1、DIGITAL PROGRESS AND TRENDS REPORTDIGITAL PROGRESS AND TRENDS REPORT 20232023Digital Progress and Trends Report 2023Digital Progress and Trends Report 2023 2024 International Bank for Reconstruction and Development/The World Bank1818 H Street NW,Washington,DC 20433Telephone:202-473-1000;Internet:www

2、.worldbank.orgSome rights reserved1 2 3 4 27 26 25 24 Revised 2024On p.xvii,the last sentence of the first bulleted item has been revised to refer to individuals in low-income countries.This work is a product of the staff of The World Bank with external contributions.The findings,interpreta-tions,an

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7、 purposes,under the following conditions:AttributionPlease cite the work as follows:World Bank.2024.Digital Progress and Trends Report 2023.Washington,DC:World Bank.doi:10.1596/978-1-4648-2049-6.License:Creative Commons Attribution CC BY 3.0 IGOTranslationsIf you create a translation of this work,pl

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12、,tables,figures,or images.All queries on rights and licenses should be addressed to World Bank Publications,The World Bank,1818 H Street NW,Washington,DC 20433,USA;e-mail:pubrightsworldbank.org.ISBN(paper):978-1-4648-2049-6ISBN(electronic):978-1-4648-2050-2DOI:10.1596/978-1-4648-2049-6Cover and inte

13、rior design:Bill Pragluski/Critical Stages,LLC.Library of Congress Control Number:2023924019 vContentsForeword.xiAcknowledgments.xiiiExecutive Summary.xvAbbreviations.xxiiiPART 1:PROGRESSChapter 1 Digital Adoption:Accelerating Postpandemic,yet a Widening Divide .3Key messages.3Introduction.3The shar

14、e of Internet users in middle-income countries is moving closer to that in high-income countries,while the share in low-income countries continues to lag.4Larger gaps are forming in internet speeds and data use.9COVID-19 boosted the use of business,education,finance,medical,health,and shoppingapps.1

15、1Digital uptake by businesses varies significantly across countriesand types of technology.13Firms with greater digital readiness before the pandemic and those that investedin digitalsolutions during the pandemic were more resilient.17Digital adoption and diffusion must be facilitated to narrow the

16、digital divide.19Notes.20References.20Chapter 2 The Digital Sector:A Driver of Innovation,Growth,and Job Creation .23Key messages.23Introduction.23The digital sector drives growth,creates jobs,and generates huge positive spillovers.25vI D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0

17、 2 3 Pathways to create value in the digital sector.30Notes.43References.43Chapter 3 Digital Infrastructure:The Continual Need for Upgrading and Greening .45Key messages.45Introduction.45Telecom network investment moves from coverage toward upgrading.46Governments can increase the efficiency of tele

18、communication investment.48Data infrastructureIXPs,data centers,and cloud computingis a vital part of the digital economy.51Developing countries need to accelerate investment in data infrastructure.56Greening digital infrastructure creates opportunities for low-and middle-income countries.57Notes.61

19、References.62PART 2:EMERGING TRENDSChapter 4 Digital Public Infrastructure:Transforming Service Delivery Across Sectors .67Key messages.67Introduction.67What is DPI,and why is it important?.68Key gaps remain in access to IDs,e-signatures,data exchange,and digital payments.74How to build good DPI.81N

20、otes.82References.82Chapter 5 Artificial Intelligence:Revolutionary Potential and Huge Uncertainties .85Key messages.85Transformer models and large language models mark a new stage in artificial intelligence development.86Potential benefits and risks of AI .87Implications of AI for low-and middle-in

21、come countries:a blessing or a curse?.93AI governance principles and divergent regulatory trends.96Strategies to accelerate safe and inclusive AI adoption .99A new playbook for development in the AI era.100 C O N T E N T S vIINotes.102References.102 Appendix A:Data Sets Used in the Report .107BoxesE

22、S.1 About this report .xvi2.1 The importance of apps and an overview of Apptopia app performance data.393.1 Connecting the unconnected:a US$400 billion investment is needed.503.2 Kenyan internet exchange point.553.3 Liberalizing energy markets to attract ICT companies.604.1 Different approaches to D

23、PI.704.2 Growing evidence on the impact of DPI.724.3 Examples of digital IDs:Ethiopias Fayda,Frances FranceConnect,and Maldives eFaas.754.4 Data-sharing examples:Indias DigiLocker,Singapores APEX,and Ugandas UGHub.785.1 Views of industry leaders on AI.101Exhibit4.1 How to build good digital public i

24、nfrastructure.81FiguresES.1 Report framework.xv1.1 Internet users as a share of population,global and by country income group,19902022.51.2 Location,age,and gender digital divides,by country income group,2019 and 2022.61.3 Fixed and mobile broadband penetration,by country income group,201522.71.4 Pr

25、ice of fixed and mobile broadband plans,by country income group,201522.71.5 Smartphone penetration,by income group,region,and type of connection,201522.81.6 Rural and urban households with a computer or tablet,by country income group,various years.91.7 Use of bandwidth per user,by country income gro

26、up,201522.91.8 Median speed of fixed and mobile downloads,by country income group,2019 and 2023.101.9 Fixed and mobile broadband traffic per capita,by country income group,201522.10vIII D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 1.10 Impact of COVID-19 on patterns of smartph

27、one use,by type of app,201922 .111.11 Growth in app downloads,by country and type of app,201922.121.12 Effect of lockdown stringency on downloads and total time spent on apps,by category of app,202022.121.13 Share of firms with a computer or internet connection across countries,201922.131.14 Use of

28、website,social media,and cloud computing for business purposes in select countries,201922 .141.15 Use of technologies applied to payment methods in select countries,201922.151.16 Use of technologies applied to sales methods in select countries,201922.161.17 Share of firms investing in digital soluti

29、ons during COVID-19,by firm size,202022.171.18 Predicted probability of using digital solutions over time,by size of firm and sector,202022.181.19 Association between firms capabilities and digital investment and use,202022 .181.20 Association between firms resilience in sales and digital investment

30、 and use,202022 .192.1 Key segments in the digital sector.242.2 Global annual patent publications,by field of technology,19802020.252.3 Value added of ICT manufacturing and ICT services,by subsector,200022.262.4 Value added growth in ICT manufacturing and services,select countries,201522.272.5 Inten

31、sity of ICT inputs,by sector,2000 and 2020.272.6 Intensity of IT services inputs in select industries,by country income group,2000 and 2020.282.7 ICT sector as a share of employment,by subsector,200022.282.8 Size and growth of IT services and gender ratio in IT services,200022.292.9 Global exports o

32、f ICT goods,by category,200021.322.10 Top 10 exporters of ICT goods,200021.322.11 Economies with the largest changes in share of exports of global ICT goods,201521.332.12 Global export of ICT services,by category,200522,and top 10 exporters of ICT services,201022.342.13 Global services exports,by ca

33、tegory,2022.352.14 Growth of IT services exports,by country income group,201922 .35 C O N T E N T S Ix2.15 Share of venture capital deals received,by subsector and country income group,201722.372.16 Share of domestic apps among the 100 most downloaded apps,201522.402.17 Probability of being among th

34、e top 50 most downloaded apps in foreign markets,2022.402.18 Geographic distribution of users,by category of app and country income group of the app publisher,2022.413.1 Global mobile coverage,200022 .463.2 Projected growth in data traffic,by device and technology,201727.463.3 Amount and regional di

35、stribution of global investment in telecom networks,201721.483.4 Number and distribution of IXPs,by country income group and region,2022.523.5 Average number of members and traffic per IXP,by country income group and region,2022 .533.6 Top companies and applications,by internet traffic generated,202

36、2.533.7 Retail price and monthly consumption of internet data in low-and lower-middle-income countries,202122.543.8 Number and distribution of connected data centers,by country income group and region,201822.563.9 ICT sector greenhouse gas emissions and electricity consumption,2020.583.10 Data cente

37、r consumption of electricity in Ireland and the Netherlands.583.11 Volume of global renewable power purchase agreements,by sector and top 9 corporate purchasers of renewable energy,2021.593.12 Price of electricity and grid emissions factor,various countries,2021.59B3.3.1 Electricity wheeling.604.1 T

38、he concept of digital public infrastructure.684.2 The India stack.694.3 G-20 DPI outcomes in 2023.70B4.2.1 Theory of change .72B4.3.1 Sample Fayda card issued by the Government of Ethiopia.75B4.3.2 Screenshot of a menu of public services available through the FranceConnect system.75B4.3.3 Screenshot

39、 of a login page for eFaas.764.4 Gaps in access to official identification,by demographics and country income group,2021 .774.5 Adoption of digital financial services .794.6 Number of payment methods used during the COVID-19 response,by number of countries,as of May 2021.80 x D I G I T A L P R O G R

40、 E S S A N D T R E N D S R E P O R T 2 0 2 3 5.1 Number of model parameters for significant published AIs,by domain and type of institution,19402020 .875.2 Automation and augmentation potential,by gender and country income group.90Map2.1 Absolute change in the number of investment deals,202022 versu

41、s 201719 .37TablesB3.1.1 Golden rules for achieving widespread connectivity.50A.1 Description of data used from the Firm Level Adoption of Technology Survey.108A.2 List of countries in the Business Pulse Survey used in this report.109A.3 Digital adoption.112A.4 Digital sector.124A.5 Digital infrastr

42、ucture.137 xiForewordDevelopment has entered a new era in which digitalization is profoundly transforming our economies and societies.Significant advances in digital technologies have driven dramatic changes,from the way we communicate and access information to how we conduct business and interact w

43、ith the environment.Digitalization has opened new avenues for innovation,efficiency,and inclusion,bringing tangible benefits and new possibilities to individuals,organizations,and nations.Embracing digitalization is no longer a choice but a necessity,as it holds the foundation and potential to shape

44、 a more inclusive,resilient,and sustainable world for generations to come.When fast internet becomes available,the probability that an individual is employed increases by up to 13.2 percent,total employment per firm increases by up to 22 percent,and firm exports nearly qua-druple.Across Africa,3G co

45、verage has been linked to a reduction in extreme poverty of 10 percent in Senegal and of 4.3 percent in Nigeria.Analytics and data-driven decision-making can boost the sales of small and medium enterprises and help them to establish a competitive advantage.Digital technologies can reduce greenhouse

