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A new report by the United Nations Conference on Trade and Development (UNCTAD), Digital Economy Report 2021, says two countries – US and China – account for 90 percent of the market capitalization of the world’s largest digital platforms.

“The US and China are the frontrunners in harnessing data,” UNCTAD said in a statement it sent to Financial Nigeria. “They account for 50% of the world’s hyperscale data centres, the world’s highest rates of 5G adoption, 70% of the world’s top artificial intelligence (AI) researchers and 94% of all funding for AI startups.”

The report warns that a data-related divide is emerging as the data-driven digital economy evolves, resulting in many developing countries becoming mere providers of raw data to global digital platforms, while having to pay for the digital intelligence generated from their data.

Warning against fragmentation of the governance of the internet, the report says that the world needs a new global governance approach to enable digital data to flow across borders as freely as necessary and possible, adding that the new approach should help maximize development gains, ensure those gains are equitably distributed and minimize risks and harms.

“It is more important than ever to embark on a new path for digital and data governance,” says UN Secretary-General António Guterres in his preface to the report. “The current fragmented data landscape risks us failing to capture value that could accrue from digital technologies and it may create more space for substantial harms related to privacy breaches, cyberattacks and other risks.”

The report says the Covid-19 pandemic has reinforced the increasingly important role digital data plays in an economic and as a strategic resource. During the ongoing pandemic, the importance of sharing health data has been underscored in the areas of helping countries to cope and research for finding vaccines.

The report proposes the formation of a new United Nations coordinating body, with a focus on, and with the skills for, assessing and developing comprehensive global digital and data governance. It says the work of such a body should be multilateral, multi-stakeholder and multidisciplinary.

According to the report, the current global context is characterized by diverging approaches to data governance, notably by the three leading players – the United States, China and the European Union (EU). The US approach focuses on control of data by the private sector, the Chinese model emphasizes control of data by the government, while the EU favours control of data by individuals, based on fundamental rights and values.

“We need a new regulatory framework that factors in both economic and non-economic dimensions, and that can work for countries at different levels of digital readiness,” UNCTAD’s director of technology and logistics, Shamika N. Sirimanne, said.