The shift to a hyperconnected world presents a formidable opportunity—but also risks and challenges
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- The shift to a hyperconnected world presents a formidable opportunity—but also risks and challenges
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- Authors: HERVE TOURPE
- Published: March 2, 2021
Overview / key thesis
- Author: HERVE TOURPE, head of the IMF’s Digital Advisory Unit.
- Central argument: The pandemic-accelerated move to a more hyperconnected world creates major opportunities to expand access to education, health, employment, and financial services, but also amplifies digital risks that require comprehensive policy responses.
- Notable contextual claims and timeframes:
- The pandemic has accelerated digital adoption, “some say by five years.”
- Technology firms are positioning for a post-COVID world in which people “will do more from home—buying, learning, working, and socializing.”
Satellite mega constellations: opportunity and caveats
- Opportunity and scope:
- Could serve the 53 percent of the developing world with no internet connectivity.
- SpaceX has launched “more than 1,000 of 12,000 planned low-Earth-orbit Starlink satellites.”
- Other players: OneWeb plans to launch “650 satellites this year alone,” and Amazon’s Project Kuiper is expected to send up “thousands of high-speed satellites soon.”
- Potential to “leapfrog decades of infrastructure investments” and serve as backbones for mobile networks, accelerating mobile internet adoption.
- Economic impact claim:
- IMF research: “a 10 percent increase in internet penetration could raise real per capita GDP growth 1 to 4 percentage points in sub-Saharan Africa.”
- Three-quarters of the people in sub-Saharan Africa do not currently have internet access.
- Cost comparisons and infrastructure needs:
- Terrestrial internet efforts for Africa are “expected to cost about $100 billion over the next 10 years.”
- Satellite solutions could deliver service “for a fraction of that cost, in the next two years,” with household requirements limited to “a small antenna and a box.”
- Constraints, costs, and risks:
- Orbital congestion: satellites could rise from “fewer than 3,000 today to possibly more than 20,000,” impacting ground-based astronomy.
- End-user costs: “initially about $100 a month, plus another $500 for the hardware,” which is too steep for poorer countries and would require subsidies.
- Nontechnical barriers: language barriers, limited digital and financial skills, and increased exposure to “fraud and misuse of data” could limit benefits without training and regulation.
- Policy implications:
- International organizations, development banks, and governments can “seize this new opportunity,” but must combine regulation, digital skills programs, and mindset changes to make connectivity valuable.
Digital identity: benefits, maturity, and persistent risks
- Scale of identity exclusion:
- “1.1 billion people worldwide lack documentation or verifiable credentials to prove their identity” (World Bank Group figure cited).
- Expected benefits of national digital ID:
- Increased government transparency (budget and elections), easier access to government assistance, and expanded access to basic financial services, especially for displaced or undocumented people.
- Technological readiness and innovations:
- Mature underlying technologies: “two-factor authentication and asymmetric encryption” improve data integrity and privacy.
- AI, machine learning, and biometric sensors in mobile devices can reduce fraud and simplify user experience via fingerprints, face, or voice scanning.
- Emergence of “digital ID open-source software, open application-programming-interface (API)-based solutions, and international standards” that reduce implementation costs.
- Early tests of “blockchain-based identities” are gaining momentum in several countries, including in Estonia, with potential to shift control and ownership of data from governments to citizens while preserving government authority to issue and validate identity.
- Barriers and risks:
- Adoption previously slowed by ineffective national coordination, limited digital literacy, cybersecurity issues, data privacy concerns, and mistrust of government-provided technologies.
- Pandemic accelerated adoption needs (e.g., rapid delivery of financial assistance), making the “time ... ripe” for national digital ID deployment in some contexts.
- Persistent dangers: privacy risks when digital ID is combined with tracing apps; misuse and potential exclusion if systems are not secure, inclusive, and interoperable.
- Policy priorities:
- Successful digital ID systems must be “secure, inclusive, and interoperable.”
- Continuous attention from policymakers and regulators is required to manage misuse and privacy concerns.
Managing digital risks: the accelerating threat landscape
- Pandemic-driven exposure:
- Increased remote work has made companies more exposed to online threats via personal computers accessing corporate systems.
- Contact tracing apps have heightened tensions between “data privacy and public health policy goals.”
- Common attack vectors: phishing schemes, malware downloads, ransomware attacks against hospitals, and intellectual property theft against vaccine companies.
- Broader geopolitical and technological trends:
- Geopolitical tensions and cyber-offensive capabilities have encouraged both nation-states and nonstate actors, “blurring the lines between spies and malicious hackers.”
- The World Economic Forum in 2019 placed cybersecurity at the top of the global risk landscape, alongside climate change.
- Non-cyber digital risks highlighted:
- Misinformation amplification through technology beyond any single country.
- Deepfakes: “deceptive videos produced by artificial intelligence” that may fuel political tensions.
- AI-specific concerns: “faster-than-expected automation of certain jobs,” amplification of gender and racial biases, and the “black box problem” where AI reaches conclusions that even developers can’t explain.
- Policy question posed:
- “Can governments become more agile, and can they rapidly adopt a more comprehensive approach to risk regulation and digital strategy to reap the benefits of this acceleration while limiting the risks?”
Key statistics and exact numeric points (verbatim)
- 53 percent (developing world with no internet connectivity).
- “more than 1,000 of 12,000 planned” (SpaceX Starlink satellites launched).
- OneWeb: “650 satellites this year alone.”
- Amazon’s Project Kuiper: “thousands of high-speed satellites soon.”
- IMF finding: “a 10 percent increase in internet penetration could raise real per capita GDP growth 1 to 4 percentage points in sub-Saharan Africa.”
- “three-quarters” (of the people in sub-Saharan Africa lack internet access).
- Terrestrial infrastructure cost estimate for Africa: “about $100 billion over the next 10 years.”
- Satellite fleet growth projection: from “fewer than 3,000 today to possibly more than 20,000.”
- End-user satellite costs: “initially about $100 a month, plus another $500 for the hardware.”
- Identity exclusion: “1.1 billion people worldwide lack documentation or verifiable credentials to prove their identity.”
- Pandemic acceleration estimate: “some say by five years.”
Content based on “The shift to a hyperconnected world presents a formidable opportunity—but also risks and challenges,” HERVE TOURPE, F&D Magazine, March 2021.
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