The digital economy contributes a significant share of output globally. The sector accounts for about 5–15% of GDP in many economies either directly or indirectly. By 2030, the Digital Cooperation Organization (DCO) predicts that, the digital economy could contribute 30% of global GDP.
In Uganda mobile money, digital platforms, and ICT services have become critical contributors to both formal and informal economic activity, leading to expanded market access, financial inclusion, trade, and service delivery. Recent industry assessments in Uganda, indicate that the digital sector is an integral part of the economy, accounts for about 9 per cent of national gross domestic product (GDP), with the sector expanding at an annual rate of nearly 15 per cent and employing over 2.3 million people. This reflects the increasing importance of the digital economy functions such as mobile connectivity, online services, and digital platforms play in trade, finance, and public services.
Powered by big data, digital infrastructure, artificial intelligence (AI), and data science is reshaping growth pathways, labour market outcomes, and service delivery globally. Yet in many low and middle-income countries, gaps in digital infrastructure, connectivity, skills, digital tax governance and regulatory frameworks limit the ability to harness these technologies for inclusive and sustainable development. Critical evidence gaps remain on how digital tools can boost productivity, entrepreneurship, and job creation while ensuring data security and equity. CEPDIME’s Digital Economy, AI, and Data Science theme collaborates with researchers, policymakers, and private sector actors to generate actionable evidence that informs digital policy, infrastructure investment, AI deployment, and innovation strategies to accelerate inclusive, competitive, and resilient economic growth. The theme aims to strengthen our understanding of digital public infrastructure, data governance, cybersecurity, and digital finance, while exploring how AI can improve market efficiency, competitiveness, and the delivery of sustainable development outcomes.
The core core questions around this thematic synthesis are:
a) How can digital technologies drive productivity, inclusion, and job creation in developing countries?
Despite the rapid adoption of AI, mobile technologies, internet penetration and digital platforms, many firms and workers in developing countries remain unable to fully harness these tools due to limited connectivity, inadequate digital infrastructure, and gaps in digital skills and supportive policy frameworks. Key research issues around this theme include:
- Mechanisms for using AI and data science to increase firm productivity and market efficiency.
- How can digital adoption accelerate productivity in traditional sectors such as agriculture, manufacturing, and services?
- What policies and incentives enhance the uptake of digital tools among firms and workers in low-resource settings?
- How can digital technologies support entrepreneurship, innovation, and the formalization of informal economic activity?
- Policies to expand digital skills, access, and adoption across sectors and populations.
- Integrating digital infrastructure with industrial, agricultural, and service sector development.
- Understanding the barriers that prevent small and medium enterprises from fully participating in the digital economy.
b) What governance and institutional challenges shape digital adoption and outcomes?
Weak or fragmented digital governance, limited data protection frameworks, and regulatory gaps constrain the impact of digital technologies. Core dimensions include:
- Coordination among national, local, and sectoral digital authorities.
- Legal, regulatory, and institutional frameworks for data privacy, cybersecurity, and digital markets.
- Incentive structures and accountability mechanisms shaping public and private sector adoption of digital tools.
- How political economy dynamics influence digital reform and investment decisions.
c) How can AI, data science, and digital infrastructure support inclusive and sustainable development?
Digital technologies offer potential to improve service delivery, market efficiency, and innovation, but their impact depends on deliberate policy design. Evidence is needed to determine:
- Which digital interventions generate the largest social and economic returns.
- How AI can complement human labour without exacerbating inequality.
- The role of digital public infrastructure in expanding access to service delivery and markets.
- Innovative financing and partnerships to scale digital solutions sustainably.
CEPDIME aims to bridge research and policy by producing high-quality, actionable evidence on digital transformation, AI deployment, and data governance. By embedding research in policymaking processes, the program supports governments in designing interventions that maximize productivity, inclusion, and resilience in the digital economy, while fostering competitive and sustainable growth.