Poor countries will suffer even greater damage from robots

Poor countries will suffer even greater damage from robots

According to a report by the British "Financial Times" website, a study by Citi and the Martin College of Oxford University in the United Kingdom shows that countries such as Nepal, Cambodia, China, Bangladesh and Guatemala face the most serious risk of "premature deindustrialization." .

“There is a strong negative correlation between the level of income of the country and the degree of vulnerability to automation ,” said Carl Benedikt Frey, co-director of technology and employment programs at the Martin College of Oxford.

The report said that a week before the results of this study, the World Economic Forum (WEF) stated that the development of artificial intelligence, robotics, and other technological changes will result in the unemployment of more than 5 million people worldwide by 2020.

British media said that the analysis shows that the progress of automation and robotics will have the greatest damage effect on the world’s poorest countries, and 85% of Ethiopia’s jobs are at risk of being deprived.

The debate surrounding the impact of the so-called “fourth industrial revolution” has so far focused on the developed world. The 2013 analysis of the Oxford University’s Martin College concluded that over the next 20 years, 47% of jobs in the United States will be threatened by automation.

However, the follow-up analysis of the college seems to indicate that the developing world will suffer even greater impact. At present, in tradable sectors such as agriculture and manufacturing, low-income countries have a cost-competitive advantage over relatively high-wage countries.

The above research report argues that as robots replace workers, low-income countries will lose this advantage in more and more industries, and are comparable to high-wage countries in terms of costs. In addition, the current low wage level in poor countries means that they have more jobs that are easily automated and will eventually be replaced.

"Although much of the work in the developing world can be automated, automation is not yet worthwhile because of the availability of cheap labor," the report said.

The report stated that, in addition, the report entitled "Technology At Work v2.0" asserts that the rise of automation and the development of technologies such as 3D printing will encourage enterprises to relocate their manufacturing operations to their home countries.

The report claims to have seen initial signs of this trend, the slowdown in the fragmentation of the global supply chain, and even a reversal in some countries. According to the report, in 2011, the Philippines, China, and Malaysia purchased more imported products in the domestic market than in 2005 in order to export finished products.

Despite this, the author of the report asserts that North America will be a big winner in this relocation trend. As a major beneficiary of the offshore wave of outsourcing before, emerging markets will become obvious losers.

This, together with the increasing efficiency of the manufacturing industry and the consequent decrease in labor intensity, all cause concern that many developing countries will experience "premature deindustrialization."

It is even worse that even though developing countries may feel the full impact of automation later than rich countries, "but in countries where consumer demand is very low and social security networks are not sound, this impact may be even greater. Destructive effect."

In emerging countries where there are still large numbers of small-scale farmers, the transition from labor-intensive production to capital-intensive production can create problems, especially because agriculture itself tends to increase automation.

“Transferring workers from agriculture to manufacturing alone is not necessarily the road to prosperity. In China, the payback period for using a robot has been reduced to two years. I think this is a rather surprising discovery.” Ray said.

Poor countries will suffer even greater damage from robots