The Global Risks Report 2024

concentrated in technologically advanced regions, building on existing divides in educational and digital literacy that cannot be bridged without investment (Chapter 2.4: AI in charge). The lower cost of labour may still incentivize offshoring to a degree; however, protectionism in digital services could strengthen. For example, stronger data localization requirements would effectively “reshore” these industries. 96 As such, a more fundamental question is rapidly emerging: can manufacturing- and services-led export growth remain an accessible pathway to greater prosperity for developing countries? In most advanced economies, the creation of “boots-on-the-ground” green infrastructure jobs could exacerbate already tight labour markets. 97 This could be a severe constraint to the green transition for the largest emitters in the medium term and, given geopolitical dynamics and societal discontent, is more likely to incentivize the replacement of lower-skilled, routine jobs (muscle to machine power) than encourage immigration and improved labour mobility. Indeed, grappling with shrinking and ageing workforces, companies in advanced economies will seek to capitalize on the productivity benefits offered by AI, deploying them rapidly and at scale. Generative AI will increasingly be substituted for middle-skilled workers (biological to machine intelligence), particularly in the services sector. The rapid deployment of these technologies could crowd out human competencies within a relatively short period of time – leading to shifts from talent shortages to underemployment and unemployment in some parts of these economies and creating knock-on effects in developing economies. Index (2005=100)200300400500 100 2022 2005 2010 2015 2020 0 20 40 60Service exports, selected economies and economy groups FIGURE 2.22 A. Growth in exports of commercial services, by groups of economies, 2005-2022 Other developing economiesLeast-developedeconomies Rest of the world B. Share of telecommunication, computer and information services, other business services, and finance, 2019 and 2022 2019, Top 10 WTO members Israel 32.8% 29.6% 27.4% 26.4% 26.2% 25.7% 25.1% 25.1% 22.9% 16.6%United Kingdom IndiaSeychelles Nepal Ghana Philippines DominicaCosta Rica Singapore Percentage0 20 40 60 Percentage Source WTO, 2023.2022, Top 10 WTO members Dominica Samoa United KindgomIsrael Philippines India Tonga GhanaAfghanistan Costa Rica47.9% 35.3% 29.7% 29.3% 28.6% 28.4% 26.9% 25.7% 25.3%58.6% Global Risks Report 2024 63