Launch of the OECD Digital Economy Outlook
Remarks by Angel Gurría
Paris, Wednesday 11 October 2017
(As prepared for delivery)
Dear Parliamentarians, Ambassadors, Ladies and Gentlemen,
It is my great pleasure to launch this new edition of the OECD Digital Economy Outlook. Right now, our Director for Science, Technology and Innovation, Andy Wyckoff, is also launching this book almost 9,000 km away, in Seoul where I opened the Ministerial meeting on the “Future of the Internet Economy” 10 years ago.
Impressive technological advances
One decade on, and technology continues to race ahead – at an ever faster speed. The social impacts have also become more pronounced. Digital innovation enables applications and services in a wide range of sectors, including in science, healthcare, agriculture, government and cities.
For example, in healthcare, the use of mobile health applications (apps) and of electronic health records enables new care models and provides the foundation for greater co-ordination and improved clinical management. Governments are promoting e-government services to individuals and firms, they are also providing open access to public sector information, and are communicating directly with citizens via social networks.
Parliaments are increasingly going digital, both in the ways we operate as well as in how we communicate. Cities are also seizing the benefits of digital applications. These are being used in areas from urban transport and energy, to water and waste systems. They are also exploring the potential of data-driven innovation to improve urban operations and decision-making.
And let us not forget about the effects of technology on education, particularly in remote areas; the impact that social networks are having in many aspects of our daily lives; and the importance of remittances and crowdfunding. The list goes on. It is a social revolution!
Despite these amazing benefits however, progress has been uneven across countries and sectors. There is still a lot to do to ensure that digital technologies become effective tools for inclusive and sustainable growth. Let me outline three priorities which are highlighted in the report.
Creating reliable and affordable access
First, to fully benefit from the opportunities linked to digitalisation, everyone – individuals, businesses and governments – needs reliable and affordable access to digital networks and services, as well as appropriate skills to use the technology. Unfortunately this is not yet the reality.
For example, mobile data usage is growing fast, but not everywhere: it is over 10 times higher in Finland than in the Slovak Republic ; only 11% of all firms in the OECD countries for which statistics are available, use advanced digital tools like big data analysis; despite good basic connectivity, the share of fibre in broadband networks is still critically low in some countries - only 2% in Germany, for instance, compared to 75% in Japan; the elderly lag behind the young on Internet usage : only 63% of 55-74 year-olds use the Internet and even fewer amongst those with low levels of education. By comparison, across the OECD, 96.5% of 16-24 year olds use the Internet.
To tackle these challenges, we need data-driven innovation and more successful start-ups to flourish in all countries. Opportunities abound, but governments must review legacy frameworks, embrace innovation and foster competition. Most importantly, they must provide policies to help equip workers and citizens with appropriate skills so that they are empowered to harness digital opportunities and strengthen social protection systems to facilitate the necessary adjustments.
Building trust in the digital transformation
The second critical element we need is trust. Digital security and privacy risks are intensifying. We see, almost daily, examples of data breaches affecting millions of users – take, for example, the recent breach at Equifax that disclosed sensitive data about 143 million U.S. consumers. The share of individuals that experienced digital security incidents is at over 20% in almost a third of OECD countries.
Privacy violations are not an exception either: in many countries, over 3% of individuals have experienced a privacy violation in the last three months. Some may say this is not surprising – in the EU for instance, over 70% of individuals are providing personal information online. But these incidents cannot become the new normal.
Businesses are taking action: within a decade, the share of firms using encryption has increased from 16% to 41%. Governments have also made progress on digital security strategies, though very few have a privacy strategy so far. They need to do more to promote digital risk management and build digital security skills and awareness.
In addition, facilitating international co-operation on cross-border digital security issues is a particular priority. Promoting greater information sharing and exchange on digital security incidents across countries can help provide early warning of risks and enhance resilience of global networks.
Updating our governance model to include the digital economy
Last but not least, we need a governance model that achieves coherence and effective co-ordination. While 34 OECD countries now have a national digital strategy, they often lack clear priorities and struggle with co-ordination. We see only 5 countries with a high-level official or a special body dedicated to digital affairs that can spearhead strategy development or co-ordination. Too many countries are still appointing ministries or bodies which are not fully dedicated to digital affairs and which often lack the necessary competence and clout to lead on digital issues.
To tackle these challenges, breaking down policy silos and adopting a whole-of-government approach to the digital transformation is essential – it’s time to “walk the talk” of national digital strategies. Approaches may differ across countries but there must be a coordination mechanism that ensures that policies in one sector – such as e-commerce – are not negating or undermining those in another – such as consumer rights.
Ladies and Gentleman,
“Computers and other digital advances are doing for mental power what the steam engine and its descendants did for muscle power.” These words by Brynjolfsson and McAfee project the size of this transformation. It is our responsibility to ensure that these changes result in a more harmonic, more resilient, more inclusive and sustainable global economy.
As parliamentarians, you have a crucial role in making this happen. The OECD is ready to work with you and for you to achieve better digital policies for better lives. Thank you.