Governments urged to bridge the digital divide as connectivity becomes essential

Narrowing the gap will help shape economies and societies post-Covid-19, new OECD report finds

An Amazon warehouse in Arizona. A significant indicator of the pivot to an increasingly digital economy is the notable rise in e-commerce sales, the OECD report said. AP

Countries around the world have been called on to do more to bridge the digital divide as internet connectivity becomes more important for remote working and learning amid the Covid-19 pandemic.

Internet service providers reported a 60 per cent growth in traffic since the pandemic began as millions of people worked from home and pupils learnt online, according the Organisation for Economic Co-operation and Development’s latest Digital Economy Outlook.

However, the pandemic has thrown light on digital gaps within the 37-member bloc and developing economies.

The report shows that even within the OECD, the share of fixed broadband subscriptions varies widely.

South Korea and Japan, which have sophisticated digital economies and smart cities, have adoption rates of 82 per cent and 79 per cent, respectively.

In comparison, Austria, Belgium, Germany, Greece, Israel and the UK have adoption rates that are below 5 per cent, with rural areas particularly underserved.

OECD countries typically have twice the level of high-speed mobile internet subscriptions per person and three times the number of fixed broadband subscriptions of non-OECD nations.

OECD deputy secretary general Ulrik Knudsen said digital technology had helped countries in the bloc avoid a complete standstill during the Covid-19 crisis, and enabled them to learn more about the virus, hasten efforts to find a vaccine and track the development of the pandemic.

“We are at a turning point in the digital transformation, and the shape of our economies and societies post-Covid will depend on how well we can progress and narrow these divides,” he said.

The latest digital outlook showed that OECD economies had 113 high-speed mobile internet subscriptions per 100 inhabitants as of June 2019, up from 32 per 100 a decade earlier.

Non-OECD countries, meanwhile, have 60 subscriptions for such services per 100 people.

A significant indicator of the pivot to an increasingly digital economy is the notable rise in online sales as a share of total sales, the report said.

Only a quarter of companies with more than 10 employees across the OECD bloc registered online sales before the pandemic, while a third purchased cloud computing services and more than half had a social media presence.

The share of people using e-government services rose from 43 per cent in 2010 to 58 per cent in 2019.

The OECD's recommendations to boost digital services come after the International Monetary Fund urged governments and institutions to speed up digitisation efforts.