Azerbaijan Moves Toward Enhancing Digital Economy

(MENAFN- AzerNews)

Ulviyya Shahin Read more

The digital economy refers to the economic activities that are primarily based on digital technologies, including the production and consumption of digital goods and services. The growth of the digital economy has been significant in recent years, driven by advancements in technology such as the internet, cloud computing, artificial intelligence, and data analytics.

Effective regulation in the digital economy indeed requires a collaborative effort among various stakeholders, including governments, businesses, and other key participants. Striking the right balance between fostering innovation and addressing regulatory concerns is essential for creating an environment that encourages economic growth while ensuring fair practices, consumer protection, and cyber security.

Here poses question: What has Azerbaijan accomplished and what steps should it take in this field?

British journalist and economist Neil Watson told Azernews that Moody's has highlighted Azerbaijani economic diversification as a boost for the banking sector and, for several years, the growth of the digital economy has rightly been one of the key development areas for the Azerbaijani government.

“This was recognised by the Asian Development Bank, which regarded it as a driver of economic diversification in a hydrocarbons-rich nation, and programmes have been developed by the OECD and World Bank, amongst others. This is particularly the case for education, as young people will grow up in a world where oil and gas is of reduced value, with digital skills being highly prized. For example, the Digital Skills Programme is now being taught in 202 Azerbaijani educational institutions. Not only does this transform the use of the latest technologies into second nature for students, but also education can be tailored to specifically meet their needs and abilities. This also eliminates any differences between city and rural schools.”

According to him, the digitalization of the work of public authorities via the e-gov platform and, most notably, the ASAN service, have enhanced efficiency and negated corruption.

“Digitalization is also regarded as the future of the liberated regions, where energy will be generated from sustainable sources, and the obvious industry will be related to the provision of IT services. Azerbaijan is undeniably the IT hub for the South Caucasus and has a higher level of reliable connectivity than many western countries, with a young population who are very receptive to digital services and solutions. It is destined to make the entire region reliant on Azerbaijan for internet service provision and, by so doing, this should positively impact cohesion between the three nations.”

“It will also control cyber security, countering malicious IT threats and misinformation from third countries. According to the World Bank, the Azerbaijani government is focusing on growth of the digital infrastructure, digital skills, digital platforms, digital financial services and digital entrepreneurship. In addition, the evolution of the digital economy is playing an integral role in the shift from megalithic state-run monopolies to privatised small- and medium-sized enterprises (SMEs), focusing on specific elements of the digital economy. The state is supporting this by improving SMEs' access to financial tools to facilitate entrepreneurship”, he added.

N. Watson said that in the UK, this has already occurred. He also gave a debrief about the growth of the internet in the UK back in the 90s.

“First of all, it should be remembered that the developer of the internet was Sir Tim Berners-Lee, a British scientist, and the growth of the internet coincided with the end of British manufacturing in the 1990s, after many years of decline. The growth of the internet and digital economy created endless new professions and companies in a de-industrialised nation, and the UK was a pioneer in the digital solutions which are used across the world. Every aspect of life in the UK has been impacted by the digital revolution. In 2020, the digital sector contributed GBP142.3 billion to the UK economy, and from 2010–19, the digital sector grew by a massive 66.6 per cent. The concentration of worldwide IT services in the UK is huge, and it secures the importance and influence of the country for the future.”

Economist stressed in the end that a healthy, developing and responsive digital is key to future success, and this is likely to be the case for Azerbaijan if it continues on its current trajectory.

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