Accelerating Development in Developing Countries: Directing Resources Towards Holistic Technological Integration
I’ve always been curious about the concept of “leapfrogging”. It’s an often-used term. Ever since I entered the digital transformation space, I’ve heard everyone-who-is-everyone proclaim that technology will help the developing world to “leapfrog”. It sounds promising and exciting, but few have ever dissected how exciting “leapfrogging” really is.
This is how I imagine it.
I imagine it to be rapid and transcendent change. Perhaps the word “metamorphosis” is more apt when we talk about what the developing world aspires to. In a world where historically, the developing world has been playing catch up, we stand at a unique point where development can assume an entirely new trajectory. Where the size of budgets or history no longer determine the pace of progress. We have the potential to chart a new direction for the global future.
However, to do that, we must understand that technology for technology’s sake isn’t enough to have the progress that we so crave. Developing countries would need to think very differently about technology. It all starts with understanding the transformative value of technology, being intentional about the catalytic value of shared digital infrastructure and allocating the necessary resources for value to be derived through its deployment.
In an age where technology underpins progress, the allocation of budgets and resources in developing nations often fails to reflect its transformative potential. In most cases, the ICT Ministries are allocated limited budgets which reflect the lack of importance that is allocated to them. Priority often is given to defence and economic ministries which makes logical sense at the base level but needs to change once technology is understood as an enabler rather than a silo. In 2021, Zimbabwe’s allocation to the ICT Ministry was a meagre 0.5% of the total budget reflecting a trend across most of the developing world including Asia and Latin America. For something touted as being transformative, this trend needs to change for any meaningful impact to be realised. Instead of viewing Information and Communication Technology (ICT) as a siloed department, developing countries should recognize its cross-cutting influence and prioritize non-siloed approaches that encompass data exchange and integration across all sectors. By reallocating funds to technological integration, developing countries can achieve more significant strides in economic growth and societal development, even with limited budgets.
Strategic national budgeting holds the potential to catalyse transformative change for developing countries, especially when allocations prioritize Information and Communication Technology (ICT). Recognizing ICT as cross-cutting, investing in this sector essentially amounts to investing in most other sectors of the economy and society. By strategically directing budget allocations towards ICT initiatives, countries can unlock 10x outcomes in various aspects of development. Investing in ICT infrastructure and digital literacy programs can bridge the digital divide, empowering citizens with access to information, education, and opportunities for economic participation. Moreover, leveraging ICT for e-Government services can streamline administrative processes, enhance transparency, and reduce corruption, leading to more efficient governance and improved service delivery. Additionally, strategic investments in ICT-driven innovation and entrepreneurship ecosystems can spur economic growth, create jobs, and foster a culture of innovation, positioning countries competitively in the global digital economy. Ultimately, placing strategic budget allocations to ICT can yield exponential returns, driving sustainable development, and propelling developing countries towards prosperity and inclusive growth.
It is important to note that planning and budgeting is just the beginning of a larger process. The funds need to be used for deployments that enable the functions of other ministries, agencies, and the private sector. This is the important role of Digital Public Infrastructure (DPI) which are foundational layers which enable other aspects of the economy and society through shared digital infrastructure.
Budget Disparities: A Glaring Imbalance
The disparity in budget allocation between technology and other sectors in developing countries is glaring. According to the World Bank, many nations allocate less than 1% of their annual budgets to ICT-related expenditures. This pales in comparison to the substantial investments made in sectors like infrastructure, healthcare, and education. For instance, in Sub-Saharan Africa, only 1.1% of total government expenditure is allocated to ICT, whereas infrastructure commands a whopping 5.9%. This discrepancy is reflected in digital infrastructure development, with the region lagging behind in broadband penetration and digital connectivity.
Embracing Holistic Technological Integration: A Game-Changing Approach
The importance of adopting a holistic approach to technology, one that includes secure data exchange and integration across sectors, cannot be overstated. Unlike traditional siloed approaches, holistic technological integration serves as a catalyst, influencing and enhancing various aspects of the economy and society.
Take for example, how strategically deployed technology can have transformative impact on multiple sectors. For purposes of this article, we can look at the agricultural value chain. Technology has the potential to revolutionize the agricultural ecosystem and value chain, from land ownership to market access. In terms of land ownership, digital platforms and blockchain technology offer transparent and secure methods for recording land rights, reducing disputes and ensuring equitable distribution. By digitizing land records, smallholder farmers can gain formal recognition of their land tenure, unlocking access to credit and investment opportunities. Moreover, Geographic Information Systems (GIS) and remote sensing technologies enable farmers to optimize land use, improve crop yields, and mitigate environmental risks by providing real-time data on soil health, water availability, and weather patterns.
Moving along the value chain, technology facilitates efficient production, processing, and distribution of agricultural products. Precision agriculture techniques, powered by IoT sensors, drones, and AI algorithms, enable farmers to monitor crops with precision, applying inputs such as water and fertilizers only where needed, thus minimizing waste and maximizing yields. Furthermore, mobile applications and e-commerce platforms connect farmers directly with buyers, eliminating middlemen and reducing transaction costs. Through digital marketplaces, farmers can access wider markets, negotiate fair prices, and ensure timely delivery of their produce, thereby increasing their profitability and livelihood resilience. Technology empowers stakeholders across the agricultural value chain, fostering sustainability, inclusivity, and prosperity in rural communities.
The transformative impact of shared digital infrastructure and technologies in the agricultural sector extends beyond its boundaries, optimizing the cost of development across various sectors of the economy. For instance, the utilization of IoT sensors and data analytics in precision agriculture not only enhances crop productivity but also reduces water usage and mitigates environmental impacts, thus contributing to sustainable water resource management and environmental conservation efforts. Additionally, the adoption of digital marketplaces and e-commerce platforms creates new opportunities for entrepreneurship and employment, stimulating economic growth and innovation. Moreover, the availability of real-time agricultural data can inform policymaking and market forecasting, facilitating more informed decisions in sectors such as finance, trade, and food security. By leveraging shared digital infrastructure and technologies, economies can achieve synergies across sectors, fostering innovation, efficiency, and resilience while optimizing development costs.
Leapfrogging Through Strategic Investments in Data Exchange
In the face of limited resources, developing countries must embrace technology as a means of leapfrogging traditional development barriers. Strategic investments in data exchange infrastructure and interoperability can yield significant returns, enabling nations to achieve more with less.
India provides a compelling example of this phenomenon. Through initiatives like Digital India and Aadhaar, the country has leveraged technology to drive inclusive growth and empower its citizens. With over 1.2 billion Aadhaar numbers issued, India has established a robust digital identity infrastructure, facilitating access to government services and financial inclusion. Moreover, by promoting data exchange standards and fostering collaboration between public and private sectors, India has created a vibrant ecosystem that fuels innovation and economic growth.
Conclusion: Embracing Holistic Technological Integration for Sustainable Development
In conclusion, the underinvestment in technology in developing countries is a missed opportunity for progress and prosperity. By reallocating budgets towards holistic technological integration and adopting non-siloed approaches that prioritize data exchange and interoperability, nations can unlock unprecedented opportunities for economic growth and societal development. Developing countries must recognize the cross-cutting nature of technology and prioritize it as a fundamental driver of progress. Through strategic investments in data exchange infrastructure and interoperability, nations can leapfrog traditional development trajectories and chart a path towards a brighter, more inclusive future for all.