46、gas emissions by up to 20 percent by 2050 in the three highest-emitting sectors:energy,materials,and mobility.However,the progress and distributional impact of digitalization have been highly uneven within and across countries.The inherent characteristics of digital data and digital technologies als

47、o gener-ate new risks.In 2022,one-third of the global population remains offline.More than half of firms in Burkina Faso,Ethiopia,Ghana,and Senegal reportedly lack internet connection.Network effects and economies of scale and scope tend to concentrate information,profits,and power.Digital tech-nolo

48、gies have accelerated automation and displaced workers,while increasing gig work can bring risks to workers,including lack of social protection.Social media platforms and algorithms have contributed to the spread of misinformation and extremism,making society even more divisive.Digital data and tech

49、nologies also create new privacy and security vulnerabilities.The explosive growth of data and massive digitalization is resulting in significant increases in electricity consump-tion and greenhouse gas emissions.As a result,the World Bank is launching the Digital Progress and Trends Report,which tr

50、acks the global progress of digitalization,summarizes emerging technology and market trends,and high-lights policy shifts and debates.The report puts a focus on low-and middle-income countries.It seeks to open dialogue and motivate action among relevant audiences to help to sustain political commitm

51、ent to closing the digital divide.The report also brings global attention to successful expe-rience as well as to areas where efforts will need to be redoubled.xII D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 Unprecedented growth in data and analytical capabilities,including c

52、loud and artificial intelligence(AI),is propelling digitalization to a new era.This inaugural edition highlights two emerging trends:the emergence of the digital public infrastructure(DPI)concept and advances in AI technologies and their implications.DPIthe combination of digital platforms for ident

53、ity,payments,and data sharinghas become foundational for accessing public and private sector services by individuals and firms.The latest breakthroughs in AI technologies have sparked widespread excitement as well as unease.It is critical for the global community,including low-and middle-income coun

54、tries,to work together to carve out a new development path to prepare for the AI disruption.Axel van Trotsenburg Senior Managing DirectorThe World Bank xiiiAcknowledgmentsDigital Progress and Trends Report 2023 was prepared by a World Bank team led by Yan Liu,under the guidance of Christine Zhenwei

55、Qiang,director for the Digital Development Global Practice.The core team comprised Rami Amin,Hans Christian Boy,Jieun Choi,Saloni Khurana,Yan Liu,Jonathan Marskell,Michael Minges,Anshuman Sinha,and Henry Stemmler,all from the Digital Development Global Practice.Key inputs were received from Rong Che

56、n,Julia Clark,Georgina Marin,and Minita Varghese from the Digital Development Global Practice;Xavier Cirera,Ana Goicoechea,Silvia Muzi,Sara Oliveira,and Nithya Srinivasan from the Finance,Competitiveness,and Innovation Global Practice;and Cem Dener and Kimberly Johns from the Governance Global Pract

57、ice.The team is grateful to the many reviewers who provided thoughtful insights and guidance at various stages of the reports preparation.External peer reviewers include Vivien Foster(principal research fellow,Imperial College London;former chief economist for the infrastructure vice-presidency,Worl

58、d Bank),William Lehr(research associate,Massachusetts Institute of Technology),and Anna M.Polomska-Risler(Strategic Partnerships at the United Nations/International Telecommunication Union Broadband Commission).Internal peer reviewers include Mary Hallward-Driemeier,Timothy Kelly,Aart Kraay,Gaurav N

59、ayyar,and Davide Strusani.Additional written comments were received from Adele Moukheibir Barzelay,Carolina Snchez-Pramo,and David Satola.The team particularly appreciates the guidance and support of Guangzhe Chen,Pablo Fajnzylber,Sebastian-A Molineus,and Stephane Straub.Special thanks are due to An

60、drea Barone,Jerome Bezzina,Julia Clark,Vyjayanti Desai,Doyle Gallegos,Nicole Klingen,Jonathan Marskell,Maria Isabel Neto,Michel Rogy,Sandra Sargent,Rajendra Singh,Randeep Sudan,Casey Torgusson,and Mahesh Uttamchandani for their helpful comments and suggestions.The team thanks the following organizat

61、ions for participating in the Digital Industry Leader Survey and providing valuable inputs:Alphabet,Atos Africa,Bureau Veritas,Business Finland,Meta,Microsoft,Mouvement des Entreprises de France International(MEDEF International),MTN Group Limited,Orange,Secure Identity Alliance,Sofrecom,and Visa.Th

62、e report was funded by the World Bank and the Digital Development Partnership Trust Fund,which offers a platform for digital innovation and development financing,bringing public and private sector partners together to advance digital solutions and drive digital transformation in low-and middle-incom

63、e countries.xIv D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 The communication and dissemination efforts were led by Kelly Alderson and Breen Byrnes.Elizabeth Forsyth and Matthew Robert Zoller edited the report.Caroline Polk coordinated and oversaw its production.Bill Praglusk

64、i,Critical Stages,LLC,designed the reports cover and interior.Datapage supplied typesetting services.Dalia Ali provided the team with resource management and administrative support.Finally,the team apologizes to any individuals or organizations inadvertently omitted from this list.It is grateful for

65、 the help received from all who contributed to this report,including those whose names may not appear here.xvExecutive SummaryThe new series Digital Progress and Trends Report adopts a holistic framework of digitalization,with selective topics examined in depth in each edition.The framework,which is

66、 described in figure ES.1,includes both the production and the adoption sides of digital technologies and their interactions.1 Box ES.1 explains how the series supports global efforts to study the progress,gaps,benefits,and risks of digitalization.The benefits and risks are also interconnected and r

67、eflect the trade-offs and complexity of digitalization:innovation and growth can be accompanied by high concentration and reduced market contestability.Efficiency gains and lower costs for large businesses may mean higher inequality and polarization.Digitalization can create jobs and improve inclusi

68、on,but it also results in power asymmetry and makes it easier for governments and companies to monitor and control individuals.Digital innovation creates new possibilities for climate change mitigation and adaptation but expands the carbon footprint of the information and communication technology(IC

69、T)sector.Cybersecurity,privacy,and misinformation are also major risks that can undermine trust in the digital space and circumvent the gains from digitalization.Countries need to maximize the benefits while minimizing the risks of digitalization.Digitalization for inclusive,resilient,and sustainabl

70、e developmentAdoption of digital technologiesAdvances in digital infrastructure,technologies,and data analyticsBroadband and data infrastructureShapes the direction of investmentsDrives digital transformationData platforms and DPIICT sectorMaximizeMinimizeInclusionJob creationInequalityPolarizationE

71、fciencyCost reductionControl|CybersecurityPrivacy|MisinformationInnovation|SustainabilityEconomic growthConcentrationMarket contestabilityBeneftsRisksFIGURE ES.1 Report frameworkSource:Based on World Bank 2016.Note:DPI=digital public infrastructure;ICT=information and communication technology.xvI D

72、I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 BOx ES.1 About this reportThe report adds to global efforts to study the progress,gaps,benefits,and risks of digitalization in two ways.1.By compiling,curating,and analyzing data from diverse sources to present a compre-hensive pictur

73、e of digitalization in low-and middle-income countries,including in-depth analyses on understudied topicsDigitalization is cross-cutting and encompasses different dimensions.Data on digitalization are scattered in many sources with varying visibility and accessibility.The differences in the defini-t

74、ion,measurement,and update frequency of indicators further hamper over-time and cross-country comparisons.The rich data compiled and curated by the report team greatly expand the scope of synthe-sis,shed light on both the production and adoption sides of digitalization,and present a multi-faceted pi

75、cture of the digital landscape in the world,with a focus on low-and middle-income countries.In its inaugural issue,the report uses a range of data sources,including the World Banks Findex data,Identification for Development data,and household and business survey data,among oth-ers,to examine the ado

76、ption of digital technologies by individuals and businesses.It explores the dynamics of digital markets based on venture capital investment data and app performance data.It also uses data compiled from various sources to analyze trends in investments in broad-band and data infrastructure,electricity

77、 consumption,and greenhouse gas emissions from digi-tal infrastructure.Further,the report team has curated a new information and communication technology(ICT)sector data set to provide more accurate and comprehensive information on value added and employment in the ICT sector.a2.By developing insigh

78、ts on policy opportunities,challenges,and debates and reflecting the views of stakeholders and World Bank operational experiencesThe report highlights key policy opportunities,challenges,and debates related to digitaliza-tion through regulatory data analysis,literature review,and stakeholder consult

79、ations.It reflects inputs from a variety of stakeholders,including leading players in the private sector,partner organizations,policy makers,and academia.It also reflects and incorporates insights and learn-ing from the World Banks country engagements and operations in more than 100 countries,where

80、appropriate.Report structureAs an annual series,the Digital Progress and Trends Report aims to maintain consistency and com-parability in its structure and tracking of progress as well as flexibility to adjust methodologies in light of new trends and available data.Each edition will have two parts.P

81、art 1 will include two to three chapters on digitalization progress.These chapters will be quantitative in nature,enabled by primary and secondary data sets collected and compiled by the World Bank and partner orga-nizations.Part 2 will feature one to two chapters on trends with strategic and real-t

82、ime relevance.The topics covered in both parts will vary in each edition to capture timely developments,data,and debates.A data appendix will focus on a set of core indicators,which may be expanded as new,comparable data become available.a.The report includes a data appendix describing the databases

83、 used and showing the latest value of core indicators for all countries,regions,and country income groups.E x E c u t i v E S u m m a r y xviiMain findingsWhile digital adoption is accelerating,the digital divide continues to widen,exacerbating the poverty and productivity divide.Internet use is spe

84、eding up in middle-income countries,but low-income countries are falling further behind.The world gained 1.5 billion new internet users during 201822.The number of internet users reached 5.3 billion in 2022,representing two-thirds of the global population.The COVID-19 pandemic cata-lyzed the already

85、 accelerating growth in internet users in middle-income countries.However,only one out of four individuals in low-income countries used the internet in 2022.The stark divide in fixed broadband penetration between richer and poorer countries has widened as the pandemic boosted penetration in high-inc

86、ome and middle-income countries but less so in low-income countries.Fixed broadband subscriptions per 100 persons were above 30 in high-income and upper-middle-income countries,but only 4.4 in lower-middle-income countries and 0.5in low-income countries in 2022.Larger gaps are forming in internet sp

