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· The digital world is facing a crisis with slowing internet growth and declining levels of trust that urgently need to be addressed
· 60% of global GDP is expected to be digitized by 2022, with very little distinction between the digital economy and the economy, or between digital society and society
· The Forum highlights six priority areas for action: Access and adoption, identity, positive societal impact, security, governance, and data
· Read the full report here
Geneva / San Jose / Tokyo, 10 December 2018 – Building a digital economy and society that is trusted, inclusive and sustainable requires urgent attention in six priority areas according to a new report, Our Shared Digital Future, published by the World Economic Forum today.
The report represents a collaborative effort by business, government and civil society leaders, experts and practitioners. It follows an 18-month dialogue aimed at restoring the internet’s capacity for delivering positive social and economic development.
The report comes at a historic moment on the day when, for the first time, more than one-half of the world’s population is now connected to the internet. At the same time, less than one-half of those already online trust that technology will make their lives better.
With 60% of the global economy forecast to be digitized by 2022, there remains huge potential for the Fourth Industrial Revolution to lift more people out of poverty and strengthen societies and communities. However, success depends on effective collaboration between all stakeholder groups. The authors, in addition to unveiling six key areas for action, also highlight several existing efforts at global and local levels where collaboration is helping to restore trust and deliver broad-based societal benefits.
The six priority areas for multistakeholder collaboration are:
Internet access and adoption
Internet access growth has slowed from 19% in 2007 to 6% in 2017. At the same time, we have reached the milestone of 50% of the world’s population being connected to the internet. To close the digital divide, more investment is needed to not only provide access, but also improve adoption.
By 2020, the average internet user will have more than 200 online accounts and by 2022, 150 million people are forecast to have blockchain-based digital identities. However, 1 billion people currently lack a formal identity, which excludes them from the growing digital economy. Good digital identity solutions are key to addressing this divide, empowering individuals, and protecting their rights in society.
Positive impact on society
By 2022, an estimated 60% of global GDP will be digitized. In 2018, companies are expected to spend more than $1.2 trillion on digital transformation efforts. Yet, only 45% of the world’s population feel that technology will improve their lives. Companies need to navigate digital disruption and develop new responsible business models and practices.
Cyberattacks result in annual losses of up to $400 billion to the global economy. More than 4.5 billion records were compromised by malicious actors in the first half of 2018, up from 2.7 billion records for the whole of 2017. A safe and secure digital environment requires global norms and practices to mitigate cyber-risks.
Governance of the Fourth Industrial Revolution
Policy-makers and traditional governance models are being challenged by the sheer magnitude and speed of the technological changes of the Fourth Industrial Revolution. Developing new and participatory governance mechanisms to complement traditional policy and regulation is essential to ensure widespread benefits, close the digital divide and address the global nature of these developments.
The amount of data that keeps the digital economy flowing is growing exponentially. By 2020, there will be more than 20 billion connected devices globally. Yet there is no consensus on whether data is a type of new currency for companies to trade or a common public good that needs stricter rules and protection. The digital economy and society must bridge this gap by developing innovations that allow society to benefit from data while protecting privacy, innovation and criminal justice.
“The digital environment is like our natural environment,” said Derek O’Halloran, Head, Future of Digital Economy and Society, the World Economic Forum. “We all – governments, businesses, individuals – have a duty to ensure it remains clean, safe and healthy. This paper marks a step forward in offering a blueprint for a better internet we can all work towards: One that is inclusive, trustworthy and sustainable.”
The report is part of ongoing work by the World Economic Forum to provide a platform to accelerate, amplify or catalyse collaborative efforts from business, government, academia and civil society to advance progress towards an inclusive, trustworthy and sustainable digital economy. The report provides an overview of key issues for the digital economy and society, establishes priorities for multistakeholder collaboration for the year ahead, and highlights existing key initiatives and resources.
