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European concerns over data privacy decline- Report

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A new report by IE University’s Center for the Governance of Change (CGC) highlights profound shifts in European sentiments to technological change, particularly in light of the Covid-19 pandemic. To discuss the findings, a live webinar was held on June 1st which included a panel of experts and research contributors.

European Tech Insights 2020 is the second edition of a report by the CGC that focuses on European perceptions of technology and the future. The survey was conducted in January this year, and then again in April, involving 2,883 different respondents from 11 countries.

In his opening remarks for the online event, Diego del Alcázar, the co-chair for the CGC and executive vice-president of IE University, wanted people to know that this year the information had even greater relevance and resonance.

“Given the Covid-19 situation, we have been able to include data on the impact of this year’s disruption, making this survey of maximum interest,” he said.

The second round of questions was conducted in 4 countries, those considered the hardest hit by the pandemic at the time:  Spain, Italy, and for comparison, China and the United States.

Questions related to topics such as the future of work and automation, the growth and regulation of technological companies, the gig economy, global supply chains, and climate change.

Some of the Key Findings

While the researchers compiled a list of the key findings, 3 areas in particular received focused attention during the discussions of the webinar.

Concern for data privacy has decreased

In Italy and Spain, 79% and 67% of people respectively support a Chinese-style restrictive tracking system, something that many people might find surprising. Additionally, after COVID-19 arrived in Europe, the number of citizens who agree to share their personal data for health reasons has grown by an additional 11% in Spain and 13% in Italy.

Support for laws limiting automation has increased

After the onset of the pandemic, support for limiting automation doubled in China, from 27% to 54%, and there was a 33% increase in Spain. The researchers suggested that anxiety over a weakening job market is a likely explanation.

Europeans favour regulation and higher taxes for Big Tech companies

Europeans are increasingly concerned about the big tech giants: 31 % of Europeans believe that governments should limit the size or even deescalate companies like Google, Apple, Facebook, and Amazon because “they are bad for competitiveness and democracy.”

A further 45% of Europeans find it “ethically regrettable” to use services like Uber and Deliveroo due to the way these companies treat their workers. More than half of these respondents are in favour of forcing such companies to comply with the same work regulations as traditional companies.

Expert discussion

Privacy and freedom of movement

“The first thing that we found is that Covid-19 is decreasing concerns about privacy. We saw clear support for a Chinese-style tracking system…[which] entails a significant degree of restriction of freedom of movement, but also surveillance of personal information,” one of the authors of the report, the webinar animator and academic director of the CGC, Dr Oscar Jonsson explained.

Another finding was that the pandemic has made people more willing to reduce their privacy for either growth or for public safety reasons: questions were framed around job creation or security concerns, such as combatting terrorism.

Data privacy seems to be something that is very easily conceded, explained another of the report’s authors, Dr Carlos Lastra-Anadón, who is assistant professor at the School of Global and Public Affairs, and research coordinator of the CGC.

Doctor Lastra believed that when you are talking about how more data might help to grow the economy or to enhance public safety, people seem to have become less concerned about privacy.

“Whether this is a permanent change or not, is hard to say. My take is that the concern about data privacy is something that is rather abstract. It’s like dessert: optional, particularly for young people,” he said.

“As soon as things get serious, it’s basically the first thing that goes away,” he said, adding that he would be surprised if the public continued to be concerned over the next few years about data privacy.

Automation

Certain disparities are present in the data regarding automation. While Europeans under 55 show a willingness to limit automation to safeguard jobs, those over 55 are less worried, and in fact the majority of them are against such legislation.

Most European countries are split with the exception of France, where a strong majority of citizens, some 59% of them, are “very willing” to limit automation.

These attitudes have notably shifted in some of the countries worse affected by the pandemic.

“What I found particularly interesting to see was the change in sentiment in China…on a backdrop of an economy that has expanded enormously, in large part, due to manufacturing and the adoption of robots,” Dr Carl B. Frey, an economist, economic historian, and contributor to the report, explained during discussion.

Creative destruction in employment can be an extremely painful process for society, especially if it coincides with other issues, Dr Frey explained, adding that naturally “during recessions and economic downturns, sentiments towards automation tend to become more sour.”

Regulation on Big Tech

On attitudes towards large technology companies, the researchers said that they had seen a very interesting difference between the US and China, where most of the big tech companies are located, as compared to Europe, which has an ongoing problem with the lack of big technology companies.

In Spain and Italy, the survey found that there was majority support for taxing big tech companies in order to finance the economic recovery after Covid-19. On the other hand, in the US and China, respondents believed that either all companies should share in the burden, or there should not be additional taxes imposed in order to manage the economic fallout.

“In general, Europeans were more willing to regulate, limit, deescalate tech than the Chinese and the US,” summarised Dr Oscar Jonsson.

Europeans not having any of the large tech companies means that they are more eager to tax and regulate them than the Chinese and the Americans are, Dr Frey observed.

