Geneva: The significant uptick in consumer e-commerce activity fuelled by the COVID-19 pandemic was sustained in 2021, with online sales increasing markedly in value, despite the easing of restrictions in many countries.
According to new UNCTAD figures, the average share of internet users who made purchases online increased from 53% before the pandemic (2019) to 60% following the onset of the pandemic (2020/21), across 66 countries with statistics available.
The greatest rise in e-commerce occurred in several developing countries. In the United Arab Emirates, the share of internet users who shopped online more than doubled, from 27% in 2019 to 63% in 2020. In Bahrain the share tripled, reaching 45% in 2020, and in Uzbekistan, it rose from 4% in 2018 to 11% in 2020.
In Thailand, which already had a relatively high uptake prior to the pandemic, a 16-percentage-point increase meant that for the first time more than half of internet users (56%) shopped online in 2020.
Among developed countries, the greatest increases in e-Commerce activities were seen in Greece (up 18 percentage points), Ireland, Hungary and Romania (each 15 percentage points).
Of the 66 countries covered, online shopping remains the lowest in El Salvador (1% of internet users), Azerbaijan (5%), Uzbekistan (11%) and Colombia (17%).
But the situation prior to the pandemic and the extent of the boost to online shopping experienced vary between countries. Many developed countries already had relatively high levels of online shopping (above 50% of internet users) before the pandemic while most developing countries had a lower uptake of consumer e-commerce.
The study emphasises that better digital governance is needed to balance data opportunities and risks. As the global economy becomes increasingly digital, better rules are needed to protect people and the planet and ensure everyone can reap the world of online opportunities.
The study shows that the COVID-19 pandemic made digital technologies and an internet connection even more important in our daily lives, as people and companies have moved even more online to work, learn, socialize, shop and do business.
Official statistics, available for seven countries that together comprise around half of global GDP (including the United States and China), indicate that online retail sales increased substantially in these countries from around $2 trillion in 2019, immediately prior to the pandemic, to around $2.5 trillion in 2020 (not shown) and $2.9 trillion in 2021. China accounts for over half of the online retail sales across these countries and the United States for a further 30%.
But not everyone is reaping the benefits, especially the 2.9 billion people still without an internet connection. A heavier reliance on digital tools also poses risks to the environment, as they generate more CO2 emissions and e-waste.
Keeping this in view, UNCTAD said bridging the digital divide and tackling the risks of digitalization were at the heart of its eCommerce Week, happening from April 25 to 29, 2022.
Ahead of the event, Torbjörn Fredriksson, head of UNCTAD’s e-commerce and digital economy branch, and Andy Yen, founder and CEO of Proton Technologies, discussed what’s needed to strike a balance between the opportunities and risks of digitalization and a data-driven world.
Fredriksson said digitalization right now was one of the biggest developmental challenges confronting the world. The digital transformation that was accentuated during the pandemic pointed to the unequal opportunities that existed between the ones that could and the ones that could not take advantage of digital solutions to cope with the negative effects of the pandemic – be it in the health care area or in the economic field.
“This has immediately raised the awareness among the governments around the world that something needs to be changed. We cannot continue on the same trajectory because that will just result in even wider divides, even wider inequalities. But unfortunately, it’s going to be very difficult for individual governments to deal with all these issues on their own. We need to come together,” he said adding that this is the time when the UN should do its job by bringing all the forces together to develop something that’s not good only for individual countries but for the planet as a whole.
On the question of how to make digital work for all countries, Andy Yen said the problem could be tackled from a regulations standpoint. “The environment that exists today with five dominant tech companies that essentially rule the world is because we have for the past two decades really had an internet ecosystem that had very little to no regulation, both at the national level and also at the global level,” he said. He added, “So having an approach that spans multiple countries, big and small, that really adapts to the reality of the economy today and allows us to put in commonsense regulations that lead to better competition and a more fair ecosystem for all businesses to have the equal opportunity to succeed is going to be key to removing some of the inequalities that have developed over the past 20 years.”
– global bihari bureau
