ADB lauds digital technologies as key to Asia's COVID-19 recovery

Digital platforms and other technology-based tools are providing new growth opportunities for businesses in Asia and the Pacific, a trend that could contribute to the region's recovery from the COVID-19 pandemic, according to a new Asian Development Bank (ADB) report released on Wednesday.

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"A digital platform creates a virtual place for communities to interact and exchange information, goods, and services. With the rise of digital platforms, new business models have proliferated, offering enormous economic opportunities," the report said, adding the pandemic is speeding up the digital transformation for businesses of all sizes and across all industries.

ADB Chief Economist Yasuyuki Sawada said countries in Asia and the Pacific have leveraged rapid technological progress and digitalization to recover and reconnect to the global economy during the pandemic.

The report said business-to-consumer revenues of digital platforms reached US$3.8 trillion in 2019 globally, with Asia and the Pacific accounting for about 48 percent of the total or US$1.8 trillion, equivalent to 6 percent of the region's GDP.

These figures are expected to have significantly increased in 2020 as more business transactions - such as ride-hailing, food delivery, and e-commerce - migrate to the digital space amid restrictions imposed to curb the spread of COVID-19.

The report added that sped-up digital transformation can potentially boost global output, trade and commerce, and employment.

According to the report, a 20-percent increase in the size of the global digital sector can increase global output by an average of US$4.3 trillion yearly from 2021 to 2025.

Similarly, it said Asia and the Pacific would reap an economic dividend of over US$1.7 trillion yearly, or over US$8.6 trillion over the five years to 2025.

There will be about 65 million new jobs created yearly in Asia and the Pacific until 2025 from the increased use of digital technologies, with regional trade also expected to increase by US$1 trillion yearly over the next five years, said the report.

It added that the governments in the region can leverage and reap the benefits of the emerging digital economy through policies and reforms to improve digital infrastructure and connectivity, and access to them.

The report also emphasized the need to focus on data privacy and security, taxation, a partnership between public and private institutions, and regional cooperation.