“And I think that that’s only natural: the asymmetries when it comes to tech companies mean that different places have very different stances and attitudes on them,” he said.

When asked if he thought that regulation was something that might be preventing the development of large, successful technology companies in Europe, Dr Frey expressed scepticism.

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4 million jobs added to Nepal’s economy in the past decade -Report

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Nepal’s economy added nearly four million jobs over the past decade, and average job quality increased significantly, according to the World Bank’s recent Nepal Jobs Diagnostic report.  But continued job creation, especially of wage jobs, is needed to absorb underutilized workers into better-quality, stable, and well-paid jobs. The economic disruption caused by the COVID-19 pandemic – while not addressed in this report – highlights the importance of increasing stable and secure employment in the post-pandemic recovery period.

Nepal’s economy has been gradually shifting from largely subsistence agriculture to more modern industry and services, and this structural transition is bringing better work opportunities for the labor force. Despite great strides, not all job seekers are able to access quality jobs, especially women. In the last decade, large numbers of men have entered jobs in construction, manufacturing, commerce and transportation, or have migrated abroad. Even though many of these are informal jobs or temporary wage jobs, they are nevertheless more productive and provide improved livelihoods compared to traditional low-productivity farm work. Women, on the other hand, have not transitioned in significant numbers. The share of wage work in Nepal jumped from 17 percent to 24 percent of total employment between 2008 and 2018, as nearly half of the jobs added since 2008 were wage jobs.

The shift toward wage employment signals a fundamental change in Nepal’s economic development and is similar to patterns seen around the world. As economies diversify their production activities and increase scale economies, employment becomes more specialized and more productive, and jobs are increasingly based in firms rather than self-employment, and pay more,” stated Dr. Elizabeth Ruppert Bulmer, World Bank Lead Economist and main author of the report. “Urbanization amplifies these effects by concentrating economic activities while increasing the variety of products and services.”

Evidence from a combination of data sources – national labor force surveys from 1998, 2008 and 2018, the 2018 Economic Census, and a 2019 survey of 900 SMEs across 6 districts – points to a number of constraints to achieving better labor market outcomes in Nepal. One key impediment is Nepal’s dramatic topography, which makes access to wage jobs and to product markets costly. Most jobs are informal and concentrate in relatively low productivity sectors, while most firms are micro-sized with one or two employees, and target small local markets rather than exporting or connecting to regional or global value chains. In addition to credit constraints, many SMEs cite tax regulations, high taxes, scarce skills, and bureaucratic inefficiencies as obstacles to growth and therefore job creation.

Gendered social norms have limited female labor mobility and work opportunities, reflected by the fact that most women remain in unpaid work. Three-quarters of new jobs taken up by women between 2008 and 2018 were in non-wage self-employment or unpaid family work, much of which was farm work. Occupational segregation and social norms contribute to the large earnings gap between men and women, as per the report.

In order to improve job outcomes in Nepal, the report recommends policies focusing on fostering SME productivity and growth; improving the business environment and labor market policies; increasing the individual, family, and economy-wide benefits of international migration; and preparing and connecting women and youth to better jobs, including entrepreneurship.

While the report does not address the shocks from COVID-19 experienced by Nepal’s economy and its people, it underscores the imminent priority for Nepal to save livelihoods of the most vulnerable workers, including those in subsistence agriculture and urban and rural informal day laborers or self-employed workers who lost their income sources,” states Faris Hadad-Zervos, World Bank Country Director for Maldives, Nepal and Sri Lanka. “The Government of Nepal has already initiated programs including the Youth Employment Transformation Initiative Project to address the immediate labor market challenges, and it is hoped that this analysis will further guide policy interventions to improve job outcomes as part of Nepal’s resilient recovery efforts from the crisis.”

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Promoting Wellness Key to Developing Asia’s Post-COVID-19 Recovery

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Policies that promote and facilitate health and overall wellness are vital for Asia and the Pacific’s recovery from the coronavirus disease (COVID-19) pandemic, according to the theme chapter of the Asian Development Outlook (ADO) 2020 Update released by the Asian Development Bank (ADB) today.

On top of the obvious health risks, the COVID-19 pandemic has increased inactivity, stress, and anxiety as lockdowns and layoffs heighten isolation, uncertainty, and economic hardships. The theme chapter, Wellness in Worrying Times, examines how wellness can help rebuild the human mind and body, and contribute to rebuilding the economy.

“Wellness involves the pursuit of activities that lead to holistic health, happiness, and well-being,” said ADB Chief Economist Yasuyuki Sawada. “The pandemic has had a significant negative impact on physical and mental health, and governments should incorporate wellness-promoting policies into their recovery plans to promote economic growth that will benefit both individuals and society.”

The report identifies a set of wellness measures across a range of policy domains including a healthy built environment, public infrastructure for physical recreation, healthy diet and nutrition, and a safe and healthy work environment. It explores how measures in these areas can contribute towards the region’s recovery from the pandemic and emphasizes the importance of a lifespan approach to wellness to safeguard long-term mental and physical health.

