Technology backs growth in Asia, the Pacific: ADB

Kathmandu, Feb. 10

The Asian Development Bank (ADB) has said that digital platforms and other technology-based tools are providing new growth opportunities for businesses of all sizes and across all industries in Asia and the Pacific.

This is a trend which could contribute significantly to the region’s sustainable recovery from the coronavirus disease (COVID-19), it said in its ‘Asian economic integration report 2021’ published on Wednesday.

The report features a special theme chapter on the role and potential of digital technologies in contributing to inclusive and sustainable development, how digital technology can spur post-pandemic recovery in the region, and ways to accelerate digital transformation while managing the risks effectively.

“Countries in Asia and the Pacific have leveraged rapid technological progress and digitalisation to recover and reconnect to the global economy during the pandemic. Technology is helping to forge new global linkages, which offer enormous economic opportunities, but also present new risks and challenges,” said ADB Chief Economist Yasuyuki Sawada.

“It is imperative to implement policies and regulations that manage the disruptions and maximise the gains from the burgeoning digital economy, and to lock in these gains through enhanced regional cooperation,” he added.

Business-to-consumer revenues of digital platforms reached $3.8 trillion in 2019 globally, with Asia and the Pacific accounting for about 48% of the total or $1.8 trillion, equivalent to 6% of the region’s gross domestic product.

According to a statement published by the bank, these figures are expected to have significantly increased in 2020 as more business transactions—such as ride hailing, food delivery, and e-commerce—migrate to the digital space amid restrictions imposed to curb the spread of COVID-19.

Accelerated digital transformation can potentially boost global output, trade and commerce, and employment. According to the report, a 20% increase in the size of the global digital sector can increase global output by an average of $4.3 trillion yearly from 2021 to 2025.

Similarly, Asia and the Pacific would reap an economic dividend of more than $1.7 trillion yearly or more than $8.6 trillion over the 5 years to 2025.

There will be about 65 million new jobs created yearly in Asia and the Pacific until 2025 from increased use of digital technologies, with regional trade also expected to increase by $1 trillion yearly over the next 5 years, said the report.

Published in The Rising Nepal daily on 11 February 2021.