G20 Highlights Importance of Digital Technology

The Saudi Presidency of the G20 stressed on Wednesday that there is an agreed framework to tackle the digital divide in the world.

“If a health crisis like COVID-19 wiped out $6 trillion worth of economic value in few months… the world cannot afford to have a digital crisis that can wipe out the same economic value in a matter of weeks if not days,” said Saudi Minister of Communications and Information Technology Abdullah Alswaha.

“Digitalization has been at the heart of every transformational journey for creating wealth, prosperity, and competitiveness,” said Alswaha.

“This year, we have agreed that in a post-COVID-19 world, (digital technology) has become the lifeline for our kids to continue their education, the lifeline for our loved ones outside of the ICU room, and the gateway to opportunities for youth and women.”

He spoke in a virtual press conference following a meeting held by the G20 Digital Economy Ministers.

The meeting started with discussing the challenges facing digitization, including ways to bridge the digital gap.

The ministers emphasized the role of connectivity, digital technologies, and policies in accelerating collaboration and response to the COVID-19 pandemic and enhancing the ability to prevent and mitigate future crises.

“Artificial Intelligence (AI) systems have the potential to generate economic, social, and health benefits and innovation, drive inclusive economic growth, and reduce inequalities as well as accelerate progress toward the achievement of the Sustainable Development Goals (SDGs),” said the ministers, according to a statement released by the Saudi G20 Secretariat.

“They could also have potential impacts on the future of work, the functioning of critical systems, digital inclusiveness, security, trust, ethical issues, and human rights,” said the statement.

It said that in 2019, G20 Leaders acknowledged in Osaka the importance of data free flow with trust and cross-border data flow and recognized the critical role played by effective use of data for digitalization, as enablers of economic growth, development, and social well-being.

According to Wednesday’s statement, “the cross-border flow of data, information, ideas and knowledge generates higher productivity, greater innovation, and improved sustainable development.”

“At the same time, we recognize that the free flow of data raises certain challenges, such as the protection of privacy and personal data. G20 members recognize the need to address these challenges, in accordance with relevant applicable legal frameworks, which can further facilitate data free flow and strengthen consumer and business trust, without prejudice to legitimate public policy objectives,” said the ministers.

Building on the achievements of past Presidencies, they encouraged further work with stakeholders for the development of digital technologies and solutions for human-centric, environmentally sound, sustainable, rights-respecting, and inclusive smart cities and communities that boost competitiveness and enhance well-being and community resilience.

“These digital solutions should be centered around connectivity and providing services in more efficient and personalized ways, while safeguarding human rights,” they said.

The statement also quoted the ministers as saying that the ministers support advancing digital economy measurement.

“Reinforced cooperation will help advance consistency across different approaches and enhance evidence-based policymaking to contribute to the realization of the opportunities of the 21st century for all,” they said.

They also recognized that “the digital economy has and will continue to have wide-ranging implications as a driver of inclusive economic growth and development, contributing to the achievement of the Sustainable Development Goals, and as a means to prevent and address crisis situations and aid businesses and industry in recovering from the impact of COVID-19.”

“We acknowledge the crosscutting impact of the digital economy in overcoming development challenges, including growth, labor, employment, social, health, and cultural challenges. We therefore welcome continued discussion of the transformation of the Digital Economy Task Force to a Digital Economy Working Group.”

Data issued by the Statistical Center for the Cooperation Council for the Arab Countries of the Gulf (GCC-Stat) indicate that the financial risks of the GCC countries will be low in the short term amid forecasts of stable or declining interest rates locally and globally.

The reports issued by Credit rating agencies also signaled an improvement in the sovereign bond rating of the GCC countries in 2023. It is also expected that the credit attractiveness of GCC countries will increase, which would allow for the rescheduling of their public debts at lower financial costs.

According to the estimates of the GCC-Stat, the public debt of the GCC countries is expected to stabilize at 28% of the GCC countries’ GDP during the years 2024 and 2025. The financial budget reform plans, which are based on improving the efficiency of public spending and programs to stimulate growth in non-oil sectors, would contribute to achieving a balance between maintaining the economic growth rate and the sustainability of public spending.

The data issued by the GCC-Stat also reveal that the public debt of the GCC countries has doubled over the past ten years to reach about $628 billion in 2023, after it was $144 billion in 2014. The volume of debt as a percentage of the GCC Countries’ GDP increased to reach its peak in 2020 at 40.3%, before declining in the following years to reach about 29.8% in 2023.

The total public finances in the GCC countries also recorded a significant deficit during 2014-2021. The highest deficit value was registered in 2015, with an amount of about $158 billion, which accounts for 11.1% of the total GCC Countries’ GDP. In 2020, a deficit of $128 billion was recorded, which represents 8.8% of the total GDP.

The public finances of the GCC countries witnessed a significant financial surplus in 2022 estimated at $134 billion, representing 6.1% of the gross domestic product, followed by a surplus of $2 billion in 2023.

The total public revenues in the GCC developed significantly during the period 2021-2023 to record about $641 billion in 2023. Oil revenues accounted for 62% of public revenues, compared to $723 billion in 2022, of which oil revenues accounted for 67%.

Total public spending in the GCC countries reached its highest levels in 2023, recording about $639 billion. Current spending accounted for 85% of the total public spending, compared to 15% for investment spending in the GCC countries.

G20 Highlights Importance of Digital Technology