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How digital is your country? Europe needs Digital Single Market to boost its digital performance

MD Staff

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European Commission published the results of the 2018 Digital Economy and Society Index (DESI), a tool which monitors the performance of Member States in digital connectivity, digital skills online activity, the digitisation of businesses and digital public services.

According to it, the EU is getting more digital, but progress remains insufficient for Europe to catch up with global leaders and to reduce differences across Member States. This calls for a quick completion of the Digital Single Market and increased investments in digital economy and society.

Andrus Ansip, Vice-President for the Digital Single Market, said: “This is a shift, albeit small, in the right digital direction. As a whole, the EU is making progress but not yet enough. In the meantime, other countries and regions around the world are improving faster. This is why we should invest more in digital and also complete the Digital Single Market as soon as possible: to boost Europe’s digital performance, provide first-class connectivity, online public services and a thriving e-commerce sector.”

Mariya Gabriel, Commissioner for Digital Economy and Society, said: “We look forward to a rapid progress on major reforms such as the European Electronic Communications Code aiming at boosting investments in enhanced connectivity. This year’s Digital Economy and Society Index demonstrates that we must deploy further efforts to tackle lack of digital skills among our citizens. By integrating more digital technologies and equipping them with skills, we will further empower citizens, businesses and public administrations. This is the way to succeed the digital transformation of our societies.”

Over the past year, the EU continued to improve its digital performance and the gap between the most and the least digital countries slightly narrowed (from 36 points to 34 points). Denmark, Sweden, Finland and the Netherlands scored the highest ratings in DESI 2018 and are among the global leaders in digitalisation. They are followed by Luxembourg, Ireland, the UK, Belgium and Estonia. Ireland, Cyprus and Spain progressed the most (by more than 15 points) over the last four years. However, some other EU countries still have a long way to go and the EU as a whole needs to improve to be competitive on the global stage.

DESI 2018 shows:

Connectivity has improved, but is insufficient to address fast-growing needs

  • Ultrafast connectivity of at least 100 Mbps is available to 58% of households and the number of subscriptions is rapidly increasing. 15% of homes use ultrafast broadband: this is twice as high as just two years ago and five times higher than in 2013.
  • 80% of European homes are covered by fast broadband with at least 30 Megabits per second (Mbps) (76% last year) and a third (33%) of European households have a subscription (23% increase compared to last year, and 166% compared to 2013).

The number of mobile data subscriptions has increased by 57% since 2013 reach 90 subscriptions per 100 people in the EU. 4G mobile networks cover on average 91% of the EU population (84% last year).

Indicators show that the demand for fast and ultrafast broadband is rapidly increasing, and is expected to further increase in the future. The Commission proposed a reform of EU telecoms rules to meet Europeans’ growing connectivity needs and boost investments.

More and more Europeans use the internet to communicate

The highest increase in the use of internet services is related to telephone and video calls: almost half of Europeans (46%) use the internet to make calls, this is almost a 20% increase compared to last year and more than 40% increase compared to 2013. Other indicators show that 81% of Europeans now go online at least once a week (79% last year).

To increase trust in the online environment, new EU rules on data protection will enter into force on 25 May 2018.

The EU has more digital specialists than before but skills gaps remain

  • The EU improved very little in the number of Science, Technology, Engineering and Mathematics (STEM) graduates (19.1 graduates per 1000 people aged 20 to 29 years old in 2015, compared to 18.4. in 2013);
  • 43% of Europeans still do not have basic digital skills (44% last year).

Alongside the Digital Skills and Jobs Coalition, the Commission has launched the Digital Opportunity Traineeships to tackle the digital skills gap in Europe. The pilot initiative will provide digital traineeships for up to 6,000 students and recent graduates until 2020 in another EU country.

Businesses are more digital, e-commerce is growing slowly

While more and more companies send electronic invoices (18% compared to 10% in 2013) or use social media to engage with customers and partners (21% compared to 15% in 2013), the number of SMEs selling online has been stagnating over the past years (17%).

In order to boost e-commerce in the EU, the Commission has put forward a series of measures from more transparent parcel delivery prices to simpler VAT and digital contract rules. As of 3 December 2018, consumers and companies will be able to find the best deals online across the EU without being discriminated based on their nationality or residence.

