Print
DEV/3439
25 May 2021
LDC5 Preparatory Committee, First Session

Digital Connectivity Essential for Least Developed Countries to Reap Benefits of Fourth Industrial Revolution, Experts Tell Preparatory Committee

Science Academies Should Not Be ‘Gentleman’s Club of White Coats’, Panellist Warns, as Others Call for Delivering Internet Access, Lowering Prohibitive Costs

Digital connectivity and access to modern technologies are essential for least developed countries to reap the benefits of the fourth industrial revolution and build resilient economies after the ravages of the COVID-19 pandemic, speakers and panellists told the Preparatory Committee for the fifth United Nations Conference on the Least Developed Countries today.

Sajeeb Wazed, Information and Communication Technology Affairs Adviser to the Prime Minister of Bangladesh, cited a major national 13-year initiative that has transformed the country into a digital leader among developing nations.  Since founding Digital Bangladesh in 2008, Bangladesh has boomed from 3 per cent of its people online to 70 per cent, or 116 million people.

He noted the significant economic payoff, with gross domestic product (GDP) growth in Bangladesh outpacing India, Pakistan and even China, rising by 6 per cent during the pandemic when whole of South Asia decreased by 6 per cent.

However, “it is a myth that competition alone can solve broadband issues”, he stressed, as countries must invest in information technologies the way they do in roads, fostering public-private partnerships to lay down infrastructure, reduce costs and spur innovation.  Bangladesh is willing to share expertise in developing that technology at low cost using their own innovation.

At the Doha conference, Heads of State and Government will formulate a successor framework to the Istanbul Programme of Action, adopted in 2011.  The intergovernmental Preparatory Committee will meet twice beforehand, from 24 to 28 May, and from 26 to 30 July, to agree on elements of the new 10-year framework.  An organizational session of the Committee was held on 8 February, to elect its two Co-Chairs.

Despite the Bangladesh success story, speakers emphasized that too many people in least developed countries still lack access to digital technologies and services that have become essential in the age of COVID-19.  They recalled the target set by the Istanbul Programme of Action calling for universal and affordable access to the Internet by 2020, pointing out that, in 2019, almost 87 per cent of people in developed countries used the Internet, compared with only 19 per cent in the world’s poorest, a divide exacerbated by the pandemic.

And costs remain prohibitive, reminded Moshe Kao, Programme Management Officer for the United Nations Technology Bank for Least Developed Countries.  Achieving universal, affordable and quality Internet access by 2030 across Africa may cost as much as $100 billion.  Reaching 3.6 billion currently unconnected people worldwide will cost much more.  Scientific academies should not be “a gentleman’s club of white coats”, he stressed, noting that less than 1 per cent of scientific articles emerge from least developed countries.

That sentiment was echoed by Thelma Quaye, Head of Digital Infrastructure and Capacity Building of the Smart Africa Secretariat, who called for broadband to be an essential service, like water and electricity.  Information and communications technology must be mainstreamed in education or “we are preparing our children for failure in the next 10 years”, she said.

“Technology is not a silver bullet,” said Shahid Yusuf, Chief Economist of The Growth Dialogue at the George Washington University School of Business in Washington, D.C., and Adjunct Professor at Johns Hopkins University’s School of Advanced International Studies.  However, it can substantially reinforce the growth impetus that sound policies deliver.

The other morning speakers featured were Perks Master Clemency Ligoya (Malawi), Co-Chair of the Committee; keynote speaker Houlin Zhao, Secretary-General of the International Telecommunication Union (ITU); and representatives of the World Food Programme (WFP) and the World Intellectual Property Organization (WIPO).

The representatives of Bangladesh and Turkey also spoke.

In the afternoon, the Preparatory Committee held its third panel discussion, under the theme, “Structural transformation as a driver of prosperity”.

The Preparatory Committee will reconvene at 10 a.m., on Thursday, 27 May, continuing its first session with two virtual panel discussions.

Panel 2

In the morning, the Preparatory Committee held the second of its panel discussions on the theme of “Leveraging the power of science, technology and innovation to fight multidimensional vulnerabilities and achieve the Sustainable Development Goals”, co-chaired by Marie Chatardová (Czech Republic) and Perks Master Clemency Ligoya (Malawi) and featuring keynote speakers Sajeeb Wazed, Information and Communication Technology Affairs Adviser to the Prime Minister of Bangladesh; and Houlin Zhao, Secretary-General of the International Telecommunication Union (ITU).

