Digital Economy Transformation: G20's Vision for an Inclusive Digital Future

The South African Presidency of the G20 comes at a time of increased international focus on the digital economy, particularly its instrumental role in development and economic and social reconstruction following the COVID-19 pandemic. The pandemic accelerated digital transformation globally, revealing both the potential of digital technologies to support development and the stark digital divides that exclude billions from these benefits.

A Pivotal Moment for Digital Cooperation

The recent United Nations Summit of the Future and its Global Digital Compact (GDC) set out objectives, principles, commitments, and actions for a new global digital cooperation that will lead to more equitable and just outcomes. In 2025, the 25th review of the foundational framework for global digital cooperation provided by the World Summit on the Information Society (WSIS) outcomes represents a pivotal opportunity for global action to strengthen and broaden efforts towards an inclusive digital economy and society that is people-centered and meets the development aspirations of the international community.

The South African G20 Presidency follows a sequence of developing countries that have provided leadership to the G20. Since this will be the first time the G20 has come to Africa in its current format, this is an invaluable opportunity to consider the particular challenges and opportunities facing people on the African continent, where digital divides are often most pronounced.

South Africa welcomes the opportunity to continue discussions with G20 members, international organizations, knowledge partners, and invited guests on how to harness the transformative power of digital technologies to bring about inclusive development for all. We will also continue to consider the importance of having suitable frameworks to guide the adoption of new technologies in a way that will optimize their benefits and limit potential harms.

Connectivity for Inclusive Digital Development

Connectivity forms the foundation of the digital economy. Without reliable, affordable internet access, individuals and communities cannot participate in digital opportunities. Yet significant connectivity gaps persist, particularly in rural areas, low-income communities, and developing countries.

The Digital Economy Working Group focuses on expanding connectivity infrastructure, including broadband networks, mobile connectivity, and last-mile solutions that can reach remote and underserved communities. This includes exploring innovative approaches such as community networks, public Wi-Fi initiatives, and satellite connectivity solutions that can bridge connectivity gaps.

Affordability remains a critical barrier. Even where infrastructure exists, high costs can exclude low-income users. The working group examines policies and initiatives that can reduce connectivity costs, including through competition, infrastructure sharing, and targeted subsidies for vulnerable populations.

Digital literacy and skills are equally important. Having connectivity without the skills to use digital technologies effectively limits participation in the digital economy. The working group explores initiatives to build digital skills across all segments of society, from basic digital literacy to advanced technical skills needed for digital jobs.

Digital Public Infrastructure and Transformation

Digital public infrastructure (DPI) provides foundational systems that enable digital transformation across society. These include digital identity systems, payment platforms, data exchange mechanisms, and other core digital services that governments and citizens rely on.

Well-designed DPI can dramatically improve service delivery, reduce costs, increase efficiency, and enhance transparency. For example, digital identity systems can enable citizens to access government services, open bank accounts, and participate in the formal economy. Digital payment systems can facilitate financial inclusion and reduce transaction costs.

However, DPI must be designed with principles of inclusion, privacy, security, and interoperability. The working group explores how to build DPI that serves all citizens, protects privacy and data rights, ensures security, and can work across different systems and platforms.

South Africa emphasizes the importance of DPI for development, recognizing that these foundational systems can unlock opportunities across multiple sectors, from healthcare and education to agriculture and finance. The working group examines how DPI can be designed and implemented to maximize development impact while ensuring that benefits are shared equitably.

Digital Innovation Ecosystems: Unleashing MSME Potential

Micro, Small, and Medium Enterprises (MSMEs) are engines of economic growth and job creation, yet they often face barriers to participating in the digital economy. These barriers include limited access to digital tools and platforms, lack of digital skills, insufficient financing, and challenges accessing digital markets.

The Digital Economy Working Group focuses on unleashing the potential of MSMEs through digital innovation. This includes initiatives to provide MSMEs with access to digital tools and platforms, build their digital capabilities, facilitate access to digital financing, and help them reach digital markets.

Digital platforms can provide MSMEs with access to customers, suppliers, and services that were previously out of reach. E-commerce platforms enable small businesses to reach global markets. Digital payment systems facilitate transactions. Cloud computing provides access to enterprise-grade IT infrastructure at affordable costs.

However, MSMEs need support to take advantage of these opportunities. This includes training and capacity building, access to financing for digital investments, and policies that create an enabling environment for digital entrepreneurship. The working group explores how governments, private sector, and international organizations can work together to support MSME digitalization.

Equitable, Inclusive, and Just Artificial Intelligence

Artificial intelligence represents one of the most transformative technologies of our time, with the potential to revolutionize industries, improve service delivery, and address complex challenges. However, AI also raises concerns about bias, discrimination, job displacement, and concentration of power.

The Digital Economy Working Group, working closely with Task Force 3 on Artificial Intelligence, Data Governance, and Innovation for Sustainable Development, focuses on ensuring that AI development is equitable, inclusive, and just. This includes addressing AI bias and discrimination, ensuring that AI benefits are distributed fairly, protecting workers from displacement, and preventing excessive concentration of AI capabilities.

Equitable AI means ensuring that AI development serves all of humanity, not just the privileged few. This requires addressing the AI divide between developed and developing countries, ensuring that developing countries can participate in AI development and benefit from AI applications.

Inclusive AI means ensuring that AI systems work for all people, regardless of their characteristics or circumstances. This includes addressing bias in AI systems that can discriminate against certain groups, ensuring that AI applications are accessible to people with disabilities, and making sure that AI development includes diverse perspectives.

Just AI means ensuring that AI development respects human rights, promotes social justice, and contributes to sustainable development. This includes protecting privacy and data rights, ensuring transparency and accountability in AI systems, and using AI to address rather than exacerbate inequality.

Building on Past Achievements

South Africa looks forward to building on the achievements of past presidencies, which have made significant progress in areas such as digital skills, cybersecurity, data governance, and digital innovation. The working group will continue to advance these areas while addressing new challenges and opportunities.

The Digital Economy Working Group's work aligns with South Africa's broader G20 priorities of solidarity, equality, and sustainability. By promoting inclusive digital development, the G20 can help ensure that digital technologies serve as tools for empowerment and development rather than sources of exclusion and inequality.

The African Opportunity

Africa represents both a challenge and an opportunity for digital development. The continent has the world's youngest population, high mobile phone penetration, and growing tech ecosystems. However, it also faces significant connectivity gaps, limited digital infrastructure, and skills shortages.

South Africa's G20 Presidency provides an opportunity to highlight Africa's digital potential and the support needed to realize it. By focusing on connectivity, DPI, MSME support, and equitable AI, the Digital Economy Working Group can contribute to unlocking Africa's digital opportunities while ensuring that benefits are shared equitably across the continent and globally.

As the world becomes increasingly digital, ensuring that this transformation is inclusive and beneficial for all becomes ever more critical. The work of the Digital Economy Working Group will be essential in shaping a digital future that serves humanity's best interests.