Europeans use more public services online

58% of internet users submitting forms to their public administration used the online channel (52% in 2013).

  • 18% of people use online health services.

In April 2018, the Commission adopted initiatives on the re-use of public sector information and on eHealth that will significantly improve cross-border online public services in the EU.

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Economy

Côte d’Ivoire: Robust growth under the looming threat of climate change impacts

MD Staff

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According to the Economic Update for Côte d’Ivoire, published today, the short- and medium-term outlook for the Ivorian economy remains positive. The economy is expected to maintain a steady trajectory, with GDP growth of 7 to 7.5% in the coming years. Titled “So Tomorrow Never Dies: Côte d’Ivoire and Climate Change,” the report highlights the urgent need to implement measures to ensure that climate change impacts do not imperil this economic progress and plunge millions of Ivorians into poverty.

“The solid performance of the Ivorian economy, which registered growth of almost 8% in 2017, is essentially due to the agricultural sector, which experienced positive climate conditions. The economy also benefited from a period of calm after the political and social instability of the first half of 2017 and from more favorable conditions on international markets,” said Jacques Morisset, Program Leader for Côte d’Ivoire and Lead Author of the report. “The Government also successfully managed its accounts, with a lower-than-expected deficit of 4.2% of GDP, while continuing its ambitious investment policy, partly financed by a judicious debt policy on financial markets.

However, the report notes that private sector activity slowed in 2017 compared with 2016 and especially 2015, which may curb the pace of growth of the Ivorian economy in the coming years. Against the backdrop of fiscal adjustment projected for 2018 and 2019, it is critical that the private sector remain dynamic and become the main driver of growth. This is particularly important in light of the uncertainty associated with the upcoming elections in 2020, which could prompt investors to adopt a wait-and-see approach.

As economic growth in Côte d’Ivoire relies in part on use of its natural resource base, the authors of the report devote a chapter to the impact of climate change on the economy. They raise an alarming point: the stock of natural resources is believed to have diminished by 26% between 1990 and 2014. Several visible phenomena attest to this degradation, such as deforestation, the depletion of water reserves, and coastal erosion. According to the Intergovernmental Panel on Climate Change (IPCC), climate change could reduce GDP across Africa by 2% to 4% by 2040 and by 10% to 25% by 2100. For Côte d’Ivoire, this would correspond to a loss of some CFAF 380 billion to 770 billion in 2040.

This report sounds an alarm in order to spark a rapid and collective wake-up call,” said Pierre Laporte, World Bank Country Director for Côte d’Ivoire. “Combating climate change will require prompt decisions and must become a priority for the country to maintain accelerated and sustainable growth over time.”

The report pays special attention to coastal erosion and to the cocoa sector, which represents one third of the country’s exports and directly affects over 5 million people. With 566 km of coast, Côte d’Ivoire now boasts a coastal population of almost 7.5 million people, who produce close to 80% of the national GDP. Two thirds of this coast is affected by coastal erosion, with severe consequences for the communities and the country’s economy.

The Ivorian Government, which is already aware of this challenge and has prepared a strategy to confront it, must expedite its implementation. This would have the two-fold effect of developing a “green” economy and creating new jobs.

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Economy

A future of work based on sustainable production and employment

Simel Esim

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On the first Saturday of July each year, the international community celebrates the International Day of Cooperatives. This year’s theme, Sustainable consumption and production of goods and services is timely, as the ILO works towards a future of work that is based on sustainable production and employment models.

As head of the ILO’s Cooperative Unit, I have witnessed firsthand the positive impact of cooperatives’ commitment to sustainable consumption and production.

In Northern Sri Lanka, for instance, after years of civil war, I saw how cooperatives helped build the resilience of local communities.

A rapid assessment at the start of the ILO’s Local Empowerment through Economic Development project (LEED) indicated that cooperatives were the only “stable” structures present in Northern Sri Lanka before, during, and after the conflict. Since 2010, the project has been supporting agriculture and fishery cooperatives by securing fair trade certification for their products and helping them establish market links.

