According to a market study by UN Trade and Development (Unctad), last year the German economy fell one place in the high-tech countries table. In the Readiness Index for Frontier Technologies, it now ranks eighth behind Switzerland and South Korea. The USA, Sweden, and Great Britain remain at the top.

The index combines indicators for the use of information and communication technologies (ICT), skills, R&D activities, industrial capacity, and access to finance, to provide a comprehensive measure of a country's readiness for cutting-edge technologies.

According to Unctad, industrialised countries have recently further consolidated their position because new technologies such as artificial intelligence (AI), robotics, and quantum computing require high levels of investment and a solid, dense infrastructure. However, China and India are increasingly moving into the top group. According to the study, Germany's shortcomings are primarily in the areas of digital infrastructure and financing for high-tech.

However, Germany can still keep pace when it comes to cloud infrastructures. These are crucial to the success of AI because they are where the digital model entities are „trained“, and provide the services for AI users. With 190 cloud infrastructure providers, China is undisputedly in first place, ahead of the USA, Australia, and India. Germany follows in fifth place, ahead of Japan, Canada, and the UK.

However, some countries are catching up significantly even beyond their „income position,“ writes Unctad. Besides China, Brazil, India, and the Philippines are mentioned. Large countries may have a low proportion of developers, but they nevertheless have a significant number, allowing them to build on their AI advantages. The United States has the most specialists overall, followed by India and China. And China, according to Unctad, has another advantage: Its digital infrastructure is growing rapidly, coupled with its affordability and sheer volume of data.

The high investment requirements for AI, and the concentration of the technology in a few companies and country groups, are nevertheless a major problem, according to Unctad Secretary-General Rebeca Grynspan. By 2033, AI is expected to reach a market value of up to 4.8 trillion dollars. But just 100 companies, mainly in the United States and China, are responsible for 40% of global R&D expenditure by AI companies. Leading technology giants such as Apple, Nvidia, and Microsoft each have a market value of around $3 trillion, equivalent to the gross domestic product (GDP) of the entire African continent.

„Market dominance at the national and corporate levels can widen the technological gap and put many developing countries at risk of missing out on the benefits of AI," Grynspan commented.

Unctad estimates that AI will impact up to 40% of global jobs, and enable enormous productivity gains. Some jobs could even be relocated back to industrialised countries due to AI automation, says the Unctad head, if the competitive advantage of low-wage labour is eliminated. Therefore, developing countries themselves – but also industrialised countries – must ensure that investments are made in retraining, further education, and the adaptation of the workforce.

This is also in the interest of industrialised countries and large tech companies, she argues, simply for reasons of purchasing power in future sales markets. Therefore, it must be ensured that „AI promotes inclusive growth rather than widening the divide.“