“Pilot programmes are taking off”
In Germany we have experienced a push towards digitalisation due to the coronavirus pandemic. Are there similar tendencies in developing countries?
The circumstances in various parts of the world differ significantly, and it is also too soon to have an overview of the entire situation; we are still in the middle of the coronavirus pandemic. But what’s clear is that developing countries have recognised that their potential for development expands significantly if they position themselves well digitally. The operating system needs to be updated both here and there.
Does this apply to everyone?
Everyone sees the opportunities, but the countries are naturally at different points in the digitalisation process. Several countries in Asia are further advanced than some of the industrial countries. That’s what is so fascinating about this subject: normally the donors in development cooperation are one step ahead, which is not automatically the case in this area.
The UN frequently warns that coronavirus has put the Sustainable Development Goals at risk, and development gains could be lost. Can digitalisation mitigate this?
Digitalisation is one of the critical elements that could be used to achieve the global Sustainable Development Goals in spite of coronavirus. We need a larger leveraging effect for development cooperation. Otherwise we really do run the risk of falling wide of the mark – also due to coronavirus. And we can achieve this leveraging effect with digitalisation. It helps us to achieve the Development Goals more efficiently and creates an opportunity to scale up functioning pilot projects on a global level. It is imperative that we take advantage of this opportunity.
Could you illustrate this with an example?
Let’s look at vocational training as an example. Assume that we put a good deal of effort into developing a good curriculum for mechatronics engineers in Bangladesh. If we establish this curriculum as an e-learning course and make it available on a global e-learning platform, our partners can also use the course in Bolivia, Malawi, Vietnam and many other countries. It may need to be adjusted a bit depending on unique cultural aspects, the language may be different, but the framework remains the same and can be used elsewhere with relatively little effort. And e-learning is only one example: the same also applies to e-ID systems, intelligent energy systems or healthcare systems – for nearly all sectors and issues in development cooperation. Digitalisation allows us to see successful individual projects from a global perspective and copy them in other countries or sectors at relatively low cost, so successful pilot projects can generate added value above and beyond the particular case.
However, digitalisation is also associated with high investment costs...
Not necessarily. If we look at examples of past successes, the largest investment has already been made. Then we are talking about a type of secondary and tertiary exploitation with low additional costs. Precisely for this reason, we need to hone the way we look for these types of opportunities. Then we could multiply the effect with each invested euro.
But investments are needed in areas like network infrastructure, for example. After all, half of humanity still has no access to the web and cannot benefit from the opportunities of digitalisation.
That’s right. Nearly 50% of people worldwide still do not have access to the Internet; in Africa that figure is even around 75%. So investing in network access is extremely important, but we are talking about enormous amounts here. According to estimates, 800 billion euros would be needed for Africa alone. Sums like that are beyond the possibilities of individual nations. Only large multilateral financial actors like the World Bank or European Investment Bank can finance network expansion, ideally together. We help to strengthen the capacities of the local regulatory authorities, because the example of 5G shows us how difficult it is to put these investments into practice.
Speaking of network access: the digital gap between women and men is large and has been growing even larger. At the same time, we know that women are particularly important for development. How can we give them access to the network?
That really is a problem: we have a digital gap between poor and rich, urban and rural households, and between men and women. And we need to change this. There is still a lot to do here, also for us. What's needed most of all is increased awareness and more education. With the #ESkills4girls initiative, we are working with ten organisations in Africa, Asia and Latin America to prepare technical careers for girls.
Are some sectors better suited to digitalisation projects than others?
Many of the problems that we deal with at the Federal Ministry for Economic Cooperation and Development (BMZ) can be dealt with more efficiently using digital solutions. However, digitalisation is more than technology, computers and apps. The central question is always how we can think about and design processes differently to use innovation to make them more efficient and effective for the target group. When we think about digitalisation this way, it offers approaches in every sector.
We’ve spoken a lot about opportunities. Are there also risks? Or are they not as important in view of the major development needs in many countries?
We are living at the beginning of a new age, like the introduction of agriculture 10,000 years ago or industrialisation 200 years ago. In addition to the unique chances this offers, there are also tremendous risks. Cyber-attacks or the viral spread of fake news can cause massive damage. Processing citizens’ data is associated with significant risks – especially when combined with artificial intelligence – it can endanger human rights and undermine democracies.
Doesn’t that ultimately mean that it isn’t possible to implement digitalisation projects with certain regimes?
Only with great caution and after thorough examination, at any rate. Because in reality some products can be abused for military purposes or for social screening. So regulations and standards that prevent this abuse are very important. This is why working towards these types of guidelines is also part of our tasks.
As “little Europe”, do our digital solutions even have a chance in this global competition?
Yes. When shaping the digital transformation, we are in global competition with differently orientated social models. As the largest internal market in the world, the EU is relying on its own model for a sustainable digital society to distinguish itself internationally as a sustainable economic area and place to live. If we further pool our strengths in Europe with this vision of a sustainable digital future, we can make a decisive difference. So under the German European Council presidency, we are currently establishing the European donor platform D4D Hub and better positioning ourselves according to the motto “Team Europe”.
Are African countries, for example, interested in European ideas and applications at all?
It’s different depending on the country, but overall there is a lot of interest in cooperating with Europe. We can see that in the new EU-Africa strategy, which is expected to be passed during the German European Council presidency and play a critical role in digitalisation. And we can see it in the “Smart Africa” initiative, in which 30 of the 54 African countries have aligned together. Last October, the German Federal Ministry for Economic Cooperation and Development (BMZ) and the secretary of the initiative agreed to a close cooperation.
How much enthusiasm about digitalisation is there in German development cooperation?
We also find ourselves in the midst of a change process. German Development Minister Gerd Müller made digitalisation an initiative issue and a quality characteristic in the “BMZ 2030” reform strategy for German development cooperation. We are anchoring digital principles and the “digital by default” standard throughout our business in an inter-departmental digital forum. This means: we intend to make it standard practice to check whether digital components could be more effective for every new project. KfW Development Bank just restructured itself to this end and established its own department for digitalisation and innovation. I welcome this and think it is a wise and future-oriented step.
The interview was conducted by Friederike Bauer.