Thomas Sanchez, founder of digital innovation agency Social Driver, demonstrates Google Glass at the National Press Club in Washington in this April 4, 2014, file photo. (AFP Photo/Nicholas Kamm)

At WEF Talk, Technology Seen as Key to Reducing Inequality


JANUARY 23, 2015

Davos. In a fast-changing world, driven by technology, network connection is fast becoming a basic social good. But technology is a double-edged sword as it will also widen income inequality around the world.

Technology has enabled unequivocal social gains in recent years, but the benefits have not been equally spread.

“Almost all of the problems we debate can be solved by more broadband connectivity,” said Eric Schmidt, executive chairman of Google. He cited broadband as the key public policy initiative that can promote social benefits.

In a session on the Future of Digital Economy at the 45th World Economic Forum annual meeting, corporate leaders said that digital tools, from farming and health care to education, have fundamentally transformed communities and raised living standards around the world, and greater network connectivity has the potential to improve livelihoods even further.

John Riady, a director at Lippo Group and co-chair of the World Economic Forum East Asia meeting in Jakarta, said inequality was one of the defining challenges facing businesses and governments.

“One of the things that we have to look at is the impact of technology on inequality,” he noted. “Technology has a lot of potential to improve lives and business efficiency, but one of the big risk is labor dislocation.”

According to a recent study, 6 percent to 7 percent of nonfarm labor in countries that make up the Association of Southeast Asian Nations will be dislocated by greater adoption of technology.

“Our challenge is how can we mitigate the impact of technology so it is sustainable. If not there will be a backlash,” John said, adding that one way to lessen inequality is to harness technology through education.

“In a global world, where everyone has access to technology, those who don’t will be even further left behind.”

For Indonesia, to ensure that every citizen has access to technology, the solution is to build low cost and universal access to the Internet.

“Technology cuts both ways. It can create between $300 billion to $500 billion in economic value for Asean over the next two decades, but if we do not manage it well, it will backfire, leading to greater inequality within countries and between countries,” John said.

Asean countries must therefore go beyond just providing basic education. They need to create an education system that teaches the mind to be agile and respond to the changing environment. In essence, they need to incorporate liberal arts with science and engineering.

The second component of education is language and “to compete, we must be able to speak English. Its not about nationalism, its about competition,” John said.

Thirdly, the most challenging aspect of the education system is to encourage an open society. In his WEF address, Chinese Premier Li Keqiang said: “When the winds of change begin to blow, some people build walls, while others build windmills.

“Asean and Indonesia must build windmills, but we should also build sails so that we can all move forward.”

Ensuring that the gains of technology are distributed evenly is by no means guaranteed. Unless policymakers and technologists take active measures to promote inclusion, women aren’t likely to get the same opportunities.

Sheryl Sandberg, chief operating officer at Facebook, said: “It’s something that takes an active, and, I think, different role than we’ve had before.”

She noted that currently more than half of the Internet’s content is in English and that women typically receive access to smartphones later than men.

Looking ahead, Schmidt predicts “the Internet will disappear,” as the use of smart devices will help eliminate the barrier between being online and offline.

The Lippo Group is affiliated with GlobeAsia