Digitisation and 24-hour economy - Substitutes or complementary development strategies?
The Vice-President and flag bearer of the New Patriotic Party (NPP), Dr Mahamudu Bawumia, said in his 2024 New Year message to Ghanaians that the NPP government will continue to develop a modern and resilient economy driven by digitisation (Yirenkyi, 2024).
Juxtaposing that statement with the 24-hour economy proposed policy of the former President and the flag bearer of the National Democratic Congress (NDC), John Dramani Mahama, I foresee “a resilient 12-hour digitised economy” and “a 24-hour economy” development strategies dominating the campaign promises of the two leading political parties towards the 2024 general election.
Though the two economic development strategies are already ongoing, the focus of the two leaders is to entrench and expand their operations to have a much greater impact on the Ghanaian economy.
In a previous article of December 18, 2023, titled A 24-Hour Ghanaian Economy: Realism versus Erroneousness, I pointed out some of the many benefits that will accompany the running of a 24-hour economy, notwithstanding its challenges.
I recommended, among other things, that Ghana needs to heighten its digital transformation efforts as a part of the solutions to solving the anticipated problems and enhancing its workings.
The objectives of this article are to: without political colours, weigh the benefits and deficiencies of a digital economy; reveal that digitisation complements other economic growth policies and moderates their effects on economic activities and the quality of human lives in either a 12-hour or a 24-hour economy; and emphasise the significance of treating the two development policies equally with the urgency they may deserve.
A "digitised economy" is one in which digital technologies (infrastructure, equipment, products and platforms) drive economic, legal, political, social, religious and global activities among economic agents and sectors.
The digital economy is also about electronic government, industry, education, agriculture, services and infrastructure.
According to Yasar & Pratt (2023), a digital economy results from technological advancements such as the internet, blockchain, virtual reality, artificial intelligence (AI), etc.
The reliance on digital technologies sets the digital economy apart from the traditional economy.
A digitised economy has several benefits for the attainment of a country’s growth and development, some of which are as follows:
The digitisation of the economy creates jobs for highly skilled workers who can use technology to increase efficiency and productivity at work.
According to Mandl (n.d.), digitisation technologies increase employment opportunities for specialists in technology, software developers and educators, experts in content and design, data scientists and analysts, statisticians, machine learning engineers, and artificial intelligence (AI).
Enhancing digital literacy and providing high-quality digital connectivity infrastructure can help public and private sector organisations and individuals fully capitalise on the opportunities digitisation presents to an economy, maximising business profits, and customer satisfaction and retention.
According to Muciaccia (2020, cited in Muciaccia & Tedeschi, 2023), the spread of Internet of Things (IoT) technology, such as 5G, is predicted to turn houses, buildings, infrastructure, and cities into "smart homes," "smart buildings," "smart infrastructure," and "smart cities.".
Furthermore, because digitalisation increases openness and improves the quality and efficiency of corporate and national governance and household management, it has the power to subdue corruption.
It is a system that generates and processes invoices, receipts, and payments for goods and services electronically with little or no human intervention, resulting in accurate transactions and accountability.
The Ghanaian economy's ports, energy, banking, education, and other government and corporate sectors now conduct business electronically, which lessens the opportunities and benefits from corrupt practices.
The reduction in money laundering activities and the removal of ghost names from government payrolls will maximise the gains in economic activities.
According to Takefuji (2023), digitisation and digital governance can reduce the prevalence of fraud.
A decline in digitisation and AI governance is typically correlated with an increase in fraudulent economic activities.
Additionally, digital systems and technologies have enhanced the effectiveness of tax administration and collection, raising government revenue for economic development.
Firms use digital or electronic payment platforms and tracking systems to file tax returns and keep track of their output, sales, imports, and export volumes.
Digital technology, according to Kitsios, Jalles, and Verdier (2020), offers the potential to reduce fraud and increase tax revenue for the government, and cutting the divide in half between the old economy and the frontier of digital transformation might boost revenue in low-income emerging economies above 1.5 per cent of GDP.
What is more, a digitised economy can lower crime rates through the installation of security gadgets like cameras in homes, offices, and vantage points in societies.
It also lowers costs and boosts the effectiveness of security measures involving people.
Traffic accidents are decreasing because drivers and pedestrians who disregard traffic safety laws are compelled to do so by the presence of digital street cameras.
Digital security systems have made the homes and offices of individuals and organisations more secure from break-ins.
These systems notify owners of attempted break-ins and fires in people's homes and offices, allowing for prompt police and fire service personnel responses and the preservation of properties and lives.
Digitisation facilitates domestic and international trade because it increases the ease of accessing markets and helps transact business activities online.
Digitisation facilitates better relations, efficient communication, transactions and business activities.
Technology such as the internet makes it easier for firms, individuals and governments to interact with their counterparts within and without an economy.
Firms leverage social media channels such as Facebook, WhatsApp, LinkedIn, Google, cell phones, emails, Twitter, Instagram, etc., to enhance seller-customer interactions.
This process helps parties avoid the high costs and dangers of actual travel.
Also, there are prompt, simple and quick payments for goods and services.
The writer is a Senior Lecturer/Dean, Faculty of Humanities and Social Sciences, Wisconsin International University College.