The Inter-American Development Bank is concerned about the slow implementation of digitalisation in Latin American and the Caribbean.
In the report “Latin American and Caribbean Microeconomic Report entitled Digitalising Public Services: Opportunities for Latin America and the Caribbean” which was published this month, the IDB noted that the region was still significantly behind the rest of the world in term of adopting digital practices.
The report stated: “Compared to developed countries, governments in Latin America and the Caribbean are significantly lagging in offering digital applications such as learning platforms, apps to promote healthy behaviours, apps for online business registration and tax e-filing. In many cases, governments offer some type of digital public service related to an important development challenge, but the specific service provided is not expected to generate large value to society.”
The report singled out the limited digital accessibility available for public services, which has created great issues for citizens in the region, particularly after the COVID-19 pandemic.
The report stated: “The countries of Latin America and the Caribbean are lagging behind countries worldwide in the provision of digital transactional services. On the United Nation’s Online Service Index, only Brazil, Argentina, and Chile are among the top 30 countries in the world. These lags were laid bare during the pandemic.
“In civil registration, citizens face difficulties making basic transactions with governments such as obtaining an identity card. And in social protection, high levels of tax evasion and imperfect targeting of subsidies diminish the capacity of governments to reduce poverty through effective redistribution of resources,” said the report.
The report also noted the lack of infrastructure and general know-how had also left the region particularly susceptible to cyberattacks.
The report explained: “Digital applications also raise the risk of data privacy infringement. A strength of digital tools is their ability to collect, store, and process large amounts of data, but regulations need to be put in place to protect the privacy of sensitive personalised data so that the rights and freedoms of citizens are respected by government authorities.”
The report continued: “Another threat to privacy comes from non-governmental actors, whether domestic or foreign. As data exchanges through digital applications are accessible on computer networks, they may become vulnerable to hacking and cyberattacks by unauthorised users. Thus, it is important to embed digital applications in a secure internet infrastructure and develop a regulatory framework for data access. Finally, as more and more applications are being developed in both the public and private sectors, user activity on digital devices may expand to the point where its value is diminished by information overload and limited attention.”
Last Friday, Prime Minister Dr Keith Rowley acknowledged that the government had to push on with its digitalisation drive, even as there remained an active resistance to the adoption.
The Prime Minister himself admitted to his distrust of automatic teller machines (ATMs), but said the changes would be to the country’s benefit in the long run.
“I say that the one thing that would be there for sure is the resistance to the new opportunities by people like me, who may be scared off or have come from so far back, and we are so invested in what exists that the change that is required may be beyond us. But because the Government understands that there are huge benefits to be had, we are forging ahead and taking along with us. Those who are available to take it on board right now. But knowing that eventually, all of us would be taken along by this current of technology that flows across the world, whether we want to or not,” said the Prime Minister at the donation ceremony held last Friday at the Carenage Police Youth Club and Homework Centre where one IdeaHub interactive smart board and 50 tablets were given to the Carenage community by Huawei.
“We are moving to digitalise and digitise our databases in all ministries, bit by bit step by step. Some ministries are well ahead of others,” the Prime Minister continued, “With each passing month, each passing year, you will see the country using more and more technology and getting the benefit of the government’s operations and the community and the nation’s operations.
“We have to transform and we are transforming ourselves, our homes, our children, our business, our nation is to be and is being transformed,” he said.
However, the extent of that transition so far is up for debate, as there was a continuous call from both the ordinary citizen and the business community for these elements to be improved in the public service before the reading of the last month’s budget.
The IDB report noted that these challenges were common among Latin America and the Caribbean and indeed a gateway to corruption.
“Transactional services in Latin America and the Caribbean are often difficult. On average, they require 5.5 hours of active time for citizens, ranging from 2 hours in Chile to 11 hours in Bolivia (Roseth, Reyes, and Santiso 2018). Furthermore, half of all transactions require two trips or more to government offices and a quarter of them require three or more trips. They are also a focal point for corruption: a third of Latin Americans paid a bribe to access a transactional public service in 2017,” the IDB report noted.
This issue was also alluded to by the Prime Minister on Friday, as he referred to the introduction of the ASYCUDA World System for Customs and Excise a few years ago.
“I can tell you for a fact, there was great resistance in some quarters to having it being put there. People prefer to have these huge volumes of books that you turn all the pages and they get dog-eared, and people tear out what they want and leave what they don’t want. And to find out how to code your document, and what you import, what the code is, oh man! And it takes three days or one officer to agree on what it is. Nowadays, you put the name of the item there and it instantly tells you what it is and tells you what the code is and tells you what the customs duties and so on.
“You will not believe how much resistance there was to that. Because what exists, usually serves the purpose of some people,” said the Prime Minister.
Yet some of those in opposition to digital practices have pointed to potential exclusion of members of the public who may not have the devices to access these services. However, the IDB report noted some strategies could be implemented to level the playing field.
The report said: “Governments should make sure that low-income populations benefit from digital public services by adopting a few sensible principles. In particular, governments should:
(i) Develop and deploy solutions that work well with basic smartphones with sporadic Internet access (such as WhatsApp) so that low-income populations with access to these devices can take advantage of the new digital public services offered;
(ii) Target promotion efforts to spur adoption of digital public services among low-income people to ensure that this population reaps the benefits of the digital public services provided; and
(iii) Channel savings arising from deploying low-cost digital services to those that have access (eg, urban populations) in order to provide effective non-digital services to those that currently do not have access (eg rural populations).”
The report also suggested that improved digital services in the education system could help decrease the dropout rate in schools, while also aiding in improving efficiencies in the health system.