Governments in the region can support public infrastructure that promote wellness including walkways, bicycle lanes, parks, recreation centers, and free sporting facilities. This will increase the number of people who participate in recreational physical activities on a regular basis—currently at 33.2%—making them healthier. Public infrastructure and programs for wellness are especially important for poorer Asians, who usually lack access to private wellness facilities such as fitness centers.

Governments should also encourage healthy eating by improving consumer information and awareness of nutrition and diet. For instance, some governments in the region are already imposing higher taxes on sugary drinks and tobacco products, combined with regulations on nutritional information disclosure for food and beverage products and public awareness campaigns. This is important given that annual direct medical costs due to obesity are estimated at 0.8% of the region’s gross domestic product (GDP). Pursuing universal health coverage can amplify the benefits of wellness for all Asians.

Lastly, governments in Asia and the Pacific should strive to ensure a safe and healthy physical work environment for workers, especially in a post-COVID-19 scenario. In 2018, an estimated 2.3 million people died from work-related accidents and diseases worldwide, with the region accounting for over two-thirds of the total. The report notes that workers’ happiness can improve by 0.15 units (on a scale of 1 to 10) if per capita workplace wellness spending doubles from the $11 global average to $22—which could lead to increased productivity and output.

Wellness is a big part of the global and regional economy, highlighting its potential role in post-COVID-19 recovery efforts. Wellness-related industries account for about 5% of global GDP or $4.5 trillion in 2018, and about 11% of developing Asia’s GDP in 2017—and this is growing by about 10% annually. Wellness tourism, for instance, employed 3.74 million people in India, 1.78 million in the People’s Republic of China, and 530,000 in Thailand in 2017.

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Developing Asia’s Economic Growth to Contract in 2020

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Economies across developing Asia will contract this year for the first time in nearly six decades but recovery will resume next year, as the region starts to emerge from the economic devastation caused by the coronavirus disease (COVID-19) pandemic, according to a report released by the Asian Development Bank (ADB) today. 

The Asian Development Outlook (ADO) 2020 Update forecasts -0.7% gross domestic product (GDP) growth for developing Asia this year—marking its first negative economic growth since the early 1960s. Growth will rally to 6.8% in 2021, in part because growth will be measured relative to a weak 2020. This will still leave next year’s output below pre-COVID-19 projections, suggesting an “L”-shaped rather than a “V”-shaped recovery. About three-quarters of the region’s economies are expected to post negative growth in 2020.

“Most economies in the Asia and Pacific region can expect a difficult growth path for the rest of 2020,” said ADB Chief Economist Yasuyuki Sawada. “The economic threat posed by the COVID-19 pandemic remains potent, as extended first waves or recurring outbreaks could prompt further containment measures. Consistent and coordinated steps to address the pandemic, with policy priorities focusing on protecting lives and livelihoods of people who are already most vulnerable, and ensuring the safe return to work and restart of business activities, will continue to be crucial to ensure the region’s eventual recovery is inclusive and sustainable.” 

A prolonged COVID-19 pandemic remains the biggest downside risk to the region’s growth outlook this year and next year. To mitigate the risk, governments in the region have delivered wide-ranging policy responses, including policy support packages—mainly income support—amounting to $3.6 trillion, equivalent to about 15% of regional GDP.

Other downside risks arise from geopolitical tensions, including an escalation of the trade and technology conflict between the United States and the People’s Republic of China (PRC), as well as financial vulnerabilities that could be exacerbated by a prolonged pandemic.

The PRC is one of the few economies in the region bucking the downturn. It is expected to grow by 1.8% this year and 7.7% in 2021, with successful public health measures providing a platform for growth. In India, where lockdowns have stalled consumer and business spending, GDP contracted by a record 23.9% in the first quarter of its fiscal year (FY) and is forecast to shrink 9% in FY2020 before recovering by 8% in FY2021.

Subregions of developing Asia are expected to post negative growth this year, except East Asia which is forecast to expand by 1.3% and recover strongly to 7.0% in 2021. Some economies heavily reliant on trade and tourism, particularly in the Pacific and South Asia, face double-digit contractions this year. Forecasts suggest that most of developing Asia will recover next year, except for some economies in the Pacific including the Cook Islands, the Federated States of Micronesia, the Marshall Islands, Palau, Samoa, and Tonga.

The inflation forecast for developing Asia is revised downwards to 2.9% this year from 3.2% forecast in April, due to continued low oil prices and weak demand. Inflation for 2021 is expected to ease further to 2.3%. 

The update to ADO 2020 features a theme chapter, Wellness in Worrying Times, which discusses the importance of wellness as communities recover from COVID-19’s toll on physical and mental health. The chapter explains that wellness can be an engine of inclusive economic growth if the region leverages its rich wellness traditions, and appropriate policies are promoted by governments. 

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