Artificial Intelligence (AI) is poised to drive global market growth, with projections estimating a $4.8 trillion market value by 2033—equivalent to the size of Germany’s economy. Yet, according to a report from the UN Trade and Development agency (UNCTAD), while AI promises significant productivity and digital transformation gains, it also raises concerns over job displacement and increasing inequality, both within and between nations.
AI’s Dual-Edged Impact On Employment
UNCTAD’s report highlights that 40% of global jobs could be affected by AI and automation, with the potential to displace workers across various sectors. Despite the technology’s potential for productivity boosts, the benefits are heavily concentrated, favouring capital over labour. As a result, automation risks widening income inequality and diminishing the competitive advantage that low-cost labour offers in developing economies.
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“The benefits of AI-driven automation often favour capital over labour,” the report states, warning that this could further exacerbate inequalities in global job markets.
A Growing Divide Between Nations
The report underscores that the economic advantages of AI are not only concentrated within companies but also within specific nations. Currently, 40% of global corporate R&D spending on AI is controlled by just 100 firms, primarily located in the U.S. and China. The dominance of leading tech companies like Apple, Nvidia, and Microsoft—whose market valuations rival the entire GDP of Africa—poses a risk to developing nations, leaving them vulnerable to lagging behind in the global AI race.
Adding to the concern, UNCTAD notes that 118 countries, mostly in the Global South, are not part of key AI governance discussions. This lack of participation could lead to further technological divides, preventing many nations from reaping the full benefits of AI.
AI As A Catalyst For Innovation Or Inequality?
The report does acknowledge that AI holds the potential to create new industries and empower workers—if countries invest in reskilling and upskilling their populations. However, for developing nations to avoid being left behind, they must have a seat at the table when it comes to shaping AI regulation and ethical frameworks.
UNCTAD’s Recommendations For Inclusive Growth
To ensure that AI contributes to inclusive global growth, UNCTAD has laid out several recommendations. These include implementing an AI public disclosure mechanism, establishing shared AI infrastructure, promoting open-source AI models, and creating initiatives to distribute AI knowledge and resources more equitably.
The report concludes with a call to action: “AI can be a catalyst for progress, innovation, and shared prosperity—if countries actively shape its trajectory. Strategic investments, inclusive governance, and international cooperation are key to ensuring that AI benefits all, rather than reinforcing existing divides.”
In short, while AI holds immense potential, its benefits will only be widespread if the global community works together to address the risks of inequality and exclusion.
