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OECD Secretary-General

Launch of the Latin American Economic Outlook 2020: Digital Transformation for Building Back Better

 

Remarks by Angel Gurría

OECD Secretary-General

24 September 2020 - OECD, France

(As prepared for delivery)

 

 

 

 

President Duque, President Alvarado, Alicia Bárcena, Luis Carranza, Commissioner Jutta Urpilainen, Ministers, Ladies and gentlemen,


I am very happy to be taking part in the launch of the 2020 edition of the “Latin American Economic Outlook: Digital Transformation for Building Back Better”.


I would like to thank Colombia for hosting this side event in the context of the United Nations General Assembly, as well as ECLAC, CAF and the European Union for the excellent collaboration in preparing the report.


The COVID-19 crisis is having an enormous impact. According to our latest analyses, global GDP will fall by 4.5% in 2020, before growing by 5% in 2021. In Latin America, as Alicia Bárcena explained, the impact will be even stronger, not only because of the structural challenges of our health and social security systems, but also because the pandemic occurred during one of the worst economic periods for the region, marked by low growth, low productivity, high inequalities, high informality and rising poverty levels.


Latin American governments now need to respond to the epidemic, while at the same time developing recovery strategies aligned with structural reform efforts, so as to address long-term challenges. This is very difficult. It requires technique, science and experience. But also an intensive use of digital technologies. The countries that are best prepared digitally will most likely be the first to emerge from this crisis.


That is why this report, this joint effort, is so important.


I would like to highlight some of the key messages.


First, it is essential to close connectivity gaps. In 2018, 68% of the population of Latin America was connected to the Internet, double the figure in 2010, but still far from the OECD average of 84% for that year. In addition, the level of Internet connection of the richest fifth of the population is 40% higher than that of the poorest fifth. Within countries, this gap is compounded between urban and rural populations: in some countries, the number of Internet users in urban areas is four times higher than users in rural areas. We must invest in digital infrastructures and strengthen competition in the sector in order to promote greater universal access to broadband Internet.


Second, we must prepare workers for the digital transformation. In several Latin American countries, over 20% of jobs are at high risk of automation. We are not prepared for this reality. In fact, under half of workers in the region have experience in using computers for basic professional tasks. And fewer than 10% use digital technologies for more complex tasks like programming. In the face of the emergence of new ways of working, enhanced lifelong learning programmes and stronger social protection systems are required to promote inclusion in the formal labour market.


Third, the digital capacities of the education system need to be strengthened. Education is at the heart of an inclusive digital transformation. School closures during the pandemic affected 154 million students in the region. And only 14% of less wealthy students have a computer with an Internet connection at home, compared to 80% of richer students. Furthermore, only 20% of underprivileged schools have a virtual support platform. Similarly, gender gaps and stereotypes also impede digital training for women and affect their integration into the formal labour market.


If we are to close educational gaps, we need to increase the digital capacities of schools, promote the early development of digital skills and abilities, and increase women’s use of, and access to, digital technologies.


Fourth, digital transformation has to be an integral part of national development plans. Digital transformation concerns all sectors and all aspects of life. It must therefore be integrated into National Development Strategies. Now, more than ever, the priority has to be implement, implement, implement. To support countries in this process, the OECD has proposed the integrated policy framework of the Going Digital Toolkit, which includes seven policy dimensions – access, use, innovation, jobs, society, trust, and market openness.


Lastly, as European Commissioner Jutta Urpilainen explained, international cooperation will also be essential if our countries are to make full use of the digital transformation. The OECD is contributing to this through initiatives such as the updating of the global tax reporting framework for the digital economy, the Going Digital project, the Principles on Artificial Intelligence, and the report on "How's Life in the Digital Age?". We are putting all this knowledge to work for Latin America.

 

Ladies and gentlemen,


The region of Latin America and the Caribbean is facing one of the most serious crises in its history. Remember: the solutions, policies, programmes and strategies for recovery will only be as effective as each country's digital capacity. Digital technologies will help to build back quickly, but also to build back better, creating more inclusive and sustainable economies.


With the 2020 edition of the Latin American Economic Outlook, the OECD Development Centre, ECLAC, CAF and the European Union are ready to support the development and implementation of structural policies that will take advantage of the digital transformation to build the new prosperous, fair and clean Latin America that all Latin Americans deserve.


The OECD is ready to continue to deliver. You can count on our support. Thank you.

 

 

 

See also:

OECD work with Latin America

OECD work on Economy

 

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