Melinda Gates with Go-Jek team members in Indonesia
Melinda Gates: US aid is critical for progress
01:45 - Source: CNN Business

Editor’s Note: Melinda Gates is co-chair of the Bill & Melinda Gates Foundation. The opinions expressed in this commentary are her own.

“Tech Companies Should Stop Pretending AI Won’t Destroy Jobs.” “The Tech Solutions to End Global Hunger.” Depending on which headline you read, you can get a very different idea of how technology is going to affect our future.

It’s enough to make your head spin. Neither extreme scenario rings true based on historical evidence or my own experience in business and global philanthropy.

When spreadsheet software was introduced in 1980, pundits predicted heavy losses for the accounting sector. And, in a way, they were right: Since then, the United States has lost 400,000 accounting jobs. What they didn’t predict, though, was that spreadsheets would also create customer service jobs — 600,000 of them.

Or take a more immediate example: our phones. They provide us almost instant access to more or less the entirety of human knowledge, but a lot of us are addicted to them in ways that make us more anxious and less empathetic.

Ultimately, technology is neither good nor bad on its own. It’s a tool, and what matters is how we use it. It’s up to businesses and governments to move past fearmongering and naïve optimism and get practical. Instead of wondering and waiting to see what the impact of technological change will be, they can guide it.

That’s exactly why the Pathways for Prosperity Commission on Technology and Inclusive Development exists. The commission— which I co-chair with Sri Mulyani Indrawati, Indonesia’s minister of finance, and Strive Masiyiwa, the founder of Econet Wireless — works to help business and government leaders in low-income countries make sure new tech is used for good, and especially for the good of the people who need it most.

Two recent reports by the commission make me optimistic. Their most important finding is that technological innovation is creating opportunities not just for poor people to become more prosperous, but for poor countries to grow their economies in entirely new ways. Entrepreneurs and policymakers in those countries need to understand those opportunities so they can seize them.

Conventional wisdom used to hold that there were two primary roads to prosperity for poor countries: manufacturing and natural resources. But the commission has identified several brand-new pathways for the modern era. For example, with the right support, subsistence farmers can use digital technology to build small- and medium-sized agribusinesses that drive GDP growth (not to mention improve nutrition). Similarly, by connecting entrepreneurs to business and government systems, technology is linking more people to the formal economy, thereby increasing their access to opportunities, social protections and other benefits – while also enabling governments to tax them to support important services like education and health.

Melinda Gates with Go-Jek team members in Indonesia.

The reports draw their evidence from changes that are already underway in countries around the world. Millions of Kenyans who had never had bank accounts before are using mobile phones to make payments, take out loans and establish credit histories through the M-PESA platform. People who fish for a living in the Indian state of Kerala were able to communicate better with customers using mobile phones, increasing profits by 8% on average.

I just traveled to Indonesia where I visited Go-Jek, a ride-sharing service that has increased drivers’ income by an average of 44%, while providing a higher-quality service for its customers. These examples are the building blocks of digitally powered economies that are more efficient, more inclusive, and, in the end, much more robust.

What do businesses and governments need to do to foster the kind of technological innovation that will allow people and nations to lift themselves out of poverty?

The first step is making sure that all people have access to digital technology, and right now billions still don’t. Take mobile phones. It’s true that mobile phone coverage now reaches an astonishing three quarters of the world. But for someone living under the poverty line in Tanzania, for example, a phone costs at least two months’ salary. In Guinea-Bissau, people pay a staggering $81 for 500MB of data — an amount that would last a long time for texting or WhatsApp, but would run out after streaming two or three movies. Digital technology won’t help fight poverty if simply acquiring it pushes people into poverty.

Expense isn’t the only obstacle. Many of the groups discriminated against offline face a similar divide when it comes to technological innovations. According to analysis from the Pathways for Prosperity commission, in developing countries, entrenched gender norms mean that women, regardless of their age, education, wealth, or location, are almost 40% less likely than men to have used the Internet. In India, these same patterns of discrimination mean that women are about half as likely as men to use mobile phones. Women cannot use phones or the Internet to overcome barriers if those barriers keep them from using phones or the Internet in the first place.

Technology may be only a tool, but it’s a powerful one. If businesses and governments in developing countries make smart investments in training and education, tackle underlying patterns of discrimination, and foster broad and inclusive discussions about how their work can benefit everyone, this tool may be our best chance yet to create a world that is both more prosperous and more equal.