The ‘New Face’ of Inequality



WHILE the Covid-19 pandemic gave further boost to digital transformation in 2020, it also unveiled the widening digital gap among countries, which could now pose a challenge to their respective governments to bridge that gap and keep up with the era of digital advancement.

The Philippines ranks 77th on the 2020 United Nations E-Government Development Index (EGDI).

The UN EGDI assesses the progress in e-government. It has three components, namely, the online service index (OSI); the telecommunication infrastructure index (TII); and the human capital index.

Internet in full bloom

According to 2019 Philippine Statistics Authority (PSA) data, 58.5 percent used the Internet to obtain information from government organizations; 60.9 percent utilized the Internet to download or request government forms; 57.4 percent completed forms online; and 44.1 percent made online payments to government organizations.

Across the region, four of the 10 Asean member states rank higher than the Philippines, with Singapore ranking 11th; Malaysia at 47th; Thailand at the 57th, and Brunei Darussalam at the 60th spot.

Those that lag behind the Philippines are Viet Nam, which ranks 86th; Indonesia at 88th; Cambodia at 124th; Myanmar at 146th and Lao People’s Democratic Republic at the 167th spot.

The UN survey also assesses levels of e-government for one major city in 86 countries, through its local online service index (LOSI). The report highlighted that rankings for these local government portals do not follow their country rankings.

As for the ranking of the cities, Manila ranks 69th in the Global LOSI for assessed cities in the Asia-Pacific region, lagging behind Kuala Lumpur, which ranks 29th; Bangkok at 39th; Ho Chi Minh at 42nd; Jakarta at 47th and ahead of Yangon at 70th. The report noted that the rankings of these local government portals do not follow their country rankings.

Key element of transformation

THE Asia-Pacific Digital Transformation Report 2022 tags digital finance as a key element of transformation, particularly for business and people. For instance, digital financial service providers (DFS), such as fintechs and telecommunication companies, played a pioneering role in the development of digital payments services, with the mobile network operator Globe Telecom in the Philippines launching its e-wallet GCash in 2004.

The report noted that the success of the e-wallet business model, which allowed domestic money transfers among individuals that did not have bank accounts, was in part due to the ease of usage, even by rural populations.

As for the efforts needed to address the current digital divide, the report noted governments need to take “a strategic and considered set of PPPs (Public Private Partnerships).”

Stark gaps

IT is worth noting that an Economic and Social Commission for Asia and the Pacific (ESCAP) study revealed stark gaps between member states in terms of fixed broadband download speeds. For instance, the archipelagos of the Philippines and Indonesia have lower speeds, as do several countries in South and Southwest Asia.

Interestingly, the report bared that the status of digital transformation for each country is strongly correlated with its income level. However, the digital transformation status of some Asia-Pacific countries is relatively higher than their income grouping.

For example, lower-middle-income Asian countries, including India, the Philippines and Viet Nam, are identified as advanced digital transformation countries compared to their respective income levels.

“The Asia-Pacific region shows the widest digital divide between advanced and less advanced digital transformation countries,” the report noted.

The report underscored that even countries with advanced digital transformation statuses are driven by different factors providing support towards a “multi-pathway” approach for digital transformation.

PHL’s strength

IN the case of the Philippines, its strength lies in the “people pillar” due to the ease of finding skilled employees in the country. In the same way, Malaysia, another Asean member country, also performs well in the people pillar, which can be attributed to its strong pupil-teacher ratio in primary education and the skills of its workforce.

Meanwhile, Viet Nam shows strength in the “network pillar,” especially through fixed-line broadband affordability and smartphone penetration. Singapore, for its part, scored highly in the “government pillar” due to business and government investment and government effectiveness.

According to data obtained from PSA, a total of 275,735 establishments in the non-core Information and Communication Technology (ICT) industries were recorded in 2019 or before the pandemic. Of this number, 94.7 percent owned and used computers and communication equipment in their business operations.

Meanwhile, the proportion of establishments in the non-core ICT industries with Internet connection or access was 80.2 percent in 2019. Among the sectors, establishments from the Electricity, Gas, Steam and Air Conditioning Supply, and Education sectors recorded a proportion of 100 percent that had Internet connection.

However, in 2019, or prior to the pandemic, only 22 percent of establishments used the Internet for e-commerce transactions.

As for socioeconomic factors, the report underscored, “Rapid technological change can expose and exacerbate existing social, economic and geographical divisions. These include those related to age, gender, education, disability and between regions.”

The demographical divide

IN terms of age, the report unveiled that younger people who have grown up using the Internet can be considered “digital natives,” and are able to pick up digital skills faster. On the other hand, older people often have far less access to or are limited in their ability to use digital technologies due to a number of reasons.

Higher costs, the degree of support, lack of ICT skills, self-efficacy or motivation, concern over security, and decline in memory or in spatial orientation due to age are among the notable reasons stated by the report.

However, during the Covid-19 pandemic, access to digital services helped some older people overcome the social isolation from lockdowns, but those without access were often excluded even from government and social services, the report read.

As for the education divide, the digital divide also widened as people with higher levels of education tend to use the Internet more for education, work, career and business; while those with less education are more likely just to use it for entertainment, simple communications, or e-shopping.

UN forum slated

THE rapid, widespread adoption of digital technology, spurred in large part by the Covid-19 pandemic, and its economic and societal ramifications, are the key focus of deliberations at a United Nations forum this week.

“The United Nations has referred to the digital divide as the new face of inequality. That is why digital inclusion must be at the heart of digital transformation and accompanying digital policies and regulations if the promise to ‘leave no one behind’ is to be met,” said Armida Salsiah Alisjahbana, an Under-Secretary-General of the United Nations and Executive Secretary of the Economic and Social Commission for Asia and the Pacific (ESCAP).

In a statement, the UN ESCAP said it expects to endorse the Asia-Pacific Information Superhighway action plan for 2022-2026, which consists of a set of coherent actions aimed at bridging the digital divide and accelerating digital transformation for an inclusive digital society.

Key dignitaries speaking at this year’s committee include Ivan John E. Uy, Secretary of the Department of Information and Communications Technology of the Philippines.

Image credits: Diony Teixeira | Dreamstime.com



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