87、eed and data use,and the poor quality of internet services is hampering firms digital transformation in some low-and middle-income countries.Internet speed has risen much faster in high-income countries than in middle-income ones since 2019 and has even fallen slightly in low-income countries.In 202

88、3,median fixed and mobile broadband speeds are 10 and 5 times faster,respectively,in high-income countries than in low-income countries.The pandemic led to a surge in data traffic,driven by video streaming,which accounted for two-thirds of global internet traffic in 2022.The surge occurred primarily

89、 in high-income and upper-middle-income countries,widening the gap with lower-middle-income and low-income countries.In 2022,median mobile broadband traffic per capita was more than 20 times higher in high-income countries than in low-income countries,and median fixed broadband traffic per capita wa

90、s more than 1,700 times higher.The pandemic and consequent mobility control measures induced substantial and persistent changes in peoples behavior.The use of business,education,finance,medical,health,and shopping apps got a significant boost from mobility restrictions during the pandemic.The increa

91、se was driven mainly by a surge in new users.Lockdown stringency during the pandemic was a strong predictor of higher downloads,greater use of business,education,games,and health apps,and lower use of travel apps.The effects on total time spent can persist even one year after the initial mobility re

92、strictions.Firms with greater digital readiness before the pandemic and those that invested in digital solutions during the pandemic showed greater resilience.While the pandemic drove firms of all sizes online,large firms led investments in digital solutions.From April 2020 to December 2022,the perc

93、entage of firms investing in digital solutions doubled from 10 percent to 20 percent for micro firms(04 employees)but tripled from 20 percent to 60percent for large firms(more than 100 employees).Firms prepandemic digital readiness2 and management practices3 predicted a higher probability of investi

94、ng in and using digital solutions during the pandemic.Firms with greater digital readiness before the pandemic and those that invested in digital solutions during the pandemic also showed greater resilience in sales.xvIII D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 The digita

95、l sector is driving innovation,economic growth,and job creation,generating positive spillovers on the broader economy.The digital sector continues to be an engine of innovation and growth.However,lower-income coun-tries have yet to exploit the productivity spillovers from information technology(IT)s

96、ervices.Global patent publications in computer technology soared 27-fold between 1980 and 2021.Patent publications in other ICT fields also surged more than 10-fold,compared to just 2-fold in other fields of technology.The IT services segment was the most vibrant and fastest-growing segment of the g

97、lobal economy over the past two decades.The compound annual growth rate of global value added and employ-ment for IT services reached 8 percent and 6.7 percent,respectively,during 200022,far outstripping the5.1percent and 1.2 percent growth of the global economy.IT services were increasingly used as

98、 intermediate inputs in other sectors.From 2000 to 2020,IT services contributed to a much larger share of total intermediate inputs across all sectors.The input intensity of IT services almost doubled in high-income and upper-middle-income countries during 200020 but did not grow at all in lower-mid

99、dle-income countries.Most countries experienced robust job creation in IT services.Global employment in IT services qua-drupled from 8 million in 2000 to 32 million in 2022.China,Israel,Malaysia,Nigeria,the Philippines,Viet Nam,and several Central and Eastern Europe countries(Hungary,Poland,and Roma

100、nia)had the fastest employment growth thanks to the burgeoning local IT services industry and roaring exports.Women made up 29 percent of total employment in the male-dominated IT services industry in 2020,up from 23 percent in 2010.Albania,Bangladesh,Brunei Darussalam,Cyprus,the Arab Republic of Eg

101、ypt,Iceland,the Islamic Republic of Iran,the Kyrgyz Republic,Tanzania,and Uganda achieved significant progress in bringing more women into the IT services workforce.Diversification of the global value chain and surging demand in IT and IT-enabled services are creating new opportunities for countries

102、 to pursue export-led growth.Intensifying geopolitical tensions between China and the United States,the pandemic,and the war in Ukraine have galvanized multinational corporations to accelerate diversification of their global value chain,creating opportunities for other countries close to major marke

103、ts and suppliers.India and countries in the Association of South East Asian Nations have been among the biggest beneficiaries.The IT services segment was the most dynamic category of international trade for the past decade,creating an export-led growth pathway for countries to expand and diversify t

104、heir economies.During 201022,IT services grew by 12 percent annually,surpassing all other service categories.By 2022,it was the third largest category of service exports,right after transport and travel.At the same time,homegrown digital firms are springing up in low-and middle-income coun-tries,fil

105、ling important market gaps,driving innovation,and often generating more spillovers than foreign firms.Many low-and middle-income countries have received an influx of venture capital funding since 2020.Most venture capital deals in low-and middle-income countries are in e-commerce,fintech,health,educ

106、ation,and entertainment.India minted 50 new digital unicorns4 during 202022,up from just 4 unicorns during 201719.Digital unicorns also popped up in Argentina,Brazil,Chile,Colombia,Egypt,Indonesia,Malaysia,Mexico,Nigeria,the Philippines,Senegal,South Africa,Trkiye,and Viet Nam.The app market is beco

107、ming more local and less global,and this trend has accelerated since the pan-demic.Countries with a large domestic market,unique language,strong cultural identity,and prolific IT talents have enabled and incentivized local firms to cater to their home markets.From 2015 to 2022,domestic apps made up

108、an increasing share of the 100 most downloaded apps in 54 of 63 economies.Argentina,Brazil,Chile,India,Indonesia,the Russian Federation,Saudi Arabia,South Africa,Trkiye,Ukraine,and the United Arab Emirates experienced the largest increase in the share of domestic apps between 2015 and 2022.E x E c u

109、 T I v E S u m m A R y xIx Nonetheless,the growth potential of digital firms in low-and middle-income countries remains to be seen.While localization has been key to their success in home markets,their products and business models may be less relevant or transferrable to foreign markets.For US apps,

110、foreign users made up four out of five users in 2022.The share of foreign users of most apps developed by low-and middle-income countries is less than 20 percent.Unprecedented growth in data and analytical capabilities is propelling digitalization to a new era,with profound implications for low-and

111、middle-income countries.Low-and middle-income countries need to expand and upgrade their broadband infrastructure to handle the explosive growth in data and enable broader digitalization.The volume of data created,stored,transferred,and used globally has been growing exponen-tially from 2 zettabytes

112、5 in 2010 to an expected 120 zettabytes in 2023;it is forecast to exceed 180 zettabytes by 2025(Hack 2021).Investment priorities in the telecommunication sector are shifting to higher-speed access infrastructure such as fiber optic cable to the premises,next-generation mobile network connectivity,an

113、d wireless technologies.GSMA forecasts that mobile operators alone will invest more than US$600 billion between 2022 and 2025,of which 85 percent will be for 5G.Governments can catalyze private investment and improve the efficiency of telecommunication investment by phasing out legacy 2G and 3G netw

114、orks,reducing spectrum costs,and promoting infrastructure sharing.To reduce spectrum costs,governments can allow operators to use unallocated spectrum for free or low cost,make spectrum technology and service neutral,6 and allow operators to reuse their current spectrum for 5G.Governments that have

115、not yet allocated frequency for 5G should do so,particularly the new mmWave band,which can offer high-speed indoor coverage.Aggregation of mobile and unlicensed Wi-Fi spectrum will also help to increase network throughput.Regulators need to enhance institutional capacity to secure and release enough

116、 spectrum,including globally harmonized pioneer bands,while avoiding the risk of spectrum fragmentation that prevents 5G from delivering on the performance desired.Infrastructure sharing of wireless base station towers and cable ducts lowers costs and reduces green-house gas emissions.Regulatory fra

117、meworks that encourage network sharing can substantially reduce the costs for 5G.Data infrastructureinternet exchange points(IXPs),data centers,and cloud computinghas become vital to the digital economy.Investment is also needed in middle-mile infrastructure7 to transmit,store,and exchange data,espe

118、cially IXPs,connected data centers,8 and cloud computing.As of 2022,low-and middle-income countries accounted for less than half of total public IXPs and one-quarter of connected data centers,respectively.To lower costs and improve quality,IXPs need to attract major content and cloud service compani

119、es to become members.Among lower-middle-income and low-income countries in 2022,the retail price for 1 gigabyte per month in countries that have IXPs with leading content providers was less than one-fifth of that in countries that do not have an IXP.Mobile data consumption was nearly three times hig

120、her.Governments in low-and middle-income countries should liberalize the IXP environment and ensure that internet service providers(ISPs)with significant market power do not discourage the use of IXPs(Qassrawi 2022).To encourage private investment in data centers,governments need to create a favorab

121、le investment climate and introduce targeted financial and other instruments,such as state aid,venture capital fund-ing,public-private co-financing mechanisms,or tax incentives.These instruments can vary depending on a data centers location,size,energy efficiency,and environmental footprint.xx D I G

122、 I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 Aggregating demand at the regional level and bringing together stakeholders to achieve economies of scale might also be a potential solution for lower-income countries to attract private sector investment.Regional harmonization of regula

123、tions for data security,protection,and sovereignty could help encour-age major cloud providers to establish a presence in low-and middle-income countries.Governments could also promote cloud services through the adoption of cloud technologies for their own use.The emergence of digital public infrast

124、ructure(DPI)concept reflects a paradigm shift from using siloed vertical approaches for digitalization to building cross-cutting horizontal enablers.“DPI”is a new term referring to the basic capabilities that are building blocks for developing digi-tal services at a societal scale.DPI is the interme

125、diate layer between physical infrastructure(for example,broadband and data centers)and sectoral applications(for example,social protection and e-commerce).The most common types of DPI are platforms and systems for digital identification,digital payments,and data sharing.DPI rose in prominence during

126、 the COVID-19 pandemic.The countries with elements of DPI in place reached three times more beneficiaries with emergency cash transfers.Countries with good DPI also were able to keep government services,commerce,hospitals,schools,and other operations function-ing through online channels.Globally,850

127、 million people still lack any form of official identification.Five billion people live in countries without digital identification that can be used for secure online access to public and private sector services.Only 57 percent of adults in low-and middle-income countries made or received some sort

128、of digital payment in 2021,and only 37 percent made a merchant payment.AI development has arrived at a new stage,attaining a level of sophistication previously unimaginable.The ability of large language models to interpret natural language prompts correctly and generate completely original text,audi