It also featured panellists Thelma Quaye, Head of Digital Infrastructure and Capacity Building of the Smart Africa Secretariat; Shahid Yusuf, Chief Economist of The Growth Dialogue at the George Washington University School of Business in Washington, D.C., and Adjunct Professor at Johns Hopkins University School of Advanced International Studies; and Moshe Kao, Programme Management Officer for the United Nations Technology Bank for Least Developed Countries.

Introducing the speakers, Ms. CHATARDOVÁ highlighted the need to overcome structural constraints on education, electricity and broadband connectivity, with investment in human capital.  Least developed countries need access to modern technologies to reap benefits of the fourth industrial revolution, she said, promoting private sector engagement in the process.

Mr. WAZED cited his country, Bangladesh, as a “perfect example” of how to propel connectivity.  Since founding Digital Bangladesh in 2008, gross domestic product (GDP) growth in the country has outpaced that of India, Pakistan and even China, growing by 6 per cent during the pandemic when the whole of South Asia decreased by 6 per cent.  Switching to “digital governance” during the crisis, providing digital health information via mobile phones, he said Bangladesh has one of the world’s lowest COVID-19 rates, with 12,000 fatalities in the eighth largest global population.  Twelve years ago, the country had one of most expensive broadband networks yet only 3 per cent of its people were online; that number is now 70 per cent, or 116 million.

“It is a myth that competition alone can solve broadband issues”, he said, as countries must invest in information technologies the way they do in roads.  Bangladesh fostered a public-private partnership, laying fibre-optic cable down to the village level, with 90 per cent of its territory now covered in 4G connection, and satellites reaching remote islands that cable cannot access.  The Government has invested several billion dollars, which has paid off in utility and economic growth, with initiatives including training village entrepreneurs — 5,000 of them women — and mobile payments during the pandemic as part of the social safety net.  Corruption in the social service sector has been virtually eliminated at local level, while the Government has trained 2 million people in information technology skills, transforming Bangladesh from a “digitally backwards country”, he said.  Bangladesh has expertise in developing technology at low cost using their own innovation, he added, and is happy to share it throughout developing world.

Mr. ZHAO emphasized that too many people in least developed countries still lack access to the digital technologies and services that have become essential in the age of COVID-19 — this despite the target set by the Istanbul Programme of Action calling for universal and affordable access to the Internet by 2020.  Addressing that challenge, ITU is building a network of partners undertaking host of projects from infrastructure development to capacity‑building.  He cited the partnership with the United Nations Children’s Fund (UNICEF), to connect every school to Internet by 2030, involving Governments and benefitting countries in Africa, the Arab region, Asia and the Pacific, and the Americas.  ITU is also working with the International Labour Organization (ILO) to enhance digital skills for youth, and with Australia on broadband connectivity for Pacific small island developing States.  All these projects contribute to both the Istanbul Programme of Action and to the Programme of Action to be adopted at the Doha conference, he said, stressing the importance of connectivity.

Ms. QUAYE said her group aims to transform Africa into a single digital market and is active in 31 countries thus far.  It is increasingly obvious that digitalization must be at the centre of development.  She noted the irony that the pandemic was an advocate for that transformation, given the needs it revealed in education, health and financial services.  However, she noted the situation in the global South is not as dire as it seems, given the example of Bangladesh.  While Africa has not adopted the latest technologies, it has found a niche in innovation, as “mobile technology works best for us”, with more than 60 per cent of the population in rural areas.  Broadband must be an essential service, she said, like water and electricity, noting a “usage gap” as 46 per cent of Africa’s population has coverage but cannot afford to use it.  Information and communication technology must be mainstreamed in education; otherwise “we are preparing our children for failure in the next 10 years”.

Mr. YUSUF said technology has amply demonstrated its importance through history, from the steam engine, electric power and the internal combustion engine to computerization, the Internet and digital technologies, each innovation improving growth potential and human welfare.  For least developed countries, the promise of technology lies in precision agriculture, and selective automation of certain manufacturing tasks to raise productivity and export competitiveness.  Digital technologies also enable retail, financial, business and engineering services to displace manufacturing as the leading activities.  The pandemic has further highlighted the contribution of digital and biogenetic technologies to build human capital.  He noted that business thrives in a stable, open environment where the likelihood of unpredictable policy shifts is low and the State removes infrastructure constraints.  “Technology is not a silver bullet,” he said, but it can substantially reinforce the growth impetus that sound policies can deliver.