“Our existing institutions, mechanisms and models are struggling to effectively respond to the pace of digital change and its distributed nature. This report identifies critical areas of focus for public-private partnerships to help restore trust in an inclusive and prosperous digital future,” said Jim Smith, Chief Executive Officer, Thomson Reuters and Co-Chair, World Economic Forum System Initiative on Shaping the Future of Digital Economy and Society.
"While recognizing that digital developments fuel many opportunities in political, commercial and social spheres, a key point of this paper is the need to focus on inclusion and addressing digital divides; only through incorporating more voices and views – in the development of political and commercial policies – will we be able to create a society that truly benefits all,” said Lynn St. Amour, Chair of the UN Internet Governance Forum (IGF)’s Multistakeholder Advisory Group, and Co-Chair, World Economic Forum System Initiative on Shaping the Future of Digital Economy and Society.
“It is imperative that we bring broadband to all those who are not yet connected –and fast. In parallel, the technology, business and regulatory ecosystems must all be aligned in order to accelerate adoption of the “Industrial Internet” and deliver the benefits of digital automation to a wide range of enterprises. This, done right, can provide an immense productivity boost to economies.” Rajeev Suri, President and Chief Executive Officer, Nokia
“It is time we retire the term ‘digital economy.’ There is only one economy which is digitizing at varying speed. Therefore, special regulatory regimes for digital businesses don’t make sense. We must develop agile and consistent policies that apply to all actors in a changed market reality where technology and data are omnipresent.” Gillian Tans, Chief Executive Officer, Booking.com
“We need to maximize the benefits of digitalization to create an inclusive economy, close the inequality gap and improve income distribution globally.” Rudiantara, Minister of Communication and Information Technology of Indonesia
“Governance frameworks need to allow enough flexibility to learn and to adapt in the face of rapid innovation, while not leaving anyone behind.” Doris Leuthard, Federal Councillor for the Environment, Transport, Energy and Communications of Switzerland
“The breadth of digital’s impact shows that this is not merely a challenge to be delegated to chief digital officers and others. It represents more than a commercial opportunity. The Fourth Industrial Revolution demands that CEOs take responsibility for the massive transformation of their businesses and for the extraordinary impact that this transformation will have on wider society.” Pierre Nanterme, Chairman and Chief Executive Officer, Accenture
“Digitalization is the most powerful force in our world today. It can bring profound benefits and empowerment, but only if handled with care and responsibility. The shared vision and action plan proposed in our report shows a path to meeting this future with confidence.” Mario Greco, Group Chief Executive Officer, Zurich Insurance Group, Switzerland
"The Internet is one of the greatest innovations in history, improving our access to information, commerce and each other in a way that we've never been able to before. It continues to hold revolutionary promise for improving the lives of people in even the most inaccessible parts of the world. The Digital Futures report makes clear how the stewards of the Internet's development are helping to make sure it lives up to its promise." Matthew Prince, Co-founder and CEO, Cloudflare
“By building on our national data and digital consultations, our government is identifying a path forward to create an inclusive and trustful digital economy where our full innovation potential can be unleashed. However, building an inclusive, trustworthy and sustainable digital society is truly global in scope. That’s why through our work on AI with our G7 counterparts, we will continue to collaborate with international partners to advance these important goals.” Navdeep Bains, Minister of Innovation, Science and Economic Development of Canada
“We are at a crossroads. More than half of the world’s population will be online by the end of 2018. Now is the time to redouble our collective efforts to leave no one offline, and this timely report outlines shared goals for an inclusive, trusted and sustainable digital future.” Houlin Zhao, Secretary-General, ITU
“We want everyone to thrive in the digital world -no one should be left behind. That means educating everyone on how to keep themselves and their data safe online, which is something that we at Barclays are very passionate about. But it also means ensuring universal access to a safe, secure and easy to use digital identity, so that everyone can confidently unlock the benefits of the digital economy.” Jes Staley, Group CEO, Barclays
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All opinions expressed are those of the author. The World Economic Forum Blog is an independent and neutral platform dedicated to generating debate around the key topics that shape global, regional and industry agendas.