How SEZs can help drive AI industrialisation
23 September 2020 | Web Article Number: ME202020648
THE artificial intelligence (AI) revolution, together with its brethren in the Fourth Industrial Revolution, is a long-term process. It will take between 20 and 50 years to reach the heights of its most ardent proponents. That is, it will give the world, for the first time, a social system where the underclass does not exist for humanity. Instead computers and intelligent devices play the role of the underclass.
An understandable analogue is captured succinctly by Yuval Noah Harari, when referring to human beings as the overlords and the rest of the animal world as the underclass.
Consequently, in its final form, AI is a megatrend that will take decades to unfold, and it has to be seen and managed as such. AI is by nature mutable and mercurial, it is difficult to pin down. Thus, the focus will be on two aspects as a discussion point: (a) Machine Learning (including Deep Learning) and (b) Blockchain Technologies.
Firstly, the “Machine” in Machine Learning is not a creaking robot with servos and steel, but mere Software. Software that may one day become your colleague, or takeover tedious tasks that you would rather not do. Machine Learning is becoming an accessible “commodity” that is attained through the utilisation of computing algorithms that are done, using Data Science.
A question that often comes to mind: “What can government do to manage this megatrend?” There are two major levers that government can use:
The first is that the business of government in South Africa is mostly governed by the Public Finance Management Act (PFMA). Thus, the processes in government are fixed and may tend to have their own inaction, which may be malign and lead to misuse, abuse and malfeasance as government is the custodianship of public funds. Machine learning can be brought in to bear in terms of Robotic Process Automation (RPA) and specifically the RPA for government and public sector referred to as RegTech. The RPA will be combined with another AI technology, which is, Natural Language Processing (NLP). This will be in the form of chatbots that will be utilised mainly for service delivery. This in itself can release billions of rands that are at the moment either misdirected or misappropriated, to drive economic growth and social cohesion.
The second aspect in which the South African government can leverage AI is through policy. Many governments around the world with nation states such as Germany and China as well as many States in the US have innovative policies to promote firstly the industry of AI, which itself is already worth 100’s of billions of US Dollars; and secondly to ensure that AI propels industrialisation, with Special Economic Zones (SEZ) being one of the drivers in this process.
South Africa would do well by being like the intelligent thieving magpie and copy from the above-mentioned nations’ policies. It could also pivot its re-industrialisation strategy by utilising AI as an instrument.
The traditional economy in SA is growing slowly, and therefore the development of new emerging industries could gain momentum with increased contributions to the economic growth of the country. Emerging industries include information technology; electronics and communication equipment manufacturing; cloud computing; big data, virtual reality; aerospace manufacturing; artificial intelligence; 3D technology; medical services; robotics; to mention but a few. Utilisation of the SEZ’s can focus governments’ effort, and as it were, use SEZ’s as the thin end of the wedge to be an accelerator of re-industrialisation through new technologies.
SEZ’s should not only foster new driving forces, but also transform and upgrade old driving forces in order to achieve coordinated development of both old and new driving. Industrial innovation therefore remains an urgent matter.
The Internet of Things (IoT) will be able to greatly reduce intermediation, monopolisation, and information asymmetry as well as company costs. It will leave the following service space to SEZ’s:
- It will increase the need for the development of smarter cities around the SEZ. The corresponding intelligent services will be provided in the process of making public services – including urban medical treatment, health and environmental protection – more intelligent.
- It will generate more need for intelligent production. The traditional enterprises in the SEZ’s will be upgraded and transformed into factories manufacturing or utilising AI.
SEZ’s would need to adjust and be more closely integrated into the division of labour in the global industrial chain so as to build more extensive and deeper economic trade contacts with internal value chains and extend abroad.
By Monde Mawasha, Programme Director: ICT, Research & Strategy at the Coega Develeopment Corporation.