Strengthening digital economy is the way to go

24 May 2020 12:08 AM
China and South Korea were the early frontlines in our pitched battle against Covid-19. Both countries had taken the hardest hit through the initial phase of the outbreak, but both were quick to rebound from the initial shock of it and soon cornered the mortal enemy with the swift stroke of their digital weapons.

With a solid technological backbone, they have already been able to support the Covid-19 outbreak efficiently. And the same resilient digital infrastructure has aided both of these countries within their attempts to cushion their economies from the aftershocks of the pandemic.

For just one, the faster they contained the outbreak, the earlier they were able to get their economics back on track towards recovery. Some countries remain under lockdown, China and South Korea are opening up their economic activities and may likely lead all of those other world within their attempts to regenerate their economies after they have overcome the original shock of Covid-19.

China, a nation whose way to ecommerce had been paved in 2003 by the SARS outbreak, as suggested by World Economic Forum, was well-equipped to fight the monetary challenges posed by the Covid-19 lockdown. As the SARS outbreak triggered a shift in consumer behaviour-more online shopping, increased digital payments-China's already flourishing ecommerce platforms were better in a position to align their supply chain logistics to serve the needs and demands of the consumers holed up within their homes.

According to a WEF report, "because the outbreak of Covid-19, the brand new infrastructure has played a critical role in China's overall economy. Retail platforms predicated on a good supply chain make certain that the way to obtain products accurately matches people's needs. Dependable and fast delivery helps guarantee the stability of tens of millions of families."

And China was quick to embrace further innovations that not merely helped the wheels of the economy turn by facilitating commerce, but also assisted in enforcing social distancing: non-contact services and AI robots for delivery.

In late January, among China's greatest providers of delivery services for food, consumer products and retail services-Meituan-launched a non-contact delivery service where parcels could possibly be sent to customers while strictly maintaining social distancing rules. Soon, in lots of parts of China, AI robots were used for package delivery services, security services, disinfection services and so forth, putting fewer lives at risk, while at the same time going about addressing the most pressing needs of the people and the time.

All these have been enabled by the political will of the Chinese policymakers and private-sector leaders in strengthening their digital economy through buying advanced and resilient digital infrastructure.

The united states, however, did have problems with economic shocks, using its GDP contracting by 6.8 percent year-on-year through the first quarter of the entire year. But with faster suppression of the Covid-19 outbreak with the aid of its cutting-edge digital innovations, it is now able to accelerate its monetary activities again.

For countries such as for example Bangladesh, who've already committed to digital technologies and also have the essential digital infrastructure in place-4G internet, ICT substructure, a flourishing ecommerce industry, multiple digital payments platforms, etc.-they is now able to consider working on these foundations to gear up their monetary activities in the medium to long haul to achieve their monetary ambitions.  

Consumer behaviour is undergoing a shift in Bangladesh in response to the pandemic. According to E-Commerce Association of Bangladesh (E-CAB), almost 100 ecommerce businesses dealing mostly in healthcare supplies, groceries, and essential commodities have witnessed a growth popular, as more consumers, who had previously not considered online purchase, had to opt for it through the shutdown.

But with an increase of ecommerce and digital payments demands, the regulators, industry leaders and companies have to interact to ensure a host in which the trust that consumers place in ecommerce businesses, digital payments platforms and smart suppliers isn't shaken. All the stakeholders in this ecosystem have to work together to ensure that the machine becomes sustainable over time. For this to occur, the retail supply chains must be made smart, digital logistics ought to be further strengthened, and the political will of most concerned needs to be demonstrated though meaningful action.

With Covid-19 continuing to wreak havoc worldwide, economies will suffer tremendously-there is no chance from it. And countries such as for example Bangladesh whose economy is heavily dependent on exports earnings will have additional obstacles to overcome within the next few months, as a result of declining global demands for apparel. Moreover, with the global oil prices plummeting, the fate of the Bangladeshi migrant workers-whose remittance keeps its forex reserve strong-looks pretty uncertain right now. This will be an added burden on Bangladesh in the years ahead.

But with strategic investments in strengthening digital economy, the united states can bolster domestic demands and keep carefully the wheels of the economy turning faster.  

But accurately how fast the country's economy can and can recover is up to the policymakers, regulators and industry leaders. What's needed can be an open-minded method of embrace digital innovation and transformation. That is one challenging goal, but it is achievable. We are able to look to countries that are on the path to monetary revival and take the cue from them.