C. Fostering a sustainable digital transformation in the production sector

• Developing an ecosystem that favours entrepreneurship and innovation. Technology-based companies form the cornerstone of digital transformation processes, so it is vital to foster their creation through initiatives such as business incubators, start-up accelerators, mentoring and support systems and angel investor networks. Public-private coordination and its link with educational and technical centres are key to creating complementarities and synergies that enhance development of new ventures and technology-based companies.

• Promoting digitalization of companies, with a focus on MSMEs In this area, it is essential to raise awareness of the potential of digital solutions with regard to business management and performance. Similarly, capacities must be built and financing mechanisms must be provided for access to technology and different digital solutions.

• Promoting incorporation of advanced technologies into the productive sector. It is crucial for advanced technologies —such as the Internet of things (IoT), cloud computing, AI and autonomous robotics— to be adopted throughout the value chain (procurement, design and development, manufacturing, operations, distribution, marketing and after-sales service) in order to improve the productivity and competitiveness of traditional sectors, as well as to foster development of new technology- and knowledge-intensive sectors. Such actions should be aligned with efforts to diversify the production structure and the development of business clusters and networks.

• Promoting the green transition by digitalizing the productive sector. A transformation of business and production models must be fostered, with sustainability as a central driving force of productivity and competitiveness. Public-private coordination will be key to making progress in this regard and taking advantage of the new opportunities presented by the green transition. To move beyond certain ingrained business practices, incentives must be established to encourage adoption of technologies that support the green transition and reduce carbon emissions and effects on climate change.

• Promoting e-commerce policies. This entails better coordinating policies to foster e-commerce, strengthening public-private links and aligning policies with national digital agendas. A global approach to e-commerce is also required, to take advantage of opportunities to increase participation in international markets, even in non-traditional sectors. At the national level, efforts should be made to more rapidly implement policies to enhance the enabling environment for e-commerce, relating to digital connection quality, trade facilitation, reliable logistics services, financial inclusion and modernization of the regulatory framework for electronic payments.

D. Establishing appropriate governance for the digital age

• Strengthening synergies between digital policies and national development strategies Digital technologies can transform the development model as they enable innovative policy responses. National development strategies must factor in application of these technologies as tools in their various areas of development, which entails raising awareness among decision makers in the various sectors about the potential and challenges of digital transformation, as well as the creation of spaces for coordination at the highest level.

• Formulating comprehensive digital agendas that are coordinated with sectoral strategies. Because digital technologies are multipurpose, digital agendas must be designed with a cross-cutting approach to sustainable development, simultaneously interlinking them with actions in key areas such as education, health, government services, commerce and industry. Given the disruptive nature of advanced technologies such as AI, blockchain and IoT, digital agendas must also include actions to facilitate their deployment and adoption.

• Strengthening the institutional frameworks for digital agendas. To achieve this, the agencies and bodies that design and implement digital agendas must be given greater seniority, which will enable establishment of multisectoral coordination mechanisms at the State level, as well as spaces for public-private collaboration. Similarly, adequate financial resources must be allocated for implementation of digital agendas and to establish assessment mechanisms that include improvements to instruments for measuring digital development.

• Modernizing regulation related to digital infrastructure. This entails adapting the frameworks of rules and regulations for telecommunications in areas such as licensing, coverage obligations and spectrum allocation, as well as facilitating alternative financing mechanisms to increase coverage and broadband service provision,3 and providing investment incentives. Countries in the region should advance on two fronts concurrently: increasing coverage of broadband services in their territories and accelerating deployment of 5G and fibre-optic networks. Increased adoption of 5G networks and multicloud approaches in the context of Industry 4.0 will require more storage capacity and faster download speeds, and in turn installation of more advanced data centres.

• Adapting competition regulations, to promote fair and competitive markets in the digital age Competition regulations must be adapted to the new trends in business models enabled by digital technologies, which entails fully understanding the behaviour of economic agents and the determinants of market power, including ownership and use of digital data.4 Tax systems must also be adapted to the new business practices enabled by digital technologies. Therefore, capacities must be built to regulate competition and establish tax systems that are suited to the challenges of the digital age.

• Strengthening cybersecurity and data protection. National cybersecurity strategies are needed, to help public and private actors address cyberattacks in a coordinated manner, as well as regulatory frameworks concerning data privacy, to improve the security of digital solutions and increase trust in their use. This entails creating appropriate institutional frameworks for their implementation. Cybersecurity regulations should also aim to protect critical infrastructure, to prevent cyberthreats from endangering public services (including water, electricity, telecommunications, transport, the logistics chain and port systems).

• Adapting labour frameworks to promote new forms of employment and telework. The pandemic has led to forms of telework that, far from being temporary, are becoming more commonplace. Labour legislation must be adapted to the new business models and forms of hiring enabled by digitalization, but without neglecting labour rights and keeping in mind the risks of employment becoming more precarious.

E. Strengthening regional digital cooperation and integration

• Pursuing a regional digital market. Measures in this area would enable establishment of a collective strategy to increase trade, expand the digital economy and increase competition through regulatory consistency, integration of infrastructure and development of digital platforms, cross-border data flows and measures to facilitate trade. In this respect, steps could be taken with regard to regulatory convergence and cooperation through trade organizations and agreements, such as the Pacific Alliance, the Central American Common Market, the Caribbean Community (CARICOM) or the Southern Common Market (MERCOSUR).

3 Consideration could be given to reforming funds for universal service and implementing a regulatory “sandbox” that enables operators to directly manage some of their contributions to funds to cover the costs of providing services to lower-income households. Authorization for self-management of resources may be subject to the fulfilment of conditions set by regulators to promote competition between service providers, which will lead to improved conditions being offered so that this authorization can be obtained.

4 Namely, ensuring that data are not used or stored in an anti-competitive manner, in order to enable equitable access for all parties; facilitating access to data (for example, in a market that can only be accessed by paying a fee) and ensuring an adequate level of protection for information in order to improve the competitive position of MSMEs in the digital economy.

• Promoting greater regional cooperation and coordination for policy design. In this regard, it is necessary to strengthen spaces for dialogue and regional efforts, such as the Ministerial Conference on the Information Society in Latin America and the Caribbean, a space to define shared principles and priorities that brings together the 33 countries of the region and representatives from the private sector, civil society and the technical community. The Digital Agenda for Latin America and the Caribbean has emerged as a key instrument for capacity-building and policymaking, as well as for facilitating better linkages and coordination with the actions carried out by the various cooperation agencies and forums. Dialogue within the framework of the Digital Agenda could facilitate identification of shared projects and challenges in areas such as cross-border trade, cybersecurity and payment systems.