Menu Close

The pandemic and the acceleration of digital transformation: Challenges and opportunities

Previously in this collection of Pandemic and Acceleration of Digital Transformation, three aspects have been discussed. First, an acceleration forced by circumstances, in which the pandemic accelerated the transformation processes that were already underway in the countries of the region. Second, the interviewees talked about the uneven impact of digital growth in Latin American countries and industries. Third, the role of public policies in this context was discussed. To conclude this collection, Raúl Echeberría -Executive Director of ALAI-, Ernesto Bojórquez -NIC Mexico’s CEO- and specialists from the eLAC-ECLAC Technical Secretariat reflect on the challenges and opportunities presented by this unusual context.

Lockdown measures are being followed by measures to come back to normal and revive the economy. Our interviewees agreed that this is a key opportunity for governments and industries to harness and maintain the impulse of the digital acceleration.

“Many business models, work methods and ways of interacting will not be the same after the current crisis. I hope policy makers, authorities and also several sectors take notice of the opportunities this situation is creating for us to enter the already digitalized world,” Echeberría pointed out. He then added, “Without digital development, there will be no economic recovery or development. It is imperative that public policy be consistent in the pursuit of these objectives.” 

eLAC-CEPAL saw eye to eye on this and stated, “As a result of the crisis, there will be significant innovation cycles that must be supported. From the beginning of the pandemic and in response to it, there have been several initiatives launched by different sectors. The pandemic has accelerated the ‘tests’ of many emerging technologies. In this context, it is expected now more than ever that the use of such technologies be decisive for the recovery of the sector and the new production and innovation cycles.”

“The development of e-commerce and the overall digital transformation are great opportunities to boost the economies of our countries despite the backwardness they have always endured. While this transformation requires appropriate infrastructure and expertise, it is not as capital-intensive as other industries. Therefore, it is feasible for a great number of companies to participate in the digital economy and transform their businesses in order to thrive,” Ernesto Bojórquez pointed out.

However, the opportunities for innovation come with concrete challenges for Latin America.

First, it is necessary to make efforts to prevent existing gaps from widening. In Echeberría’s words, “The first lesson we can learn from the pandemic today is that digital transformation is possible and is already happening. The second one is that the challenges to achieve such transformation are different across the region.” Moreover, our interviewees agreed that it is necessary to reconsider the regulatory models, which in many cases are out of date and put up barriers to digital development, instead of fostering it.

“The digital transformation process will require  an infrastructure evolution over time. It will also be necessary to implement an educational  process on the different components of the digital world. Finally, laws must evolve to offer a regulatory framework that complements and promotes the digital transformation process,” said Ernesto Bojórquez.

According to eLAC-CEPAL, “Recovery initiatives must pay special attention to solve fundamental issues in the promotion of e-commerce and the digitalization of production, such as the digital infrastructure, an appropriate regulatory framework, the lack of capacities in companies, the penetration of digital payment methods, the trust of online consumers and the correct operation of logistic services.”

Echeberría concluded that, “The need to revive the economy in the short term is pressing, but we have to achieve a non-adversarial recovery that is consistent with our strategic objectives of digital development. The opportunities for the region are unique, and we have to be ready to seize them”.

– The original post was published in the LACTLD Report No. 12