UNDP: AI may widen inequality

The United Nations Development Program (UNDP) calls on governments, partners and the private sector to strengthen connectivity, skills and safeguards, invest in sustainable compute, and build inclusive artificial intelligence (AI) strategies tailored to national capacity as the United Nations’s lead agency for international development released a new flagship report that warns of rising inequality between countries.

Regional and global cooperation on standards, safety and open models will be essential so that AI functions as a shared public good rather than a concentrated advantage, UNDP said following its release of the “Next Great Divergence” (NGD) on 18 March.

“AI has reached 1.2 billion users in only three years, with nearly 70 percent of them in developing countries, with 2 in 3 people in some high-income economies already using AI tools, while in many low-income countries usage remains close to 5 percent,” according to the report.

That unequal readiness and uneven adoption of AI could increase inequality between countries.

“AI can lift growth, expand opportunities, improve public services, and strengthen resilience. The same technologies, however, can accelerate exclusion, undermine governance, and raise human insecurity. Countries with strong connectivity, skills, compute, and regulation are poised to capture a larger share of the AI dividend. Others will face higher vulnerability to job disruption, data exclusion, misinformation, and the indirect effects of rising energy and water needs,” NGD adds.

People

AI can improve health diagnostics, personalize learning, strengthen food systems, and support financial inclusion. Bhutan is piloting AI tutors in schools, Mongolia’s AI-driven credit scoring has delivered more than 70 million dollars in micro-loans to nearly 4,000 businesses, and digital tools in Vietnam reach about 39 million farmers with real-time data and traceability. Flood-forecasting systems in northeast India have doubled prediction accuracy and extend warning times.

These gains emerge in a context where about 1.6 billion people in Asia-Pacific cannot afford a healthy diet and 27 million youth remain illiterate. Women in South Asia are up to 40 percent less likely than men to own a smartphone, and rural and minority groups often remain invisible in the data that train AI systems.

Economy

Once scaled, AI could lift annual gross domestic product (GDP) growth by around 2 percentage points and raise productivity by up to 5 percent in sectors such as finance and healthcare. ASEAN alone could gain close to 1 trillion dollars in additional GDP over the next decade. At the same time, labor markets face significant disruption, with 75 percent of surveyed firms expecting job losses alongside new roles. Female employment is nearly twice as exposed to AI as male employment, and informality remains high, including an estimated 88 percent of jobs in India and close to 60 percent in Indonesia.

Governance

AI can speed up service delivery, improve planning, and strengthen responses to climate and disaster risks. Bangkok’s Traffy Fondue platform has handled nearly 600,000 citizen reports, while Singapore’s Moments of Life has cut paperwork for new parents from about 120 minutes to 15 minutes. Digital twins in Beijing are used to model floods and urban growth in real time.

However, safeguards have not kept pace. Only a limited number of countries have comprehensive AI regulation, many systems operate as opaque black boxes, and by 2027 more than 40 percent of global AI-related data breaches may stem from misuse of generative AI.

Decisions taken in the coming years will influence whether AI narrows or widens development gaps for the next generation, UNDP says.