129、o,image,and video content that is indistinguishable from human-made content has propelled them to the forefront of AI research and commercialization(Brown et al.2020).New generative AI start-ups have been entering the market at a swift pace,with content generation and generative AI infrastructure ga

130、ining the most traction from investors.In the first half of 2023,the space saw US$14.1 billion in equity funding(including US$10 billion to OpenAI),more than five-fold compared to full-year 2022.AI has huge potential to accelerate productivity growth and bring vast benefits to the global economy and

131、 society,but it also presents new risks and challenges,especially for low-and middle-income countries.AI holds huge potential to help low-and middle-income countries to tackle issues in crucial areas,notably in agriculture,health care,education,energy,financial inclusion,climate resilience,and insur

132、ability.In Mexico,companies like Clnicas de Azcar are using AI to analyze data and improve health out-comes for thousands of at-risk diabetic patients(Sonneborn and Graf 2020).In Africa,companies like Azuri Technologies are using AI to optimize power consumption by learning home energy needs and adj

133、usting power output accordingly(automatically dimming lights,slowing fans,or managing how quickly devices are charged).However,AI could potentially widen the gap between rich and poor countries.Digital technologies including AI tend to give rise to natural monopolies,creating a small set of supersta

134、r firms that are headquartered in a few“superstar countries”and reaping all of the rents associated with the develop-ment of AI.Rich countries also have stronger incentives and better complementary skills and institu-tions to adopt AI than poor countries.AI could deteriorate the terms of trade and d

135、evalue the comparative advantage of low-and middle-income countries,eventually reversing the convergence in standards of living between rich and poor countries.E x E c u T I v E S u m m A R y xxIThe AI era calls for a new playbook for policy making and closer coordination across stakeholders and reg

136、ulatory and jurisdictional spheres.There is a lot of uncertainty about the direction,pace,scale,and effect of changes brought by AI.It is critical for the global community,including low-and middle-income countries,to shape the direction of AI innovations jointly,to coordinate the pace and scale of t

137、heir applications,to forecast,monitor,and assess the impacts,and to prepare to ameliorate the adverse effects.While some common foundational principles guide AI regulation,distinct variations exist in the specific approaches and priorities adopted by different countries.The European Union has opted

138、for a structured,risk-based legislative framework,with the AI Act proposing exhaustive regulations governing AI applications across diverse sectors.The United States has adopted a more diverse,flexible approach to AI regulation,characterized by a combination of soft law,self-regulation,responsible u

139、se,and legislation at various levels within different domains.Multistakeholder efforts,such as the Rome Call on AI Ethics and the United Nations Educational,Scientific,and Cultural Organizations Recommendation on the Ethics of AI,have also sought to maximize the synergy of foundational research,tech

140、nological advancements,standardized norms,and balanced regulations in fostering responsible deployment of AI.Regulatory strategies must navigate the complexities and potential biases inherent in AI,addressing the juxtaposition of economic growth,efficiency,transparency,privacy,national security,and

141、societal impacts.Regulatory fragmentation may hinder AI innovation and development,create enforcement gaps and trade barriers,lead to regulatory arbitrage,and diminish the effectiveness of such regulations.Rapid advances in AI also highlight the urgency for low-and middle-income countries to build d

142、igital infrastructure,develop digital skills,and carve out new development paths to prepare for the disruption.A range of countries,including Egypt,Ghana,Kenya,Mauritius,Rwanda,South Africa,and others,have initiated efforts to develop AI policies and strategies,with a heavy focus on building digital

143、 infrastructure,developing AI skills,and adopting AI solutions.Such efforts echo the views of industry leaders,who emphasize the urgency for low-and middle-income countries to invest in digital infrastructure and prepare the workforce for the disruptions that AI may bring.Policy makers in low-and mi

144、ddle-income countries can intentionally steer the direction of AI adoption toward labor augmentation;leverage AI to improve the efficiency and effectiveness of taxation,redistribution,and social protection;rethink their sectoral strategies;and explore services-led growth pathways.Notes1.“Digital tec

145、hnologies”often refers to electronic tools,systems,devices,and resources that generate,store,or process data.“Digitalization”is the use of digital technologies and data as well as the inter-connection that results in new activities or changes to existing activities(OECD 2019).2.Digital readiness is

146、measured as the number of pre-COVID-19 digital practices applied out of three indicators:online sales or payment,online social media,and use of enterprise resource planning soft-ware and systems.3.Management practices are measured as the number of structured management practices applied out of three

147、 indicators for firms:targets,advertisements,and promotion of employees.4.Unicorns are privately held start-up companies with a value of more than US$1 billion.5.One zettabyte is 270 bytes.It is equal to 1 trillion gigabytes.6.Technology-neutral licenses enable spectrum to be used efficiently by mob

148、ile operators rather than being tied to declining technologies and services.The most important development is the ability to refarmrepurposebands so that they are used simultaneously for several technologies,including 4G and 5G.This repurposing allows for the introduction of newer technologies in li

149、ne with increas-ing demand for mobile broadband,while at the same time supporting legacy users.xxII D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 7.The mile framework is useful for understanding the telecommunication value chain,which stretches from the point where the internet

150、 enters a country(the first mile),passes through that country(the middle mile),and eventually reaches the end user(the last mile),including certain hidden elements in between(the invisible mile).Refer to World Bank(2016).8.Connected data centers house the computing and networking equipment of tenant

151、s and include inter-connection facilities.Connected data centers serve a variety of tenants,including companies from a range of industries,governments,ISPs,content and cloud providers,as well as IXPs.ReferencesBrown,Tom B.,Benjamin Mann,Nick Ryder,Melanie Subbiah,Jared Kaplan,Prafulla Dhariwal,Arvin

152、d Neelakantan,Pranav Shyam,Girish Sastry,Amanda Askell,et al.2020.“Language Models Are Few-Shot Learners.”arXiv preprint arXiv:2005.14165.Hack,Ulrike.2021.“Whats the Real Story behind the Explosive Growth of Data?”Redgate(blog),September 8,2021.https:/www.red- for Economic Co-operation and Developme

153、nt).2019.“Going Digital:Shaping Policies,Improving Lives.”OECD,Paris.https:/www.oecd.org/digital/going-digital-synthesis-summary.pdf.Qassrawi,Zaher.2022.“Internet Exchange PointsBeyond Configuration Issues.”RIPE Labs,March 24,2022.https:/ Lana Graf.2020.“How AI Can Help Developing Countries Rebuild

154、after the Pandemic.”Digital Development(blog),September 16,2020.https:/blogs.worldbank.org/digital-development/how-ai-can-help-developing-countries-rebuild-after-pandemic.World Bank.2016.World Development Report 2016:Digital Dividends.Washington,DC:WorldBank.https:/elibrary.worldbank.org/doi/abs/10.

155、1596/978-1-4648-0671-1.xxiiiAbbreviationsAI artificial intelligenceAPI application programming interfaceASEAN Association of South East Asian NationsBPO-ITES business process outsourcing and IT-enabled services BPS Business Pulse Survey CAGR compound annual growth rateDPI digital public infrastructu

156、reEADC East Africa Data CenterEBIA Emerging Brazilian Artificial Intelligence StrategyFAT Firm Level Adoption of Technology FDI foreign direct investmentGDP gross domestic productGNI gross national incomeGTMI GovTech Maturity IndexG2P government-to-person HIC high-income countriesICT information and

157、 communication technologyICTD ICT Sector Data SetID identification documentID4D Identification for DevelopmentIoT Internet of Things ISP internet service providerIT information technologyIXP internet exchange pointKIXP Kenyan Internet Exchange PointLIC low-income countriesLLM large language moduleLM

158、IC lower-middle-income countriesOECD Organisation for Economic Co-operation and DevelopmentOTT over the top PPP purchasing power parityPV photovoltaicQoQ quarter over quarterR&D research and developmentSDG Sustainable Development Goal tCO2e tons of carbon dioxide equivalentxxIv D I G I T A L P R O G

159、 R E S S A N D T R E N D S R E P O R T 2 0 2 3 TESPOK Technology Service Providers of KenyaTiVA Trade in Value-AddedTWh terawatt-hourUMIC upper-middle-income countriesUN United NationsVA value addedVC venture capitalVPN virtual private network 1PART 1Progress 31Digital Adoption:Accelerating Postpand

160、emic,yet a Widening DivideYan Liu,Rami Amin,and Henry StemmlerKEY MESSAGES The world gained 1.5 billion new internet users from 2018 to 2022,with accelerated growth in middle-income countries amplified by the COVID-19 pandemic.However,low-income countries are falling behind,with only one in four peo

161、ple using the internet in 2022.Affordability continues to be a main barrier to internet use.Median fixed broadband prices inlow-income countries accounted for one-third of monthly gross national income per capita in2022.Eventhe cheapest smartphone accounts for more than 14 percent of annual income f

162、or persons living on less than US$2 a day.Larger gaps are forming in internet speeds and data use.In 2023,median fixed and mobile broadband speeds in high-income countries are 10 and 5 times faster,respectively,than speeds in low-income countries.Median mobile broadband traffic per capita in high-in

163、come countries was more than 20 times higher than traffic in low-income countries,and median fixed broadband traffic per capita was more than 1,700 times higher in 2022.The COVID-19 pandemic and consequent mobility control measures induced some durable changes in peoples habits.Time spent on busines

164、s,education,finance,medical,health,and shopping apps increased significantly during and after the COVID-19 pandemic.Firms digital readiness and management practices before the pandemic predicted a higher probability of investment in and use of digital technology during the pandemic.Firms with greate

165、r digital readiness before the pandemic and firms that invested in digital solutions during the pandemic also showed greater resilience in sales.IntroductionDigital technologies and internet connectivity are transforming lives,creating opportunities,and advancing economic development around the worl

166、d.For households and individuals,digital technology has significantly improved access to timely information and lowered transaction costs,boosting educational outcomes,labor force participation,income,consumption,and welfare(Aker2010;Bahia et al.2020;Derksen,Michaud-Leclerc,and Souza 2022;Hjort and

167、Poulsen 2019;Jensen 2007;Rodriguez-Segura 2022;Viollaz and Winkler 2022).For businesses,digital technology can improve decision-making,increase efficiency,facilitate innovation,and expand markets(Bar-Gill,Brynjolfsson,and Hak 2023;Bloom,Sadun,and Van Reenen 2012).4 D I G I T A L P R O G R E S S A N

168、D T R E N D S R E P O R T 2 0 2 3 Despite the potential of digital technologies to create enormous socioeconomic benefits,their uneven deployment,adoption,and use have created so-called“digital divides”across individuals,businesses,and countries.For instance,in Africa,mobile internet covers 84 perce

169、nt of the population,but only 22 percent make use of it(Begazo,Blimpo,and Dutz 2023).Thisunderutilization is driven by significant barriers,including high costs of devices and services,limited digital skills,quality of service,and relevance,including the perception of relevance,among other factors s

170、uch as cultural attitudes and concerns about digital trust and safeguards.Among enterprises in low-and middle-income countries,high costs,lack of digital skills,and weak digital infrastructure are preventing the productive use of digital technologies(Atiyas and Dutz 2021;Cirera,Comin,and Cruz 2022).

