29 March 2021
World Development Report Urges Strengthened Systems to Tackle Data Inequalities
Photo by Austin Distel on Unsplash
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The 2021 report stresses the urgency of equitable access to data and improving data governance, and highlights the need to strengthen cybersecurity and protect personal data.

The report proposes working towards “a new social contract for data” that is grounded in principles of equity, trust, and value.

The World Bank’s World Development Report 2021 calls for strengthened national data systems to tackle poverty and transform the lives of the world’s poor people. The report examines how data can better advance development objectives, and analyzes the types of governance arrangements necessary to support data generation and use that is ethical, equitable, safe, and secure.

The publication titled, ‘World Development Report 2021: Data for Better Lives,’ highlights the potential of data to support development while emphasizing challenges in inclusivity. World Bank Group President David Malpass said the “perspective of poor people has largely been absent from the global debate on data governance” and urgently needs to be heard. A lack of institutions, financial resources, and decision-making autonomy in low-income countries “hold back … the effective implementation and effectiveness of data systems and governance systems,” he observed.

The report showcases examples of how better data and data systems can improve lives and enhance governments’ abilities to prioritize and target resources more efficiently. In Haiti, for instance, mango farmers are using technology to track their produce through to final sale, which has eliminated intermediaries and increased their share of the profit. The private sector is also using data to power platform-based businesses that generate international trade in services and boost economic growth.

The report notes COVID-19 has underscored opportunities and challenges associated with data use, and stresses the urgency of equitable access to data and improving data governance. Shifts to virtual work have illustrated the digital divide between those with and without access to technology, underscoring challenges related to inequitable access to mobile phones and the internet for the poor and low-income countries. World Bank Chief Economist Carmen Reinhart emphasized innovative uses of data “offer new opportunities” to understand COVID-19’s spread, assess policies to mitigate the pandemic, and “target government resources to the people most in need.”

However, the report warns, data accumulation can also lead to a concentration of economic and political power, raising concerns that “data may be misused in ways that harm citizens.” During the COVID-19 pandemic, for example, countries have repurposed mobile phone records to monitor the virus’s spread, a practice that could lead to a risk of misuse or privacy concerns. The report highlights the need to strengthen cybersecurity and protect personal data. It finds governance arrangements to address data concerns “remain in their infancy, particularly in low-income countries.” A global survey of 80 countries found only 40% of countries have best practice data regulations in place. Sub-Saharan Africa has low digital connectivity, and “modern infrastructure for exchanging, storing and processing data is negligible” in low-income countries.

The report also features a chapter on the role of competition, trade, and tax policy in creating value in the data economy. While trade in goods has remained stable over the last decade, the report finds global trade in data-driven services, such as telecommunications, finance, and other business activities, “has grown exponentially.” Global data flows “multiplied more than twentyfold between 2007 and 2017,” and are expected to approximately quadruple from 2017 to 2022. Global trade in data-driven services now makes up half of trade in services. The report observes a variety of multilateral, regional, and bilateral forums are now addressing digital trade, including through the World Trade Organization’s (WTO) joint statement initiative (JSI) on electronic commerce, and underscores the role of policymakers in promoting the sharing and transfer of data in ways that support the economic benefits of digital trade while ensuring the security of sensitive information and personal data protection.

To address data inequalities, the report recommends prioritizing marginalized people’s improved representation in and access to data, and improving data governance domestically. It further recommends international cooperation harmonize policies to ensure the value of data is harnessed to benefit all and inform actions towards a green, resilient, and inclusive COVID-19 recovery. In particular, the report proposes international engagement on WTO arrangements for trade in data-enabled services, reform of international taxation rights for data-driven businesses, regional collaboration on the development of data infrastructure, bilateral collaboration on law enforcement and antitrust regulation, and harmonization of technical standards to support interoperability. The report emphasizes these actions are critical to work towards “a new social contract for data” that enables the use and reuse of data to create economic and social value, fosters citizens’ trust that they will not be harmed by the misuse of data they provide, and promotes equitable opportunities to benefit from data. [Publication: World Development Report 2021: Data for Better Lives] [Report Landing Page] [Report Main Messages] [World Bank Press Release on Data Systems] [World Bank Press Release on Report Forward]

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