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  • Writer's pictureAndrea Morter-De Cecco

The issue of ‘digital divide’ in today’s economy

The ever-increasing digitalization of the global economy has been pressuring the world of finance Into taking part in such transformative changes. The growing Internet access and use of smartphones have meant growing interest and participation in e-commerce and investment, accompanied by the growing numbers of entrepreneurs, keen on gaining a competitive foothold in the market. This is seen in Algeria’s internet penetration reaching 2020 over 61% of the population, from 18% in 2010, according to the International Telecommunication Union.

The increasing prevalence of a digital economy overall would allow large improvements in transforming for more sustainable economic growth by replacing fossil fuels. This is on top of speeding up the sharing of information and more efficient and effective work-life management. Because of this, it is expected that individuals will have to gain experience and knowledge in the technological sector in handling the digitalization of the economy.

However, a notable challenge to reckon with the constant upskilling, on top of adaptation, to new digital demands. This will lead to further difficulties in 'who' will be able to access such digital assets and when would it be available for them. This is especially true as there is still a large prevalence of non-digital industries in many areas. According to Brookings, as a continent holding large swathes of diversity in industries and employment opportunities, companies both currently and soon ought to be careful in not diverting attention to support earnings from agricultural and informal sectors as well, as they hold large relevance in sustaining economies. Thus, countries require efficient and realistic policy strategies addressing the current economies of these countries through their contexts, to ensure future inclusion in access to the growing digitalization of the economy.

The World Bank states that in countries that are in the middle of this technological transition, these inequalities are especially highlighted. According to IDRonline, in 2023 India had access to technology for 44% of the population in urban areas, contrasting to the 17% in rural areas. Such differences only highlight this ‘digital divide in inequality’, with the lack of appropriate and efficient digital infrastructure not always accessible in all areas of the country.

A further challenge in accessing the digital economy is the question of affordability. In countries such as the Democratic Republic of Congo (DRC), this is especially highlighted, as BF Africa demonstrates how only 19% of Congolese have reliable internet access; that is, 1 in 5. Arguably, ways to access and part-take into the digital economy are already present. Starlink, for example, allows internet access into the rural areas of the country not traditionally accessible digitally, ensuring equal opportunities in benefiting the digital economy and bringing new opportunities for growth and participation. However, such costs can be prohibitive for most, especially in poorer rural areas of the DRC. Therefore, it is necessary to encourage collaboration between the private sector providers of digital technology, governments and local communities, in ensuring the decrease of this ‘digital divide’ in the economy.

To ensure a more ethical and inclusive participation of technology in the economy, it is central to give fairer possibilities and access to such services. Countries with emerging economies would have to ensure this to gain greater competitiveness at the global scale. Currently, if developing oping markets do not initiate greater integration, it may result in greater social inequalities to digital access and greater difficulty in ensuring more efficient economic growth. 



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