171、Vast digital divides also exist across countries.Morethan 90 percent of people in high-income countries used the internet in 2022,compared with 25 percent in low-income countries.This chapter highlights trends in digital adoption and identifies remaining barriers to adoption,placing particular focus

172、 on low-and middle-income countries,where the lingering presence of well-known obstacles to adoption are the most profound.The chapter also analyzes how the COVID-19 pandemic has affected the patterns of internet use and examines how firms have adopted and invested in digital technologies.It provide

173、s high-level policy insights on how to promote digital adoption,close usage gaps,and mitigate emerging divides in the quality of adoption.The share of Internet users in middle-income countries is moving closer to that in high-income countries,while the share in low-income countries continues to lagT

174、he world gained 1.5 billion new internet users between 2018 and 2022,as the COVID-19 pandemic amplified and accelerated growth in low-and middle-income countries.The number of internet users reached 5.3 billion in 2022,representing two-thirds of the global population.In 2020,the first year of the CO

175、VID-19 pandemic,the share of global population using the internet increased by 6 percent(500 million people),the highest jump in history,as mobility restrictions drove many activities online(refer to figure 1.1,panel a).While growth slowed in 2021 and 2022,it remained faster than most years during t

176、he past two decades,as vast populations in both low-income and lower-middle-income countries began using the internet(refer to figure 1.1,panel b).Middle-income countries,especially India,drove the surge in internet users.In 2018,only one in five Indians used the internet.However,between 2018 and 20

177、22,India recorded a staggering 170percent growth in internet users.Contributions to the surge included the rise in internet lit-eracy among women,cheaper mobile data prices,pandemic restrictions,and government initiatives like the Unified Payments Interface and the Digital India Initiative.1 Consequ

178、ently,as of 2022,more than half of Indians were active internet users.Mongolia experienced even faster growth,as more than one-third of its population became internet users during 201921.In addition,since 2018,the Arab Republic of Egypt,Ghana,the Lao Peoples Democratic Republic,and Thailand also bro

179、ught a quarter of their population online.COVID-19 has significantly narrowed the gap between middle-income and high-income countries in the share of internet users,although low-income countries continue to lag.In 2022,92percent of the population in high-income countries used the internet,up from 87

180、 percent in 2018.At the same time,the share of internet users grew much faster in middle-income countries,narrowing the gap with high-income countries.By 2022,the share of internet users in upper-middle-income countries reached 79 percent,while the share in lower-middle-income countries reached 56 p

181、ercent,reflecting an increase of 16 percent and 25 percent,respectively,since 2018 D I G I T A L A D O P T I O N:A c c E L E R A T I N G P O S T P A N D E m I c,y E T A W I D E N I N G D I v I D E 5FIGURE 1.1 Internet users as a share of population,global and by country income group,19902022Sources:

182、World Development Indicators and International Telecommunication Union data(https:/www.itu.int/en/ITU-D/Statistics/Pages/stat/default.aspx).Note:HIC=high-income countries;LIC=low-income countries;LMIC=lower-middle-income countries;UMIC=upper-middle-income countries.030405060708

183、2002200620022Number of users(billions)%of population020406080620022%of populationa.Globalb.Income groupIndividuals using the internet(billion)%of populationHICUMICLMICLIC(refer to figure 1.1,panel b).Low-income countries also experienced accelerated growth

184、 of inter-net users,especially between 2021 and 2022,but the gap with high-income countries remains substantial.As of 2022,only one in four individuals in low-income countries used the internet(refer to figure 1.1,panel b).As such,2.7 billion people remain unconnected globally,mostly in low-and midd

185、le-income countries.Both high-income and middle-income countries have made significant progress since 2019 to narrow the gaps between urban and rural areas,age groups,and genders.However,in low-income countries,these gaps have widened,as most new internet users are young males in urban areas.Interne

186、t use is much more prevalent among individuals residing in urban areas than among those residing in rural areas.The urban-rural gap stands out as the widest of the three gaps(urban-rural,youth-adult,and male-female)across low-and middle-income countries,indicating broader eco-nomic disparities betwe

187、en urban and rural areas(refer to figure 1.2).The urban-rural gap is partic-ularly pronounced in lower-middle-income countries,with three-quarters of urban residents using the internet in 2022,compared with only two in five rural residents.Regardless of income group,youth between the ages of 15 and

188、24 are more likely to use the internet than the older population,although the gap is greatest in upper-middle-income countries.The gender gap has largely been closed in high-income countries but persists in lower-middle-income and low-income countries,where the share of men using the internet surpas

189、ses that of women by as much as 15percentage points.The stark divide in fixed broadband penetration between rich and poor countries widened as the pandemic boosted penetration in high-income and middle-income countries,but not in low-income countries.Fixed broadband connections provide high-speed in

190、ternet to a fixed location like a resi-dence or a business.In 2022,fixed broadband penetration reached 38 percent of the population in high-income countries.2 Upper-middle-income countries were close behind,with fixed broadband penetration standing at 31 percent in 2022.However,fixed broadband penet

191、ration was merely 4 percent in lower-middle-income countries and almost zero in low-income countries as of 2022(refer to figure 1.3,panel a)due to a lack of infrastructure and high prices.The nearly nonexistent 6 D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 FIGURE 1.2 Location

192、,age,and gender digital divides,by country income group,2019 and 2022Source:Original calculations for this publication using International Telecommunication Union data.Note:HIC=high-income countries;LIC=low-income countries;LMIC=lower-middle-income countries;UMIC=upper-middle-income countries.102935

193、2259540HICUMICLMICLICHICUMICLMICLICHICUMICLMICLICUrban-ruralYouth-adultMale-female%point gap20192022penetration of fixed broadband in lower-middle-income and low-income countries also implies very limited computer use by households and businesses,as deskto

194、p computers often use fixed broad-band based on its capacity to offer faster speed and lower latency than mobile broadband.Mobile broadband penetration is much higher than fixed broadband penetration and continues to rise steadily across income groups,although growth in low-income countries has been

195、 lacklus-ter.As mobile devices such as smartphones,tablets,and smartwatches become more powerful and versatile,mobile broadband has replaced fixed broadband as the main gateway to internet use.People are no longer tied to their home or office for online engagement.They can access informa-tion and al

196、l sorts of online applications while on the go.There were 4.4 billion unique mobile inter-net users in 2022,representing about three-quarters of the global population ages 15 and above.Furthermore,active mobile broadband subscriptions surpassed fixed broadband subscriptions glob-ally in 2008,and mob

197、ile subscriptions grew 15-fold between 2008 and 2022,reaching 6.9 billion in 2022.During the same time,fixed broadband subscriptions only doubled,reaching 1.4 billion at the end of 2022.Mobile broadband penetration has been growing at similar speeds in high-income and middle-income countries,while l

198、ow-income countries have failed to keep pace(refer to figure 1.3,panel b).As a result,the gaps in mobile broadband penetration between low-income countries and countries at other income levels have widened since 2015.Fixed broadband remains unaffordable for most people in low-income countries,while

199、mobile broadbands affordability continues to rise.Lack of fixed broadband remains an important barrier to universal connectivity,as most people in low-income countries still cannot afford it.In the past few years,median prices for mobile broadband have dropped across income groups,while median price

200、s for fixed broadband have stagnated.Furthermore,the median price for the cheapest fixed broadband plan has been stable in high-income and middle-income countries since 2020,but has trended upward in low-income countries.In 2022 the median price for a fixed broadband plan was 50 percent higher in lo

201、w-income countries than in countries at other income levels(refer to figure 1.4,panel a),accounting for nearly one-third of monthly gross national income per capita(ITU 2023).Conversely,the median price for a mobile broadband plan dropped across income groups in 2022,resuming a downward trend that w

202、as interrupted by the COVID-19 pandemic D I G I T A L A D O P T I O N:A c c E L E R A T I N G P O S T P A N D E m I c,y E T A W I D E N I N G D I v I D E 7FIGURE 1.3 Fixed and mobile broadband penetration,by country income group,201522a.Fixed broadband b.Mobile broadband 052001

203、9202020212022%of populationHICUMICLMICLIC05000022%of populationSource:International Telecommunication Union data.Note:HIC=high-income countries;LIC=low-income countries;LMIC=lower-middle-income countries;UMIC=upper-middle-income countries.FIGURE 1.4 Price of fixed an

204、d mobile broadband plans,by country income group,201522Source:Original calculations for this publication using International Telecommunication Union data.Note:The retail price of a fixed broadband basket includes 1 gigabyte and 5 gigabytes of data for 201517 and 201822,respectively.The retail price

205、of a mobile broadband basket includes postpaid computer-based data(1 gigabyte)for 201517,data-only mobile broadband(1.5 gigabytes)for 201820,and data-only mobile broadband(2gigabytes)for 202122.HIC=high-income countries;LIC=low-income countries;LMIC=lower-middle-income countries;PPP=purchasing power

206、 parity;UMIC=upper-middle-income countries.0204060802002020212022Median price(US$,2020 PPP)05200022Median price(US$,2020 PPP)a.Fixed broadband plans b.Mobile broadband plansHICUMICLMICLIC(refer to figure 1.4,panel b).The number of countries meet

207、ing the Broadband Commissions mobile broadband affordability target increased from 96 in 2021 to 103 in 2022.3Mobile phones are the primary way in which people connect to the internet in low-and middle-income countries.Smartphone penetration is similarly converging between high-income and middle-inc

