UNDP Warns AI Could Deepen Global Inequality Without Strong, Inclusive Policies

UNDP says that without strong, coordinated, and inclusive policy responses, AI risks reversing decades of global progress that has helped narrow development gaps.

A major new report from the United Nations Development Programme (UNDP) warns that artificial intelligence (AI), if left unmanaged, could accelerate inequality between countries, widening divides in wealth, skills, and governance. Titled “The Next Great Divergence: Why AI May Widen Inequality Between Countries,” the report stresses that while AI offers transformative development opportunities, nations are beginning the AI era from vastly different starting points.

UNDP says that without strong, coordinated, and inclusive policy responses, AI risks reversing decades of global progress that has helped narrow development gaps. What the world faces now, the report argues, is the possibility of a new “great divergence” between countries capable of harnessing AI and those left behind by the accelerating pace of technological change.

Asia-Pacific at the Heart of the Global AI Transition

The Asia-Pacific region, home to more than half of the world’s population, is emerging as a global epicentre of AI growth. The region now accounts for:

• Over 50% of global AI users

• Nearly 70% of worldwide AI patents, driven largely by China

• More than 3,100 newly funded AI companies across six leading economies

Economic modelling in the report suggests AI could boost annual GDP growth in the region by 2 percentage points, and improve productivity in sectors such as healthcare and finance by up to 5%. ASEAN economies alone could generate nearly USD 1 trillion in additional GDP over the next decade.

Despite these opportunities, the report highlights major vulnerabilities. Millions of jobs—especially those held by women and young people—face significant automation risk if inclusive and ethical AI governance is not prioritised.

“AI Is Racing Ahead, and Many Countries Are Still at the Starting Line”

Kanni Wignaraja, UN Assistant Secretary-General and UNDP Regional Director, warns that rapid technological acceleration is creating new divides:

“The Asia and Pacific experience highlights how quickly gaps can emerge between those shaping AI and those being shaped by it.”

For much of the past 50 years, lower-income countries have steadily closed gaps in health, education, and income through improved technologies and development investments. AI, however, threatens to disrupt this long-standing “era of convergence.”

Uneven Digital Readiness Is Driving New Inequalities

The report reveals deep disparities in digital capability across countries:

• Advanced AI nations such as Singapore, China, and South Korea are investing heavily in AI infrastructure, computing power, and talent.

• Lower-income countries continue to struggle with basic digital access, connectivity, and literacy.

This uneven readiness amplifies risks:

• Limited computing power restricts AI innovation.

• Weak governance creates vulnerabilities to cybercrime and misuse.

• Lack of data diversity increases algorithmic bias, particularly for rural, indigenous, and marginalised communities.

• AI’s high energy and water demands raise concerns in climate-sensitive regions.

Women face disproportionate challenges. In South Asia, they are 40% less likely than men to own a smartphone, and jobs traditionally held by women are almost twice as exposed to automation. Youth employment in high-AI-exposure roles is already declining, especially among those aged 22–25.

AI’s Promise for Public Services and Governance

Despite the risks, the report highlights successful AI applications transforming governance:

• Bangkok’s Traffy Fondue system has processed nearly 600,000 citizen reports.

• Singapore’s Moments of Life service cut administrative time for new parents from 120 minutes to 15 minutes.

• Beijing’s digital twins are improving urban planning and real-time flood management.

These examples show how AI can strengthen public services, boost efficiency, and enhance government responsiveness—if deployed responsibly.

A Critical Need for Strong AI Governance

Only a small number of countries currently have comprehensive AI regulation. UNDP warns that by 2027, over 40% of global AI-related data breaches may result from misuse of generative AI systems.

Philip Schellekens, UNDP Chief Economist for Asia and the Pacific, says capability will define the next era of development:

“Countries that invest in skills, computing power and sound governance systems will benefit; others risk being left far behind.”

The report concludes that global inequality is not inevitable in the AI age—provided countries adopt inclusive, responsible AI policies that ensure the benefits of technological change reach all people.