Digital Technologies in the Public Sector — Integrating Digital Transformation

Understanding the supply and demand of public sector companies in digital transformation and innovation projects in middle-income countries.

Dipossum
3 min readApr 15, 2021

The World Development Report 2016: Digital Dividends study mentioned that the advent of the Internet in the mid-1990s triggered the rapid spread of e-government systems to automate basic administrative tasks, improve the delivery of public services and promote transparency and accountability. It is claimed that in 2014, all 193 member states of the United Nations had national websites: 101 allowed citizens to create personal accounts online, 73 to file income tax online, and 60 to register a business. In all, more than 150 countries have automated government finance, customs, and tax systems; although, only 20 countries have multipurpose digital IDs for services such as voting, finance, healthcare, transportation, and social security.

The study also provides data from the McKinsey Global Institute that estimates that 75% of the economic impact of the internet in 12 large developing and developed countries originates from companies in traditional sectors that invest in digital technologies to save costs by optimizing your production and management processes. The findings are consistent with studies showing that most of the productivity growth in the United States of America over the past 15 years originated in non-ICT (information and communications technology) sectors. Despite strong growth and high market valuations of internet companies offering services, to date their market shares in traditional sectors have been relatively small.
The same World Development Report 2016 mentions that the digital economy represents approximately 6 percent of gross domestic product (GDP) in OECD countries (Organization for Economic Cooperation and Development).

In the United States, which is home to some of the largest technology companies, the added value of ICT sectors in GDP is 7%. In 2016 Latin American countries like Peru, an investment in technology of 2.5% of GDP was achieved focused on the commercialization of PCs, tablets and smartphones, surpassing countries like Mexico and Argentina. Even so, it is low for a sector that increases national productivity ( IDC and Qualcomm, 2017).

The study also provides data from the McKinsey Global Institute that estimates that 75% of the economic impact of the internet in 12 large developing and developed countries originates from companies in traditional sectors that invest in digital technologies to save costs by optimizing your production and management processes.

The variable for measuring the source of growth of the countries is called Total Factor Productivity (TFP).

The World Development Report 2016 mentioned that employers are looking for professionals who work well in teams, who can solve problems, think critically and know how to present their work to others. However, in many countries, education systems do not even offer basic information, literature, and arithmetic at competitive levels. More than half of 15-year-olds are functionally illiterate in middle-income countries such as Albania, Indonesia, Jordan, Kazakhstan, Malaysia, and Peru.

As mentioned in the Report, the importance of achieving greater and accelerated digital adoption varies by country, it is still slow in the Latin American region, because access to, knowledge about technology and how to apply it properly is required.

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Dipossum

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