208、ome countries,while low-income countries remain far behind.Based on International Telecommunication Union data,in 2022,more than 95 percent of individuals in high-income coun-tries owned a mobile phone(including smartphones,feature phones,and basic phones).The share of mobile phone owners was 76 per

209、cent in upper-middle-income countries,66 percent in lower-middle-income countries,and only 49 percent in low-income countries.Smartphones have long replaced basic and feature phones for most mobile phone users.The rise of touchscreens,sophis-ticated mobile apps,built-in Global Positioning System,cam

210、era advancements,and other features 8 D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 have made smartphones the single most used digital device compared to personal computers,tablets,and wearables.As such,the number of smartphone connections exceeded the total popula-tion in high

211、-income countries in 2022(refer to figure 1.5,panela).4 Upper-middle-income countries arerapidly catching up with high-income countries,with smartphone connections approaching 100percent.Smartphone connections also grew rapidly in lower-middle-income countries,although the pace has slowed since 2020

212、.Progress in low-income countries has been too slow to narrow the gap with other income groups.Similar to fixed broadband,lack of affordability is a main barrier contributing to the divide in smartphone penetration across countries.Even the cheapest smartphones are too expensive for the lowest-incom

213、e groups,with prices accounting for 14 percent or more of annual income for persons living on less than US$2 per day.Lower-cost feature phones provide a more accessible option for lower-income individuals,although such phones lack the more advanced capabilities and features of smartphones,manifestin

214、g a key digital divide with regard to type of device.While only 8 percent of mobile connections use basic or feature phones in high-income countries,the figurejumps to 46percent in Sub-Saharan Africa countries(refer to figure 1.5,panel b).Even greater digital divides are present in the rate of compu

215、ter ownership,which varies con-siderably between high-income and low-income countries and between urban and rural house-holds.More than 80 percent of households in Australia,Belgium,Estonia,Israel,Japan,and Poland owned a computer during 201721.These countries had almost no urban-rural gap in comput

216、er ownership.In contrast,fewer than 20 percent of households in the Kyrgyz Republic,Malawi,Mali,Mozambique,Myanmar,and Nigeria owned a computer(refer to figure 1.6,panela).Computer ownership is higher in other lower-income countries,although it is heavily skewed toward urban households,as in Angola,

217、Bhutan,or Niger.In Latin America and the Caribbean,more than half of urban households,on average,possessed a computer or tablet,while only 38percent of rural households possessed such devices.In rural Colombia,Haiti,andNicaragua,these devices were present in only about 15 percent of households(refer

218、 to figure 1.6,panel b).FIGURE 1.5 Smartphone penetration,by income group,region,and type of connection,201522Sources:Original calculations for this publication using GSMA and World Development Indicators data;GSMA 2022,fig.1.6.Note:EAP=East Asia and Pacific;ECA=Europe and Central Asia;HIC=high-inco

219、me countries;LAC=Latin America and the Caribbean;LIC=low-income countries;LMIC=lower-middle-income countries;MENA=Middle East and North Africa;SAR=South Asia;SSA=Sub-Saharan Africa;UMIC=upper-middle-income countries.a.Smartphone connectionsb.Type of mobile connection 0204060801001202015 2016 2017 20

220、18 2019 2020 2021 2022Smartphone connections per100 inhabitants787272020406080100%of connectionsHICsEAPLACECAMENASARSSA4G/5G smartphoneBasic or feature phone3G smartphoneData-only deviceHICUMICLMICLIC D I G I T A L A D O P T I O N:A c c E L E R A T I N G P

221、 O S T P A N D E m I c,y E T A W I D E N I N G D I v I D E 9Larger gaps are forming in internet speeds and data useInternet speeds have risen sharply since the start of the pandemic,resulting in improved service qual-ity and enhanced user experience with more data-intensive applications.However,spee

222、ds rose much faster in high-income countries than in middle-income countries and even fell slightly in low-income countries.International bandwidth,which mirrors the overall capacity of a network,has been increas-ing across all income groups,but the pace has been much faster in high-income countries

223、 than in middle-income countries(refer to figure 1.7).Bandwidth continues to be very low in low-income countries.Similarly,download speeds leaped in high-income countries between 2019 and 2023,widening the gap in quality of service and end user experience compared to lower-income coun-tries(refer to

224、 figure 1.8).Divides in device ownership,connection quality,and affordability have contributed to the significant gaps in data traffic per capita,with low-income countries representing a small fraction of both fixed and mobile broadband data traffic.The pandemic has driven a surge in internet traffi

225、c since 2019,especially among high-income and upper-middle-income countries.Fixed broadband traffic per capita grew most rapidly in high-income countries from 2019 to 2020,but decelerated afterward.Mobile broadband traffic per capita continued to soar during 2019 to 2022.Both types of traffic per ca

226、pita more than doubled in FIGURE 1.7 Use of bandwidth per user,by country income group,201522Source:Original calculations for this publication using International Telecommunication Union data.Note:Median across countries in the same income group.HIC=high-income countries;LIC=low-income countries;LMI

227、C=lower-middle-income countries;UMIC=upper-middle-income countries.005006007008002000212022Kilobytes per internet userHICUMICLMICLICFIGURE 1.6 Rural and urban households with a computer or tablet,by country income group,various yearsSources:Original calculations for

228、this publication using International Telecommunication Union data for 201722(panel a)and on World Bank High-Frequency Survey data for 2021 for Latin America and the Caribbean(panel b).Note:HIC=high-income countries;LIC=low-income countries;LMIC=lower-middle-income countries;UMIC=upper-middle-income

229、countries.AUSBELESTISRJPNPOLARMAZEBGRBIHBLZBRAECUMEXMKDSURAGOBTNDZAEGYKGZMMRNGAPSESLVUKRZWEMLIMOZMWINER020406080100%of urban households020406080100%of rural householdsATGCHLPANURYARGCOLCRIDMADOMECUGTMGUYJAMLCAMEXPERPRYBOLHNDNICSLVHTI20406080%of urban households20406080%of rural householdsa.%of house

230、holds with a computerb.%of households with a computer or tabletHICUMICLMICLIC10 D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 FIGURE 1.9 Fixed and mobile broadband traffic per capita,by country income group,201522a.Fixed broadband b.Mobile broadband 02004006008001,0001,20020152

231、0002202040608002000212022Median fxed broadband trafc(gigabytes per capita)Median mobile broadband trafc(gigabytes per capita)HICUMICLMICLICSources:Original calculations for this publication using International Telecommunication Union(ITU)and Wor

232、ld Development Indicators data.Note:Figure depicts median traffic per capita by income group,using ITU available data between 2015 and 2022.Mobile broadband traffic includes internet trafficboth within and outside the country.HIC=high-income countries;LIC=low-income countries;LMIC=lower-middle-incom

233、e countries;UMIC=upper-middle-income countries.upper-middle-income countries between 2019 and 2021(refer to figure 1.9).Between 2019 and 2022,the median traffic per capita of fixed and mobile broadband grew by almost nine and seven times,respectively,inlow-income countries.However,this traffic start

234、ed from extremely low levels,effectively widening the gap in data traffic between high-income and upper-middle-income countries versus lower-middle-income and low-income countries.Median mobile broadband traffic per capita was more than 20times higher in high-income countries than in low-income coun

235、tries,and median fixed broadband traffic per capita was more than 1,700 times higher in 2022.FIGURE 1.8 Median speed of fixed and mobile downloads,by country income group,2019 and 2023Source:Original calculations for this publication using Ookla data.Note:Median across countries in the same income g

236、roup.HIC=high-income countries;LIC=low-income countries;LMIC=lower-middle-income countries;UMIC=upper-middle-income countries.020406080100HICUMICLMICLICSpeed(megabytes per second)Fixed 2019Fixed 2023Mobile 2019Mobile 2023 D I G I T A L A D O P T I O N:A c c E L E R A T I N G P O S T P A N D E m I c,

237、y E T A W I D E N I N G D I v I D E 11FIGURE 1.10 Impact of COVID-19 on patterns of smartphone use,by type of app,201922Source:Original calculations for this publication using Apptopia data for all active apps in Google Play and Apple Store globally.Note:Values for time spent in January 2019 are nor

238、malized to 1,and values are smoothed over six months.0.81.01.21.41.6DownloadsJanuary2019January2020January2021b.DownloadsJanuary2022December2022BusinessEducationFinanceHealthMedicalMobilityProductivityShoppinga.Total time spent1.00.51.52.02.5Total time spentJanuary2019January2020January2021January20

239、22December2022COVID-19 boosted the use of business,education,finance,medical,health,and shopping appsThe pandemic significantly boosted the use of business,education,finance,medical,health,and shopping apps.In March 2020,more than 100 governments enforced full or partial lockdowns to contain the vir

240、us.5 Remote work,online schooling,telemedicine,and online shopping enabled daily activities to continue during a period of enforced lockdown and social distancing.While people used computers primarily for remote work and online schooling in higher-income countries,patterns of smartphone use also rev

241、eal that downloads(proxying the number of new users)of business,education,finance,medical,health,and shopping apps all grew significantly in the first half of 2020;total time spent using these apps also was higher than before the pandemic(refer to figure 1.10a).Among all categories of apps,business

242、apps have grown the most in scale and length of use.Business apps consist largely of video conferencing and business communication apps(like Zoom),professional networking and hiring platforms(like LinkedIn),business procurement apps,products and services selling apps(like Amazon seller),and corporat

243、e digital solutions apps(remote desktop,cloud,file management).Downloads of business apps peaked at more than 300million in May 2020,75 percent higher than the level in January 2019,and total time spent more than doubled(refer to figure 1.10,panel b).Most of the increase in downloads of and total ti

244、me spent using busi-ness apps was driven by video conferencing apps.China,India,the UnitedStates,Indonesia,Brazil,and Mexico supplied most of the new downloads,while Bulgaria,Romania,Uruguay,Nigeria,the Philippines,and Peru had the highest growth rates indownloads.The pandemic induced a durable acce

245、leration in digital payments and online shopping in many countries.Finance and shopping apps are the other two categories of apps with persistently high downloads.Countries in Sub-Saharan Africa(Burkina Faso,Ghana,Malawi,Nigeria)and the Middle East and North Africa(Kuwait,Saudi Arabia,the United Ara

246、b Emirates)recorded the high-est growth in finance app downloads,while several European Union countries(Bulgaria,Finland,Hungary,Ireland),India,and Senegal recorded the highest growth in shopping app downloads 12 D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 (refer to figure 1.

