Digital Progress and Trends Report 2023

Digital technologies are transforming economies, creating jobs, and improving lives. They have dramatically changed communications, business, health, education, finance and more.  

Yet the digital divide remains stark and is becoming synonymous with a development divide. Billions of people around the world are still offline, and digital advancement has been uneven, exacerbating the gap between the digital haves and the have-nots.  

This report tracks global progress of digitalization and countries’ production and use of digital technologies, from digital jobs, digital services exports, and app development to internet use, affordability, quality, and more.  

The report also highlights policy shifts and debates, with a focus on developing countries.  Two clear trends have emerged that are shaping our digital future: the importance of digital public infrastructure and the transformative emergence of artificial intelligence.

Closely measuring digital progress, especially in developing countries, will help policy makers and the private sector best direct their efforts to close the digital divide.  

Digital transformation can close the digital divide


Digital Services Sector Growth

The digital sector is an engine for economic growth and job creation, but the benefits are concentrated in a few leading economies.

The information technology (IT) services sector, such as tech consulting and software development, grew twice as fast as the rest of the economy, creating jobs at six times the rate of the global economy. But this phenomenal growth was highly concentrated, with the top six economies accounting for 70 percent of global value added in IT services.

Business Digitalization

Businesses in East Asia are racing ahead, embracing digitalization to engage online with customers, suppliers, and employees. Small firms in lower-income countries lag behind.

East Asia has been the clear front runner in business digitalization among developing regions, with the share of firms investing in digital solutions quadrupling from 13 percent to 54 percent between 2020 and 2022. In other regions, less than 30 percent of firms did so by the end of 2022.

From April 2020 to December 2022, the percentage of micro firms (zero to four employees) investing in digital solutions doubled from 10 percent to 20 percent but for large firms (more than 100 employees) it tripled from 20 percent to 60 percent.

While companies in high-income countries continue to integrate digital solutions to streamline processes and improve efficiency, many companies in low- and middle-income countries were without a computer or internet connection in 2022, particularly small and medium enterprises.

Local Digital Firms

Since the pandemic, the app market has become more local, especially in large countries with unique languages, strong cultural identities, and talented entrepreneurs.

Domestic digital firms in low- and middle-income countries are gaining momentum. These countries received an influx of venture capital funding for their online startups during 2020 to 2022. While the app market is also becoming more localized, homegrown success in these developing economies may not be transferrable to foreign markets.

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