'Huge digital divide blunts PHL'S gains from technology'

• Published date: 06 October 2020
• Publication title: Business Mirror

THE gaping digital divide in the Philippines is preventing more Filipinos from harnessing the benefits of digital technologies, according to a report by the World Bank and the National Economic and Development Authority (Neda).

The report, titled 'A Better Normal Under Covid-19: Digitalizing the Philippine Economy Now,' said around 60 percent of Filipino households do not have access to the Internet. This, despite findings by We Are Social that Filipinos spend 10 hours online daily.

World Bank Economist Kevin Chua, the lead author of the report, said in a briefing on Monday that most Filipinos rely on mobile data to connect to the worldwide web. Part of the reason is that digital connection in the Philippines is expensive, slow, and has a low broadband penetration rate.

'Internet connectivity-the foundation of the digital economy-is limited in rural areas, and where they are available, services are relatively expensive and of weak quality,' said Ndiame Diop, World Bank country director for Brunei, Malaysia, Philippines and Thailand.

'Upgrading digital infrastructure all over the country will introduce fundamental changes that can improve social service delivery, enhance resilience against shocks, and create more economic opportunities for all Filipinos,' he said.

Where Internet services are available, Filipino consumers experience slow download speeds. At 16.76 megabytes per second, the Philippines's mobile broadband speed is much lower than the global average of 32.01 Mbps.

In the region, the report said 3G/4G mobile average download speed stands at 13.26 Mbps compared to only seven Mbps in the Philippines. Chua said the most commonly used in the country is 3G, which is the lower version of Internet connection.

The World Bank also noted that efforts to enhance digital infrastructure in the Philippines are hindered by a lack of competition, as well as restrictions on investment in the telecommunications markets.

These restrictions include the public utility designation of telecommunications, which limits foreign ownership and places a cap on the rate of return.

'In this society-wide digital transformation, the government can take the lead by speeding up e-governance projects, such as the foundational identification system and the digitization of its processes and procedures, which will help promote greater inclusion, improve efficiency, and enhance security,' said Chua. 'Moreover, the government can take an active role in fostering policies that reduce the digital...