247、11).Countries where the use of digital payments and online shopping were already prevalent before the pandemic had much lower growth indownloads.Countries that adopted more stringent lockdowns witnessed higher downloads and greater use of business,education,games,and health apps and much lower downl

248、oads and use of travel apps.Lockdown stringency was a strong predictor of monthly downloads and total time spent for several types of apps.On a scale of 0100,a 1 unit increase in a countrys lockdown stringency predicted a 0.6 percent increase in business app downloads,a 0.2 percent increase in game

249、app downloads,and a 0.5 percent drop in travel app downloads in the same month(refer to figure 1.12,panel a).A1unit increase in lockdown stringency also boosted total time spent on business apps by 0.3percent,educa-tion apps by 0.1 percent,and game apps by 0.07 percent and reduced the total time spe

250、nt on travel FIGURE 1.11 Growth in app downloads,by country and type of app,201922Source:Original calculations for this publication using Apptopia data for the top 500 most downloaded apps in Google Play and Apple Store in each country.Note:EAP=East Asia and Pacific;ECA=Europe and Central Asia;LAC=L

251、atin America and Caribbean;MENA=Middle East and North Africa;NAC=North America;SAR=South Asia;SSA=Sub-Saharan Africa.For a list of country and economy codes,refer to https:/www.iso.org/obp/ui/#search.CHNHKGKORPHLSGPJPNAUSTWNMYSTHAVNMNZLIDNFINNLDSWERUSBELDNKNORPOLFRAGBRPRTITADEU TURESPHRVROUCZEIRLUKR

252、GRCHUN CHEBGRVENCHLMEXBRAPERARGCOLISRTUNEGYARESAUKWTUSACANINDPAKKENZAFTZANGABFAMWIGHA50050100150200Growth rate(%),2022 versus 201950510Downloads 2019(log)a.Finance appsb.Shopping appsEAPECALACMENANACSARSSACHNMYSPHLVNMSGPIDNTHAKORTWNJPNNZLAUSHKGUKRFRANLDNORCHEESPDEUBELITARUSDNKPRTSWEGRCPOLGBRTURROUCZ

253、EHRVFINIRLHUNBGRPERURYCOLARGVENBRAMEXCHLAREISRSAUKWTEGYTUNUSACANPAKINDNGAGHATZABFAZAFMWISEN50050100150200Growth rate(%),2022 versus 2019202468Downloads 2019(log)AUTAUTURYKENFIGURE 1.12 Effect of lockdown stringency on downloads and total time spent on apps,by category of app,202022Source:Original ca

254、lculations for this publication using Apptopia data.Note:The figure displays the coefficients and 95%confidence interval of a 1 unit increase in a countrys lockdown stringency(on a scale from 0 to 100)on the total downloads and total time spent on a certain category of app in the current month and a

255、fter 3,6,9,and 12 months.Control variables include the number of new COVID-19 cases per million population,country fixed effects,and month-year fixed effects.a.DownloadsCurrent monthAfter 3 monthsAfter 6 monthsDownloadsAfter 9 monthsAfter 12 months0.500.51.0b.Total time spentCurrent monthAfter 3 mon

256、thsAfter 6 monthsTotal time spentAfter 9 monthsAfter 12 months0.500.5BusinessEducationGamesHealthTravel D I G I T A L A D O P T I O N:A c c E L E R A T I N G P O S T P A N D E m I c,y E T A W I D E N I N G D I v I D E 13apps by 0.26 percent(refer to figure 1.12,panel b).While the effects of lockdown

257、s on app downloads(a proxy for new users)were immediate and limited largely to the same month,the effects on total time spent persisted.For instance,for 3 months after the initial lockdown,total time spent on business apps remained much higher in countries that imposed harsher lockdowns.Further,the

258、negative effect on the use of travel apps persisted for 12 months after the initial lockdown.The effects on downloads and use of the top 500 apps were even larger and more persistent.Digital uptake by businesses varies significantly across countriesand types of technologyThis section compares firms

259、digital uptake in 14 countries from four regions based on the World Banks Firm Level Adoption of Technology(FAT)survey conducted during 201922.Each country was only surveyed in one wave,so the data do not allow an analysis of trends.An appendix at the end of the report provides more details about th

260、e FAT survey.For all cross-country comparisons presented in this section,the value is the predicted value after controlling for firm age,firm size,and sector.While companies in high-income countries continue to integrate the latest digital technologies like generative artificial intelligence(AI)plat

261、formsinto their products,services,and business functions,many companies in low-and middle-income countries,particularly small and medium enterprises,were without a computer or internet connection in 2022.The World Banks FAT sur-vey revealed significant disparities in firms access to basic technology

262、 enablers across countries.After controlling for firm age,size,and sector,almost all firms in Brazil,Chile,Georgia,India,the Republic of Korea,Poland,and Viet Nam had a computer for business purposes and internet con-nection.In contrast,only half of firms in Bangladesh,Burkina Faso,and Ethiopia had

263、computers,illustrating the wide divide between businesses and the use of internet technology across countries(refer to figure 1.13).In some low-and middle-income countries,firms with access to a computer and the internet face limits in pursuing broader digital transformation due to outdated connecti

264、on methods and poor qual-ity of internet services.Dial-up internet,long phased out in most countries,requires users to link their phone line to a computer.In Burkina Faso,this outdated method of connecting to the internet is still the fastest type of connection for more than 70 percent of firms.In a

265、ddition to low internet speeds,firms in some low-and middle-income countries also suffer frequent disruptions in internet service.In Bangladesh,internet service is predicted to crash seven times permonth on average.Such frequent FIGURE 1.13 Share of firms with a computer or internet connection acros

266、s countries,201922Source:Original calculations for this publication using World Bank Firm Level Adoption of Technology survey data.Note:The panels illustrate the estimated probability,with 95%confidence intervals,after controlling for country,sector,firm size,and firm age.100 99999897959481675046414

267、040020406080100Estimated probability(%)Viet NamBrazilPolandKorea,Rep.IndiaChileGeorgiaCambodiaKenyaBangladeshGhanaEthiopiaBurkina FasoSenegal100 100 999997969579726953524637020406080100Estimated probability(%)Viet NamChilePolandKorea,Rep.BrazilGeorgiaIndiaKenyaCambodiaGhanaEthiopiaBurkina FasoBangla

268、deshSenegala.Access to a computerb.Access to an internet connection14 D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 disruptions make it difficult to maintain business continuity and compete with other firms in the global digital economy.Many competing firms in higher-income eco

269、nomies not only experience fewer disruptions but also enjoy the assurance of redundancy,designed to reduce disruptions not only in internet connection but also in the energy systems that power use of the internet and digital devices.In most high-income markets,it is essential for businesses to use a

270、 website or social media account to boost visibility,reach potential customers,gain market insights,and grow their brand.However,website and social media use remains low among firms in some poorer countries relative to similar firms in richer countries.After controlling for firm age,size,and sector,

271、survey results predicted that more than half of firms in Brazil,Chile,Ghana,Kenya,and Poland have a website.Further,results indi-cated that four in five firms in India use social media accounts for business purposes.In contrast,only around 13 percent of firms in Burkina Faso,Ethiopia,and Senegal hav

272、e a website;these three countries are also the least likely of the countries surveyed to use social media for business purposes(refer to figure 1.14).One(of many)reason that these countries have such low figures is that digital platforms are not as useful or as effective in reaching customers in the

273、ir markets because their customers may lack access to digital technologies and means of internet connectivity at this time.Use of advanced technology services like cloud computing is even more rare in most of the low-and middle-income countries surveyed.Businesses can benefit from cloud computing in

274、 multiple FIGURE 1.14 Use of website,social media,and cloud computing for business purposes in select countries,201922 Source:Original calculations for this publication using World Bank Firm Level Adoption of Technology survey data.Note:Figures illustrate 95 percent confidence intervals.686262605950

275、38363427266080Estimated probability(%)ChileBrazilPolandGhanaKenyaKorea,Rep.CambodiaViet NamBangladeshIndiaGeorgiaEthiopiaSenegalBurkina Faso847568675232220100Estimated probability(%)IndiaChileKenyaBrazilGhanaCambodiaPolandGeorgiaKorea,Rep.Viet NamBangladeshSenegalBur

276、kina FasoEthiopia454347766500Estimated probability(%)BrazilGhanaChileKenyaCambodiaKorea,Rep.PolandIndiaGeorgiaViet NamBangladeshSenegalEthiopiaBurkina Fasob.Social mediac.Cloud computinga.Website D I G I T A L A D O P T I O N:A c c E L E R A T I N G P O S T P A N D E m I c,y E

277、T A W I D E N I N G D I v I D E 15ways,ranging from cost savings,scalability and flexibility,enhanced collaboration and productiv-ity,increased reliability and data security,and better decision-making through advanced analytics and insights.Cloud adoption is already mainstream in high-income countri

278、es.About 80 percent of US businesses surveyed by the PricewaterhouseCoopers cloud business survey reported using cloud services in most or all parts of their businesses in 2021.6 Among the countries surveyed in the FAT survey,Brazil,Chile,Ghana,and Kenya reported the highest cloud adoption,at around

279、 40 percent of firms.In most other countries surveyed,cloud adoption remains rare.Fewer than 10 percent of firms in Bangladesh,Burkina Faso,Ethiopia,Georgia,India,Senegal,and Viet Nam used cloud computing services during 201922(refer to figure 1.14).Firms in low-and middle-income countries continue

280、to have huge untapped potential in the use of digital technology for payments and sales.While firms in these poorer economies lag on the exten-sive margin(whether technology is used or not),the gap is even larger on the intensive margin(how frequent technology is used).Only one in five firms in Bang

281、ladesh,Burkina Faso,Ethiopia,Ghana,and Senegal use online banking for payments.Further,almost none of the firms in these countries use online banking as the most common method for payments(refer to figure1.15).Useof an online FIGURE 1.15 Use of technologies applied to payment methods in select count