Mr. KAO recalled that the Istanbul Programme of Action had set a target of at least half of least developed countries qualifying for graduation, but only three have managed it, while seven others have met the criteria for 2026.  He cited the tremendous technological challenge posed by COVID-19:  in 2019, close to 87 per cent of people in developed countries used the Internet, compared with only 19 per cent in least developed nations — and the pandemic has exacerbated that divide.  Less than 1 per cent of scientific articles emerge from those countries, despite accounting for 15 per cent of the global population.  Achieving universal, affordable and quality Internet access by 2030 across Africa may cost as much as $100 billion, he stressed, and reaching 3.6 billion currently unconnected people worldwide will cost much more.  Least developed countries must develop hard and soft infrastructure.  Broadband should be an essential service, and scientific academies should not be “a gentleman’s club of white coats”, he said.

The representative of Bangladesh said long-term political vision is important in delivering technological change on the ground.  Least developed countries lack skills and infrastructure, meaning the LDC5 outcome document must establish ambitious goals.  As women have less access to digital technologies, she asked the panel how that can change.  She further asked how the United Nations can include the private sector.

The representative of Turkey also asked how Members States can support the United Nations Technology Bank and forge partnerships with private sector.

The representative of the World Food Programme (WFP) said hunger is on the rise worldwide, with the number of food insecure people having doubled to 270 million during the pandemic.  The responses rely on technology on all levels.  Drawing attention to tools, such as the Hunger Map, and the deployment of drones in Mozambique after Cyclone Idai, he said “we need to get out of the lab and the white coats” to address a cross-pillar approach.

The representative of the World Intellectual Property Organization (WIPO) said the world not only needs technological solutions for the pandemic, but food security, health care, access to information and achieving the Sustainable Development Goals.  He expressed a vision of a world where innovation anywhere is supported by intellectual property everywhere.  Some key WIPO initiatives have included free access to high-end resources, and transfer of technology to least developed countries.  Innovation is increasingly recognized as essential for a sustainable future, he said, as most of the Goals rely on it, so the international community must assist least developed countries in “innovation catch-up”.

Mr. WAZED said information technology infrastructure is expensive, not just for connectivity, but usage and devices, which is why Bangladesh’s efforts are focused on the public-private partnership model.  He described the $100 billion cost to connect Africa as a “chicken-and-egg problem”, as if there are not enough rural users, private technology companies do not want to build infrastructure.  Bangladesh connected Government offices and digital centres in a revenue-sharing model, he explained, and once basic infrastructure like fibre-optic cable was in place, mobile companies could provide faster service.  The country now has local smartphone brands available for under $50, he said, noting that the Government lays fibre-optics along electricity and railway lines to greatly reduce costs, and both uses and customizes open-source software.

Ms. QUAYE echoed calls for public-private partnerships, citing the statistic that only 1 per cent of research comes from least developed countries.  Her group is working to increase that share, she said, noting that the Smart Africa Secretariat has an open door to future collaboration with any of the panellists’ organizations.

Mr. YUSUF said that much hope rides on digitalization, but, while the technologies mentioned have been available in developing economies — in some cases for decades — productivity growth has actually been declining.  Until it can be enhanced by entrepreneurs through innovation, “we will not see the full benefits”.

Mr. KAO noted the synergies emerging from speakers’ interventions, also underscoring the importance of the private sector because “they are the ones holding the technologies”.  The World Trade Organization (WTO) Trade-Related Aspects of Intellectual Property Rights Agreement “could be a game-changer”, he said.  Responding to Turkey’s delegate, he said Member States support the Technology Bank, as “we are a facilitator”.  The Bank was set up as a repository for technologies, which can be diffused through the private sector to least developed countries.  It also works through other organizations, he noted, including the United Nations Office for Outer Space Affairs, to generate satellite technology for information on climate change and food security.

The Committee reconvened at 3 p.m. for its third panel discussion, under the theme “Structural transformation as a driver of prosperity”.

