As AI regulation and ethical frameworks take shape, developing nations must be involved.
The global artificial intelligence (AI) market is projected to reach $4.8 trillion by 2033; however, AI could impact 40% of jobs worldwide.
While the emerging technology is poised to bring many benefits, market dominance may widen technological divides, leaving many developing nations at risk of missing out on the benefits of AI.
This is one of the key findings of the Technology and Innovation Report 2025, compiled by the United Nations Conference on Trade and Development (UNCTAD), which sets out a catalogue of policies countries should consider adopting to align AI development with their socio-economic needs.
The report points out that while AI has a bright future, it risks creating new dividesas the benefits threaten to be unevenly distributed among regions across the globe.
While AI is transforming economies and creating opportunities, it could lead to greater inequality, it warns.
AI can be a powerful tool for progress but is not inherently inclusive. Countries should act now − by investing in digital infrastructure, building capabilities and strengthening AI governance – to harness AI’s potential for sustainable development, says UNCTAD.
It is becoming a prominent force in digital transformation. However, access to AI infrastructure and expertise remains concentrated in a few economies. Just 100 firms, mainly in the US and China, account for 40% of global corporate R&D spending, it adds.
The report points out: “AI could impact 40% of jobs worldwide, offering productivity gains but also raising concerns about automation and job displacement. The benefits of AI-driven automation often favour capital over labour, which could widen inequality and reduce the competitive advantage of low-cost labour in developing economies.
“However, AI is not just about replacing jobs − it can also create new industries and empower workers. Investing in reskilling, upskilling and workforce adaptation is essential to ensure AI enhances employment opportunities rather than eliminating them.”
Leading tech giants − such as Apple, Nvidia and Microsoft − each have a market value of around $3 trillion, rivalling the gross domestic product of the whole African continent.
According to the report, less than a third of developing countries have AI strategies. AI is shaping the world’s economic future, yet 118 countries – mostly in the Global South – are absent from major AI governance discussions.
“As AI regulation and ethical frameworks take shape, developing nations must have a seat at the table to ensure AI serves global progress, not just the interests of a few. Stronger international cooperation can create a global AI framework that prioritises equity, transparency and shared benefits.”
AI is redefining economic opportunities, placing technology, innovation and knowledge-intensive services at the heart of national development strategies, says the report.
It states that to set up effective AI policies, countries should consider three key leverage points: infrastructure, data and skills. Strategic positioning in these areas will determine whether nations can adopt AI effectively, foster local innovation and align AI development with their socio-economic needs.
UNCTAD’s report provides a roadmap for ensuring AI drives inclusive growth, rather than deepening divides. Key policy recommendations for the international community include:
Industry commitment: Similar to the environmental, social and governance framework, an AI equivalent public disclosure mechanism can improve accountability, translating global commitments into impactful outcomes.
Shared infrastructure: A global shared facility can provide equitable access to AI infrastructure.
Open innovation: Models such as open data and open source can democratise knowledge and resources, to foster inclusive AI innovation.
Capacity building: Initiatives to share AI knowledge and resources, especially South-South cooperation, can strengthen the capacity of developing countries to seize the benefits of AI and address common challenges.
