IMD World Digital Competitiveness

Figure 4: AI Contribution to GDP in 2024 Source: PWC

The role of artificial intelligence in national competitiveness AI is going to create efficiency gains, new business opportunities, new jobs, and therefore prosperity and economic growth. Our analysis above describes the risks –social, regulatory, and environmental–brought about by AI. But it seems that, on balance, AI is going to be a driver of prosperity and economic growth. Estimates by PWC shown in Figure 4 indicate that in countries like China, the AI-related economy could represent more than 25% of GDP in 2030.

national, and global level. Therefore, governments must impose some of the costs of AI development on compa nies, either through taxes or by creating ecosystems where companies share some of their gains with society. 3. Those nations that are reluctant to abide by global rules must realize that it is in their own interest to have a global system that provides guidance and transpar ency. Otherwise, in a world of winners and losers, the Luddites will triumph and there will be soon a technology backlash where society will demand a return to a more human, less technology-centered, economy. 4. The efforts to regulate AI at the global level cannot be led by the United Nations. The UN has proven to be an obsolete organization based on a political system that emerged at the end of the Second World War and that gives a dominant position to countries that have lost relevance in the global economy, such as France and the UK, against other countries whose economies are bound to dominate in trade and technology in the 21 st century, such as India, Saudi Arabia, and Brazil. 5. The main objective of AI, as with any other technology, is to increase human prosperity: that is, quality of life, life expectancy, availability of jobs, decent salaries, possibilities for education and healthcare and available infrastructure in a green economy. It is not to increase stock prices and replace jobs. Ultimately, AI must be able to make countries more competitive–otherwise, it is simply not a desirable technology.

Notwithstanding, our key message this year is AI is going to create winners and losers, given the fact that even if the net effect of technology is an increase in the number of jobs available, these will benefit those countries that are currently massively investing in AI, and this will be at the expense of “poorer-AI” countries. A system of global governance could help alleviate such inequalities. And this is not unrealistic, but how could we really help make it happen? To conclude this report, let us propose some guidance for such a global governance system: 1. AI governance cannot leave any country behind and must include the needs for better technology and infra structure in emerging markets. The objective of such a global system must be to increase global prosperity. This will require some countries to make some sacrifices, particularly the more AI-developed ones. 2. Regulators must balance corporate interests to reduce costs and increase efficiencies with the national interest of employment generation and prosperity. What is good at the micro level may not be optimal at the aggregate,

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