Panel 3

In the afternoon, the Preparatory Committee held a panel discussion on the theme, “Structural transformation as a driver of prosperity.”

Chaired by Taye Atske Selassie Amde (Ethiopia), it featured two keynote speakers:  Faruk Kaymakci, Deputy Foreign Minister and Director for European Union Affairs of Turkey; and Amadou Hott, Minister for the Economy, Planning and International Cooperation of Senegal.  Panelists were Agnes Kalibata, Special Envoy of the United Nations Secretary-General to the Food Systems Summit; Paul Akiwumi, Director, Division for Africa, Least Developed Countries and Special Programmes of United Nations Conference on Trade and Development (UNCTAD); and Gauri Pradhan, International Coordinator, LDC Watch.

Mr. AMDE said that, while least developed countries have made efforts to enhance several areas of their economic performance, trade and human development during the past decade, many have been largely unable to structurally transform their economies to build resilience against internal and external shocks.  Challenges that have hindered their progress include difficulties in integrating regional and global value chains; limited availability of energy, transport and information and communications technology infrastructure; limited availability of human capacities; insufficient investments; challenges in accessing credit and unfavourable legal and regulatory frameworks.  Looking ahead, new technologies have raised hopes for leapfrogging.  To meet the Sustainable Development Goals by 2030, countries must assess which sectors contribute most to higher productivity, and ultimately, create decent jobs and eradicate poverty.  Drawing lessons from implementation of the Istanbul Programme of Action, he said achieving structural transformation will not be possible with a “one-size-fits-all” approach.

Mr. KAYMAKCI, in his keynote speech, said that, over the past decade, with support from development partners, least developed countries have made significant progress in implementing both the Istanbul Programme of Action and the Sustainable Development Goals.  The limited productive capacities are the main cause of the persistent challenges facing least developed countries.  Enhancing agricultural productivity is important for reducing poverty, as it fosters better food security and higher farm incomes.  Tourism is another cornerstone of structural transformation, growth and employment in developing economies and has been among the hardest hit of all sectors by COVID-19.  Therefore, it is imperative to support tourism and ensure that the sector regains its position as a provider of decent jobs, stable incomes and a guardian of cultural and natural heritage.

Noting that trade in services creates new economic opportunities and contributes directly to productivity gains, he said it is therefore an important channel for helping least developed countries enhance their share in global trade.  The international community should continue to support duty-free and quota-free market access for these countries.  Direct investment and concessional loans, in addition to ODA, have been important instruments for Turkey.  Investments by Turkish entrepreneurs particularly in Africa increase every year within the framework of the “Cotonou Agenda” for productive capacity‑building in least developed countries.  For the last 35 years, he said, Turkey has supported them through international financial institutions, and actively helped them strengthen their science, technology and innovation capacities.  Turkey’s commitment is seen in the establishment of the United Nations Technology Bank on its territory.  The success of the new Programme of Action will depend on the efforts made by least developed countries and the international community.

Ms. KALIBATA stressed that agriculture is the backbone of least developed country economies, contributing to their food security, export earnings and rural development.  The most effective way to improve the lives of millions living in poverty is to support agriculture in developing countries.  Among the challenges they face are low productivity, rigid production and trade structures, a limited skills base, short life expectancy and low educational qualifications, poor infrastructure, and inadequate institutional and policy frameworks.  Transforming a country’s agriculture sector can create jobs, raise incomes, reduce malnutrition and kick-start the economy onto a path to middle-income growth.  For example, least developed countries can export fresh-cut fruit in retail-ready packaging rather than bulk fruits.  For agricultural and food systems, transformative opportunities generally lie in the middle part of agri-food value chains, such as in modern pack‑house operations and processing facilities.  These are where most of the value addition in the food system takes place and they are essential in linking farmers to rewarding markets.  In Africa, two thirds of all food consumed is handled by the millions of small and medium-sized enterprises.  Focusing more attention on this sector can create huge employment opportunities, especially for youth.  The opportunities for improved food systems are almost limitless, he said, noting that the United Nations Food Systems Summit represents an opportunity to foster change in the approach to development challenges.

