Digital economy needs more investment

The government is working to transform the country from digital to 'Smart Bangladesh' by 2041. Prime Minister Sheikh Hasina has repeatedly expressed her determination regarding the matter.

There are four foundations of building 'Smart Bangladesh'. These are Smart Citizens, Smart Economy, Smart Government and Smart Society. Ideally, in Smart Bangladesh, everything will be through digital technology. The citizens will need to be skilled in the use of technology and the entire economy will hopefully be managed through it.

Four drivers of change are expected to influence business growth in the next five years — high-speed mobile internet, artificial intelligence, widespread adoption of big data analytics and cloud technology.

Against this background, the sector directors have urged for more investment in the digital sector to build a smart Bangladesh.

According to a report published in this newspaper on Monday speakers at a session of the Bangladesh Business Summit urged the local and international investors to invest in the country’s Information and Communication Technology (ICT) sector to build a strong digital economy to pave the way to smart Bangladesh. Sector insiders made the recommendations at a panel discussion, titled “Harnessing Digital Economy to Unlock New Frontiers for a Smart Bangladesh”, on the second day of the ongoing business summit being held at Bangabandhu International Conference Centre in the capital.

The fast pace of digitalisation of economies is having a profound impact on the lives of people, governments and markets. As more and more people adapt to the digital economy, policymakers need to think swiftly and carefully about devising policies that will maximise the benefits of the digital revolution while mitigating the risks of job dislocation.

Digital progress is the result of general-purpose technology that has the flexibility to transform itself as the driver of change for boosting productivity across all sectors. By reducing the cost of information, digital technologies could greatly reduce the cost of economic and social transactions for firms, people and the public sector. A striking fact is that less-developed economies are quickly adopting these technologies and are taking a lead in the usage of digital technologies.

The digital economy is not all smooth sailing. While the digital economy could accelerate the pace of labour market dynamics by opening new opportunities, it also makes traditional skills obsolete. The change calls for more adaptability, flexibility among firms and individuals.

As a policy intervention, this calls for stronger lifelong nexus between the industry and training institutions. The focus of public policy in skills development has to move towards ICT skills, science and mathematics, problem-solving and lifelong learning.

The full benefits of the digital transformation will not be realised unless Bangladesh continues to improve investment climates, invest in appropriate education and health and promote good governance

In Bangladesh, the digital revolution is well underway and is impacting the parameters of large-scale manufacturing, retail, banking and logistics businesses. Digital transactions are increasing rapidly and have already reached a major portion of overall transactions in developed economies.

According to media reports in recent times in this country, digital commerce transactions on cards or fintech have doubled, from 15 per cent to 30-35 per cent. However, in India, more than 75 per cent of the population is carrying out digital transactions.

Digitalisation will have a serious impact on job transformation. Bangladesh, along with the rest of the world, is entering a new marketplace of smartphones, robotics and artificial intelligence. There is no turning back now as digital technology is expected to accelerate its pace in the coming years.