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The future of the global digital economy

The future of the global digital economy

The World Economic Forum recently published an article looking at the global digital landscape and there are some pretty interesting insights about the changing competitive dynamics and where the next Google or Facebook will come from.  

Sadly, it's unlikely to be Australia or many western countries, including the Netherlands where I currently enjoy 300Mb per second Internet speeds (and had a whine about not being able to get the 500 Mb plan).

It's horrifying that Australia is not positioned to take advantage of changing technologies and is instead debating job creation from building mega coal mines. Our leaders are stuck in the past. 

Anyway, here are some of the take-outs: 1 billion jobs and $14.6 trillion in wages could be automated using todays technologies. The WEF reckons this is both an opportunity and a threat to addressing inequality.

  • Barely 50% of the world’s population has access to the internet today.
  • China's has 721 million Internet users and has developed a parallel digital market due to the lack of success from global (American) digital players.
  • India's growth is hampered by poor infrastructure and multiple languages but still represents a massive global opportunity with 421 million Internet users.
  • Even though global ecommerce sales will hit $4 trillion by 2020, the bulk of global transactions are still in cash and payment systems need to evolve to prompt ecommerce growth in developing countries where cashless payments can be less than 1% of transactions.

The WEF created what they call the Digital Evolution Index which looks at four zones: Stand Out, Stall Out, Break Out, Watch Out.

Stand Out countries are the ones growing fast with much digital innovation. That NZ makes the list here is impressive. Well done kiwis!

Stall Out countries are digitally advanced but growth is slowing. Something needs to change for these Countries to grow. G'day Australia you slow-coach.

Break out countries are digitally immature  but poised for growth. This is where the future global technology leaders will come from.

The WEF identifies that a strong digital economy comes from sophisticated public policy and government involvement in shaping the digital economy. This means a focus on skills development, education, access to capital and digital infrastructure, protecting consumer interests while fostering innovation, and avoiding the blind-focus on factories and mines. Advanced economies should drive innovation, whereas developing economies should focus on institutions and infrastructure.

Lastly, size doesn't matter here. NZ and Singapore are among the stand outs and creating smart digital ecosystems.

What is clear is that a lack of good policy and any debate in Australia is setting the country up for a dismal future. Our political leaders should be ashamed and focus less on mines and meta-data and more on infrastructure and creativity.

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