity

How can an enterprise thrive in the face of rising energy prices, uncertain supply chains and natural disasters?

A new Ericsson ConsumerLab report on enterprises rethinking resilience found that 90% of companies with a well-defined resilience strategy invest in digitalization and automation. That’s 50% higher than those without a strategy.

Plotting the five paths to resilience based on their respective average digitalization level and sustainability maturity. Image: Ericsson

4. Solutions to boost climate action

Digital transformation is a key tool to address climate change. Ericsson’s research has found that ICT solutions can help reduce global greenhouse gas emissions by up to 15% by 2030 while responsible for only 1.4% of the global carbon footprint. That reduction can go even further with emerging technologies such as 5G, artificial intelligence and the internet of things.

The 5G network, with its ultra-low latency and high speed, stands out as it can potentially digitalize industries at scale – a topic explored in depth in the MIT Technology Review Insights white paper.

Discover

How can digital technologies help deliver the climate goals?

5. Bridging the digital divide

About 2.7 billion people still lack access to the internet. It’s not for lack of coverage; in fact, more than a third of the world’s population remains offline despite 95% living within range of some form of connectivity. Instead, affordability and lack of digital skills are major barriers.

At Ericsson, we have been particularly active in connecting schools and building digital skills to ensure that young people can participate in the 21st-century economy.

Another important area is financial inclusion. Nearly a quarter of the world’s adult population lacks access to formal banking and financial services, according to the World Bank Findex 2021 database. A majority of these unbanked people do, however, own a mobile phone.

Mobile financial services offer the possibility to bring millions into the formal economy. For example, the Ericsson Mobile Financial Services (MFS) platform currently has over 360 million active wallets in more than 15 countries, boosting individual livelihoods and transforming economies.

Connectivity evolution

We are in the middle of a paradigm shift in connectivity.

You can see this change clearly with 5G, scaling faster than any previous mobile generation. According to our latest Ericsson Mobility Report, global 5G subscriptions will have topped 1 billion by the end of 2022 and 5 billion by the end of 2028, despite global economic challenges.

Digital transformation is a global engine to build dynamic, sustainable, innovative economies that deliver inclusive growth. But success will require a collective effort.

While 2023 presents stark challenges, I’m confident we’re up to creating a sustainable and resilient society for all.

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The views expressed in this article are those of the author alone and not the World Economic Forum.

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World Economic Forum

May 21, 2024

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