Ankara: Digitally deliverable services (DDS) have surged to constitute 56% of global service exports, surpassing the growth of broader service trade over the past decade, as reported by the UN Conference on Trade and Development (UNCTAD).
According to Anadolu Agency, a recent UNCTAD report highlighted that while global services exports grew by 6.7% over the past ten years, they are expected to achieve an 8.3% growth by 2025. The trade in DDS has outpaced the overall sector, with an average annual growth rate of 7.1% over the last decade. This increase has been driven by the expansion of cloud computing, digital platforms, and enhanced connectivity infrastructure. The category of DDS includes insurance, finance, telecommunications, computing, research and development (R and D), management consulting, and architectural, engineering, and scientific services.
The report also underscored a significant technological divide, with digital services accounting for approximately 61% of total service exports in developed countries compared to a mere 16% in the least developed countries. Over the past decade, total service exports from the least developed countries have grown at an average rate of 3% annually. However, their share of total global service exports has diminished from under 1% in 2010 to 0.6% by 2025.
The disparity between developed and least developed countries is further illustrated by the report's artificial intelligence (AI) readiness index. Advanced economies achieved an average score of 0.65, developing economies scored 0.41, and least developed countries trailed with a score of 0.31. Notably, fewer than one-third of all developing countries have established a national AI strategy.
UNCTAD has urged emerging economies to invest in cross-border digital payment systems to prevent advanced AI from exacerbating existing inequalities. Additionally, investments in regulatory frameworks and targeted workforce skills are recommended.
Erdem Erkul, chair of the digital tech business council at Trkiye's Foreign Economic Relations Board (DEIK), conveyed to Anadolu that the UNCTAD data illustrates the transformation in global trade over the past decade. He explained that physical manufacturing alone is insufficient as modern products across nearly every sector are integrated with supplementary software, data, and digital services. Erkul emphasized that a nation's competitive edge will hinge on its ability to incorporate technological and service value into its goods.
Erkul further noted that while AI holds the potential to widen the global wealth gap, it also offers developing countries an opportunity to reduce the cost of producing and exporting digital services. He highlighted that AI can enhance efficiency across various sectors and enable small companies to access global markets. However, he cautioned that key inputs for AI, such as data, financing, expert human resources, and high computing capacity, are concentrated in a limited number of countries and firms. He advised developing nations to focus their AI development on their areas of expertise.
In the context of Trkiye, Erkul suggested that solutions developed for quality control, energy management, and maintenance in factories could be brought to global markets, transforming the country's expertise into exportable digital products and services.