The impact of digitalisation and the opportunities to improve services in Latin America

Latin America can have great opportunities for development and evolution as indicated in the presentation of the report on infrastructure with a focus on the impact of digitisation and opportunities for improving services in Latin America held through an online event offered by the Development Bank of Latin America (CAF). The conference focused on the importance of digitising infrastructure to improve the services provided to citizens. 

The event was attended by high-ranking officials from the region, such as Gloria Hutt Hesse, Minister of Transport and Telecommunications of Chile; Félix Sosa, President of the National Electricity Administration of Paraguay; Lina Marcela Quiñones, Director of Mobility Intelligence of the Secretariat of Mobility of Bogotá; and CAF authorities such as Pablo Sanguinetti, Vice President of Knowledge of CAF; and Antonio Silveira, Vice President of Infrastructure of the Development Bank of Latin America.

Also present were experts such as Walter Cont, chief executive and editor of Ideal 2021; Ernesto Schargrodsky, director of Socio-Economic Research; Fernando Navajas, chief economist at the Fundación de Investigaciones Económicas Latinoamericanas (FIEL) in Argentina; and Germán Lleras, regional director of Steer Group in Colombia. 

First, Walter Cont presented the main points of the report: the impact of digitalisation to reduce gaps and improve infrastructure services; also known as Ideal 2020-2021. Subsequently, Fernando Navajas and German Lleras commented on it.

Fernando Navajas said that when you look at the shock that has been the pandemic in the market, in regions such as Latin America and Europe, the differences are explained by digitalisation and its implementation in the sectors of the economy and that COVID-19 is an extreme incident, which tests the system. Digitalisation makes the system resilient. Also, regarding the effects of digitalisation, he considered that the distributional feature of digitalisation is more "pro-poor" than the report suggests. Digitalisation, as an element of resilience, protects the entire population against such extreme events. 

German Lleras added with regard to the transport sector that it is very difficult to compare the level of transport in cities as there are variables, such as the geography of the city, that play a key role in the development of the transport sector. He supported that the pandemic accelerated digitalisation and agreed with Fernando Navajas that this is an element of protection against catastrophes. However, this effect has not been seen in public transport, which is why he believes that the public transport network should invest heavily in digitalisation.

This was followed by a panel discussion on public policy, comprising Gloria Hutt Hesse, Lina Marcela Quiñones and Félix Sosa. In the dialogue, several questions were posed by the moderator of this block, Antonio Silveira, to which the participants gave revealing explanations. 

To what extent can digitalisation be an ally in the sectoral challenges that must be managed in the political sphere of transport and communications in Chile?

Gloria Hutt Hesse emphasised the efforts for the generalisation of fibre optics in Chile. On the other hand, specifically in the field of transport, digitalisation is useful to magnify the possibility of capturing and receiving information, thus focusing digitalisation on better service planning and improving the quality of the experience for users (e.g. wifi network inside the bus).

In a city with such "friendly" traffic as Bogotá, how does digitalisation help to address these challenges?

Lina Marcela Quiñones explained that digitalisation helps to collect real-time information about what is happening on the streets. Currently there is a project to improve the traffic management centre with cameras and sensors throughout the city to turn it into an intelligent transport system that will allow it to collect and take action much more quickly. In this way users can make better decisions that best suit their route.

How does digitalisation support the challenges of promoting smart grids in Paraguay?

Félix Sosa replied that a digital integrated contingency control system allows customers to be more active and communicate their criticisms to the services, so that investments can be optimised and better targeted, thus improving service. Also, digitalisation allows management to be more transparent, as the customer has more information about the process.

What were the challenges specifically in the context of the pandemic?

Gloria Hutt replied that the shock of the pandemic was felt in several sectors. The first challenge was for companies to reconfigure their capacities, as people started working from home. It was difficult to stabilise their services so that workers could provide them from home. Secondly, public policy needed specific plans for lower-income sections of the population to adapt to the new situation as well. A plan for free connections to the coronavirus website, company platforms, education platforms... so that people without a wifi connection would not be disconnected.  Finally, adapting city transport for deconfinement, where digitalisation helped to follow the movements of the population anonymously, in order to monitor compliance with the quarantine. 

Lina Quiñones added that in Colombia, many procedures that were previously carried out in person were digitised. In public transport they started with 35% capacity, but the challenge now is to get the public to trust public transport again, as many users still have an aversion to using public transport. In the wake of the pandemic, there has been an increase in ridesharing and cycling, so not all former public transport users have turned to private means of transport. 

Felix Sosa said that there were positive and negative experiences in the management. The experience was very positive in speeding up the implementation of teleworking and remote contact with customers, as well as the operation of the distribution system. It was negative in terms of billing, which had to be corrected afterwards. Electricity consumption increased a lot in residences and decreased in companies. He added that the installation of smart meters could help to optimise this process. 

Regarding the security of the Paraguayan electricity grid, they have signed a cooperation agreement with the CAF for cybersecurity. Sosa stressed that it is essential that IT security is defined to protect the institution's assets and customers.

What are the programmes to leverage digital transformation in Chile?

Hutt Hesse highlighted that CAF has been a protagonist in this, as it has helped to deploy connections between Latin America and Asia. One of the programmes is public fibre optic coverage throughout the country, which makes it possible to reach the most isolated areas of the country where private companies do not reach because they are less profitable than large population centres. Right now they have 60% coverage. He wanted to highlight the importance of anticipating the digital divide in order to avoid it, as the digital divide is notorious in Latin America.

What are the stakes in Bogotá?

Quiñones answered that the big bet is the intelligent transport system that helps to predict in the short term what is going to happen, how to manage traffic and collect better information. They are also working with predictive traffic models, as well as trying to implement distance-based charging for public transport. This information should be able to be integrated into a single database, to be more efficient. He proposed the establishment of an equitable and inclusive fare scheme, which guarantees access to the city for the entire population, and the Mobility Observatory, which would be a tool for communication with citizens, where information could be found in a clear and simple way.