Ma Jian, deputy representative of the United Nations Industrial Development Organization (UNIDO) for China, warned about potential challenges being posed by the digital economy at the sixth China and Globalization Forum held in Beijing last week. 

Despite making contributions to achieving the Sustainable Development Goals for peace and prosperity, Ma explained that the digital economy could also potentially give rise to significant challenges which should be monitored.

Ma pointed out three challenges lurking amid the rapid development of the digital economy.

First, is a big digital divide between high-income and developing countries, with nations lacking information and communications technology said to be facing "digital poverty." Today's technological breakthroughs in advanced digital production (ADP) are again dividing the world into leaders, followers and those lagging behind.

According to the UNIDO's Industrial Development Report 2020, the 10 leading ADP economies, which includes China, account for 91% of all global patenting in ADP technologies and 70% of global exports of relevant goods. The 88 economies lagging behind, however, show no or very little engagement in this regard. 

Second, digitization also presents challenges for employees. In its Future of Jobs Report 2020, the World Economic Forum (WEF) states: "We estimate that by 2025, 85 million jobs may be displaced by a shift in the division of labor between humans and machines." 

"Based on the WEF report, 40% of employees will need to learn new skills in six months or less to cope with the digital challenges in the workplace by 2025," Ma noted. 

Employees in small and medium-sized enterprises (SMEs) are also facing significant problems, Ma believes, citing that in the digital era, SMEs often fail to gain adequate access to credit and digital support, and might lack an awareness of how to take full advantage of digital technologies.

Third, the impact of digitization on gender equality must not be overlooked. "Women remain underrepresented in fields such as digitalization, engineering, science and technology," Ma commented. "Nevertheless, they make up a disproportionately large share of the workforce in administration, and the textile and garment manufacturing industries where manual labor is more likely to be replaced by automation."

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