World Bank report deplores lost digital dividends

12Feb 2016
Our Reporter
The Guardian
World Bank report deplores lost digital dividends

World Bank has backed the potential of technology to transform lives and warned that there is a growing risk of creating a new underclass of the disconnected in the economy

Despite rapid spreading of internet and mobile phones in the country in particular and the whole world in general, the existing digital divide has failed to boost growth, jobs and delivery of better public services.

In its 2016 World Development Report: Digital Dividends, the Bank has highlighted a growing digital divide between the rich and poor.

The report shows no other technology has reached more people in so short a time as the internet and mobile phones but warned that the development potential of technological change is yet to be reaped.

Tim Kelly, a Co-author of the report and Lead Policy Specialist at the World Bank said there is need for governments to bridge the digital divide so that the poor can also benefit from it.

“Whilst internet, mobile phones and other digital technologies have spread rapidly throughout the developing world, the benefits of the expansion have been skewed towards the better-off, skilled and influential around the world,” Kelly said.

According to him, there is urgent need to continue connecting everyone and leave no one behind, because the cost of lost opportunities is enormous.

“But for digital boom to be widely shared among all sections of society, Tanzania also needs to improve its business climate, invest in people’s education and health, and promote good governance,” he noted.

He said 40 percent of adults in East Africa pay utility bills using a mobile phone, while 8 million entrepreneurs in China – a third of them women – use an e-commerce platform to sell goods domestically and export to 120 countries.

Speaking at the same ceremony, Bank of Tanzania Governor, Professor Benno Ndulu said there is need to foster improved technological innovation with a view to improve financial deepening thereby reducing the cost of transmission and increasing access to financial services.

Dr Chiara Bronchi, a Cluster Lead Governance official at the World Bank said the effect of technology on global productivity, expansion of opportunity for the poor and middle class, and the spread of accountable governance has been less than expected in the developing world.

“The digital divide should be addressed by making the internet universal, affordable, open and safe,” she stressed.

Bronchi pointed out that delivering the development potential of new technologies would require regulations to ensure competition among businesses.

Indhira Santos, the Bank’s Senior Economist said it is an amazing transformation that today 40 percent of the world’s population is connected by the internet.

Santos articulated that while these achievements are to be celebrated, this is also an occasion to be mindful that we do not create a new underclass.

“With nearly 20 per cent of the world’s population unable to read and write, the spread of digital technologies alone is unlikely to spell the end of the global knowledge divide,” he said.

The latest statistics by the Tanzania Communications Regulatory Authority (TCRA) show that mobile penetration stood at 70 percent with 32 million subscribers.

The number of internet users has grown to 11.35 million of which 7,716,500 million do so using individual subscription, 3,402,550 million use it at their place of a work and 239,040 million from internet cafes.