Mr. AKIWUMI said that structural transformation can be understood as the ability of an economy to constantly generate new dynamic activities characterized by higher productivity and increasing returns to scale.  Bangladesh — a country that was found eligible for graduation after having met the three criteria — did manage to undertake structural transformation through building productive capacities in the low-tech manufacturing sector.  Unfortunately, the case of Bangladesh is more of an exception than the rule.  One way to achieve it is by supporting the request of least developed countries, made within WTO, to extend their transition period.  The cause of their vulnerability is the limited development of their productive capacities.  UNCTAD has identified eight components of productive capacities — natural capital, human capital, energy, information and communications technology, transport, private sector, institutions and structural change.  The next Programme of Action must help least developed countries make durable progress towards and beyond graduation, a process UNCTAD calls “graduation with momentum”.  Therefore, productive capacities should form the overarching framework for the next Programme of Action.  All other strategies and related policies should be intertwined within this broad goal, rather than appearing as the usual “shopping list”.  UNCTAD has developed a Productive Capacities Index as a policy tool to help Governments gauge the development of their productive capacities, he noted, stressing that the entity must be considered their key partner, including in the negotiation of the text for the Doha Programme.

Mr. PRADHAN said several structural adjustment initiatives introduced in recent decades have failed to deliver promised outcomes.  Conventional structural transformation has not driven growth, in part because there is a disconnect between material gains and human assets.  Many international conventions and agreed mechanisms on least developed countries remain weak in terms of their impact on local communities.  Donors, meanwhile, have not fulfilled their commitments to help improve infrastructure in the poorest countries, he said.  In turn, Governments have failed to control ever-increasing corruption, disparity and instability.  Unsustainable debt has also generated unequal access to intellectual property rights.  He called on the international community to ensure access to affordable, reliable, sustainable energy, to direct all kinds of technical assistance towards essential, specific infrastructure, and to consider information and communications technology as an indispensable driver for infrastructure.  It also must assist least developed countries with climate adaptation and mitigation, recognize the crisis caused by COVID-19 and address the existing resource constraints.  “The next Programme of Action cannot be a continuation of the past failed experiences,” he emphasized.

In the ensuing discussion, the representative of Malawi, speaking for the Least Developed Countries Group, said structural transformation is a stumbling block to meeting the Sustainable Development Goals.  Many least developed countries depend on commodity production and exports, making them vulnerable to price fluctuations, he said, underscoring the importance of economic diversification.  Partnerships and collaboration are needed to ensure capacity‑building for least developed countries, he said, commending UNCTAD on the creation of its Productive Capacity Index.

The representative of Bangladesh highlighted the need for the right mix of policy options for structural transformation.  “Our inability to do so right now may lead to a situation wherein the current decade may be dubbed as a decade of lost development,” he warned.  However, some least developed countries, including his own, have started to move away from this vicious cycle.  As people expanded from agriculture into industry and service sectors, value additions increased in all sectors.  He asked panellists about innovative initiatives that can be undertaken to foster resilient infrastructure and about how small and medium-sized enterprises can better integrate into global value and supply chains.

The representative of the Private Sector Development said the next Programme of Action must incentivize small and medium-sized enterprises.  Regulatory frameworks and access to finance could be either barriers or enablers.  The perception of “responsible investment” needs to change, as investors avoid investing in least developed countries.  Reputational risk can be turned into reputational opportunity.  The United Nations Principles of Responsible Investments must be revised to encourage a certain level of investment in least developed countries.  In addition to ODA, he called for a new financing mechanism to support impact investments.

Mr. AKIWUMI pointed out that, when building infrastructure, it is important to consider the connectivity of production and markets.  To develop e-commerce, countries also need a stable power supply and steady Internet connectivity.  On access to financing, he said it is extremely difficult for local firms to compete in regional markets if they are borrowing at an interest rate of 19 per cent.  Least developed countries can export their commodities to their neighbours.  In Kenya, Swiss chocolate is cheaper than Egyptian chocolate.  Africa should focus on concluding a continental free trade agreement.  By curbing illicit financial flows, low-income countries can generate domestic financing.  The biggest obstacle to developing fisheries in Africa is obtaining public health certification, in order to be accepted in the European market.

Summing up the discussion, Mr. AMDE said the issue of structural transformation can be addressed before the Doha conference.  The Istanbul Programme charted out a vision and aspiration for least developed countries.  The Doha Programme must give more vitality to the development of least developed countries.

For information media. Not an official record.