282、ries,201922Source:Original calculations for this publication using World Bank Firm Level Adoption of Technology survey data.Note:Figures illustrate 95 percent confidence intervals.966406453220406080100Estimated probability(%)BrazilPolandChileKorea,Rep.Indi

283、aGeorgiaKenyaViet NamCambodiaGhanaBangladeshEthiopiaBurkina FasoSenegala.Online bankingExtensive marginIntensive margin6434002020406080Estimated probability(%)IndiaKenyaGhanaBurkina FasoSenegalBangladeshBrazilChilePolandEthiopiaViet NamGeorgiaKorea,Rep.Cambodiab.Onli

284、ne platform16 D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 Source:Original calculations for this publication using World Bank Firm Level Adoption of Technology survey data.Note:Figures illustrate 95 percent confidence intervals.5510152025Estima

285、ted probability(%)303295275000001010203040Estimated probability(%)b.Company websitea.Digital platform3810152025Estimated probability(%)PolandKenyaChileBrazilKorea,Rep.Viet NamGhanaIndiaCambodiaGeorgiaSenegalBangladeshBurkina FasoEthiopiaBrazilCh

286、ilePolandKenyaViet NamKorea,Rep.GeorgiaGhanaIndiaBurkina FasoSenegalBangladeshCambodiaEthiopiaChileBrazilKorea,Rep.PolandKenyaBangladeshGhanaIndiaViet NamBurkina FasoGeorgiaSenegalCambodiaEthiopiac.Electronic orderExtensive marginIntensive marginFIGURE 1.16 Use of technologies applied to sales metho

287、ds in select countries,201922platform for payments is less common than online banking across economies.Useof digital plat-forms,company websites,and electronic orders to manage sales is also limited in the countries sur-veyed,especially on the intensive margin(refer to figure 1.16).This digital divi

288、de in adoption has enormous implications for firms in low-and middle-income countries,as their ability to connect with customers efficiently and effectively in an increasingly competitive digital economy relies on narrow-ing the divide through greater digital uptake.D I G I T A L A D O P T I O N:A c

289、 c E L E R A T I N G P O S T P A N D E m I c,y E T A W I D E N I N G D I v I D E 17Firms with greater digital readiness before the pandemic and those that invested in digital solutions during the pandemic were more resilientThis section uses the World Banks Business Pulse Survey(BPS)to track firms d

290、igital uptake since the outbreak of COVID-19.The BPS was conducted in several waves from April 2020 to December 2022 to assess the impact of the pandemic on businesses in dozens of countries around the world.These surveys also captured information on how much firms invested in and used digital solut

291、ions before and during the pandemic.The appendix provides more details about BPS data.The share of firms investing in digital solutions increased significantly over the course of the pandemic.While COVID-19 drove firms of all sizes online,the pandemic widened the gap between small and large firms in

292、vesting in digital solutions.Based on the BPS conducted in dozens of coun-tries across six regions,about 16 percent of firms invested in digital technologies during the early phase of the pandemic from April to August 2020.This share increased to 26 percent during the second phase of the pandemic fr

293、om September 2020 to June 2021 and increased to 33percent dur-ing the final phase of the pandemic from July 2021 to December 2022.This increase in investment in digital technologies transpired for firms of all sizes,but most dramatically for large firms,con-tributing to a widening of digital divides

294、 despite widespread investment globally.Over the course of the pandemic from April 2020 to December 2022,the percentage of micro firms investing in digital solutions doubled from 10 percent to 20 percent,but the percentage of large firms tripled from 20percent to 60 percent(refer to figure 1.17).The

295、 use of digital solutions was highest during the middle phase of the pandemic(September 2020 to June 2021),declining slightly after mid-2021.Still,use remained much higher in 2022 than in early 2020.This finding holds true for firms across all sizes and in all sectors,after controlling for time,firm

296、 size,sector,and region fixed effects(refer to figure 1.18).Normalcy started to return in late 2021,as people obtained protection from infection and received vaccines and earlier strains were replaced by the less virulent Omicron variants.As a result,in-person interaction began to increase.Thus,the

297、final phase of the pandemic is associated with the likelihood that the firms sur-veyed would use digital solutions less often than in the second phase.Still,the probability of using digital solutions at the end of 2022 remained much higher than in early2020.Firms digital readiness and management pra

298、ctices before the pandemic predicted a higher probability of investment in and use of digital solutions during the pandemic.Digital readiness was measured as the number of pre-COVID-19 digital practices applied out of three indicators:online sales or payment,online social media,and use of enterprise

299、 resource planning software and systems.Management practices were measured as the number of structured management practices applied out of three indicators among firms:targets,advertise-ments,and promotion of employees.The num-bers were then used to generate firm capability scores.A score of 0 indic

300、ated no digital pre-paredness or poor management practices before FIGURE 1.17 Share of firms investing in digital solutions during COVID-19,by firm size,202022Source:Original calculations for this publication using World Bank Business Pulse Survey data.Note:Firm owner is not counted as an employee.0

301、070Micro(04)Small(519)Medium(2099)Large(100+)%of frmsFirm size by number of employeesAprilAugust 2020September 2020June 2021July 2021December 202218 D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 the pandemic,while a score of 4 indicated the highest digital readiness

302、and best management practices.BPS results revealed that the firms with higher scores were more likely to invest in and use digital technologies(refer to figure 1.19).Firms with greater digital readiness before the pandemic and those that invested in digital solu-tions during the pandemic also record

303、ed greater resilience in sales.Firms with higher digital readi-ness before the pandemic had a higher share of sales during the pandemic due to their use of digital platforms(refer to figure 1.20).Firms that invested in digital solutions during the pandemic also experienced a much smaller decline in

304、sales relative to firms that did not invest across all levels of prepandemic digital readiness.FIGURE 1.18 Predicted probability of using digital solutions over time,by size of firm and sector,202022Source:Calculation based on World Bank Business Pulse Survey data.0.20.30.40.50.6Predicted probabilit

305、y of increasing theuse of digital solutionsMicro(04)Small(519)Medium(2099)Large(100+)a.Size of frm0.70.20.30.40.50.60.7Predicted probability of increasing theuse of digital solutionsAgricultureManufacturingRetailOther servicesb.SectorAprilAugust 2020September 2020June 2021July 2021December 2022FIGUR

306、E 1.19 Association between firms capabilities and digital investment and use,202022 Source:Calculation based on World Bank Business Pulse Survey data.Did not investInvestedDid not useUsed020406080100Share of frms(%)b.UseScore=0Score=1Score=2Score=3Score=4020406080100Share of frms(%)Score=0Score=1Sco

307、re=2Score=3Score=4a.Investment D I G I T A L A D O P T I O N:A c c E L E R A T I N G P O S T P A N D E m I c,y E T A W I D E N I N G D I v I D E 19FIGURE 1.20 Association between firms resilience in sales and digital investment and use,202022 Source:Calculation based on World Bank Business Pulse Sur

308、vey data.Note:A higher score indicates higher digital readiness and better management practices prepandemic.b.Use020406080100Share of sales using digital platform(%)Score=0Score=1Score=2Score=3Score=435302520151050Changes in sales(%)Score=0Score=1Score=2Score=3Score=4a.Investment276102311

309、Did not investInvestedDid not useUsedDigital adoption and diffusion must be facilitated to narrow the digital divideTo boost economic growth,the diffusion and adoption of digital technologies are arguably just as critical as their invention.The contribution of new technology to economic growth can o

310、nly be real-ized when and if the new technology is widely diffused and used.Technologys diffusion relies on a series of decisions by people and organizations based on comparing uncertain technological benefits with uncertain adoption costs.Well-informed and skilled individuals along with pioneering

311、compa-nies,often located in high-income economies,have frequently extolled the positive impact of digital technology and reaped hefty rewards due to their technological understanding.However,much of the world is still at the start of the digital adoption journey.Governments can play a key role in sp

312、eeding up the adoption of technology.Identifying what type of market failure justifies government support,determining the size of the market failure,and articulating why and under what conditions government support could lead to higher adoption and not waste public resources are critical initial ste

313、ps for public policy.Governments can catalyze private investment in digital infrastructure to connect the unconnected.These catalysts include removing restrictions on foreign participation and ownership in internet service providers and spec-trum-based operators,promoting infrastructure sharing,ensu

314、ring competition,and monitoring the quality of internet services(ITU 2020).Addressing the affordability of devices is one tangible means of closing the use gap of individuals living within the range of a broadband signal but not using the services.Government can promote affordable entry-level device

315、s in several ways.Import duty reductions and tax exemptions can lower the cost of devices but have fiscal implications.Financing schemes should be based on a risk-sharing model that subsidizes devices between parties with an interest in bringing more individuals online,including manufacturers,retail

316、ers,consumers,app partners,and governments.Successful pilot subsidy programs exist,but providing subsidies at scale remains a challenge.While much has been achieved over the last decade to narrow the divide in internet access,more work is needed to minimize the divide in smartphone and computer owne

317、rship,fixed broadband penetration,internet speeds,data traffic,digital skills,and productive useparticularly in the face 20 D I G I T A L P R O G R E S S A N D T R E N D S R E P O R T 2 0 2 3 of emerging and disruptive digital technologiesas much as possible.It is critical for policy mak-ers and dev

318、elopment stakeholders to monitor developments in the latest digital technologies like generative AI,which has been adopted rapidly in 2023.Broader generative AI applications have enormous potential to simplify digital tasks at all levels of complexity,including coding and data analysis,and offer new

319、 opportunities for facilitated learning of both digital and other skills.At the same time,if global adoption and use rates mirror the general digital divides between higher-income and lower-income economies(as discussed in this chapter),it will only further exacerbate the asymmetrical distribution o

320、f benefits yielded by these new technologies.Chapter 5 discusses the latest AI developments,the associated benefits and risks,trends in AI governance,and the implica-tions for low-and middle-income countries.NotesXavier Cirera,Ana Goicoechea,Silvia Muzi,Sara Oliveira,and Nithya Srinivasan provided k

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333、r:A Driver of Innovation,Growth,and Job CreationYan Liu and Henry StemmlerKEY MESSAGES Value added growth of information technology(IT)services averaged 8 percent annually between 2000 and 2022,growing nearly twice as fast as the global economy.Employment in IT services grew by 7 percent annually during the same period,far outstripping the meager 1percent growth in total employment.IT services are