I’ve also listened to inspiring stories from other parts of the world of how cooperatives have joined forces to contribute to sustainable consumption, production and decent work – often through cooperative-to-cooperative trade.

Some of these stories were shared at a recent meeting in Geneva of cooperative and ethical trade movements.

We heard how Kenyan producer cooperatives’ coffee has found its way on the shelves of Coop Denmark and how biological pineapples from a Togolese youth cooperative are being sold in retail cooperatives across Italy. We heard how consumer cooperatives in East Asia have developed organic and ecolabel products, while educating their members about the working conditions of producers and workers, as well as on reducing food waste and plastic consumption. We also shared ILO experiences in supporting constituents in the field.

The emerging consensus from the meeting was that cooperative-to-cooperative trade can help lower the costs of trade, while ensuring fairer prices and better incomes for cooperative members and their communities. Opportunities exist not only in agricultural supply chains, but also in ready-made garments and other sectors.

Cooperatives at both ends of the supply chain have been joining forces to shorten value chains, improve product traceability and adopt environmentally-friendly practices. At the ILO we have been working with our constituents to improve the social and environmental footprint of cooperatives around the world.

As the ILO continues to promote a future of work that is based on sustainable production and employment models, a priority for us in the coming years is to facilitate the development of linkages between ILO constituents and cooperatives. The aim is to encourage joint action towards responsible production and consumption practices, the advancement of green and circular economies and the promotion of decent work across supply chains.

Source: ILO

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Economy

Mongolia’s Growth Prospects Remain Positive but More Efficient Public Investment Needed

MD Staff

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Mongolia’s economic performance has improved dramatically with GDP growth increasing from 1.2 percent in 2016 to 5.1 percent in 2017 and 6.1 percent in the first quarter of 2018. While short- and medium-term economic prospects remain positive, Mongolia faces core structural vulnerabilities that hinder its potential, according to Mongolia Economic Update, the latest World Bank report on Mongolia’s economy launched here today. The report also highlights the importance of improving efficiency of its public investment programs given extensive consequences from the overambitious and unrealistic investment programs implemented in the past.

“Last year was a good year for Mongolia with favorable commodities prices and the successful implementation of the government’s economic recovery program,” said Dr. Jean-Pascal N. Nganou, World Bank Senior Economist for Mongolia and Team Leader of the report. “This resulted in improved fiscal and external balances, triggering a slight decline of the country’s public debt.

The recovery is expected to accelerate with a GDP growth rate averaging more than 6 percent between 2019 and 2020, driven by large foreign direct investments in mining. Other than agriculture, which was severely affected by harsh weather conditions during the winter, most major sectors including manufacturing, trade, and transport are expected to expand significantly. On the back of increasing exports and higher commodity prices, economic growth will continue to have a strong positive impact on government revenue, contributing to the reduction of the fiscal deficit.

The unemployment rate dropped to 7.3 percent in the last quarter of 2017, compared to 8.6 percent a year earlier. Still, it increased to 9.7 percent in the first quarter of this year, reflecting Mongolia’s highly seasonal employment patterns due to difficult working conditions in the winter, especially in construction, agriculture, and mining.

The report highlights possible short- and medium-term risks including political risks, regional instability, climate shocks, and natural disasters. The most critical risk identified is a sudden relaxation of the government’s commitment to full implementation of its economic adjustment program supported by development partners.

In addition, the economy remains vulnerable to fluctuations in global commodity prices and a productivity gap. The best long-term protection against these two vulnerabilities is the diversification of the Mongolian economy.

To create a strong buffer against economic vulnerabilities, the government and donors should give a high priority to economic diversification that helps counter the ups and downs of the mining sector. Investing in human capital and strengthening the country’s institutions are the best way to support diversification, together with sound investments in crucial infrastructure,” said James Anderson, World Bank Country Manager for Mongolia.

The report takes a closer look at public investment programs implemented over the past five years, which surged until 2015, contributing to large increases in public finance deficits and the public debt. Mongolia needs to review and reshape its public investment policies and decision-making processes to improve efficiency of public spending, including clear project selection and prioritization criteria, as well as proper maintenance of existing assets.

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