The global artificial intelligence (AI) market is set to reach $4.8 trillion by 2033, approximately the size of Germany’s economy, according to a United Nations report released on Thursday. However, while AI presents vast economic opportunities, it also poses risks of deepening inequalities and widespread job displacement.
The United Nations Conference on Trade and Development (UNCTAD) warned in its report that AI could affect 40% of jobs worldwide. Unlike previous technological advancements that primarily disrupted blue-collar work, AI is expected to have the greatest impact on knowledge-based industries, placing advanced economies at higher risk. Despite this, these nations are better positioned to harness AI’s benefits compared to developing economies.
“The benefits of AI-driven automation often favour capital over labour, which could widen inequality and reduce the competitive advantage of low-cost labour in developing economies,” UNCTAD stated.
Growing Economic Impact
AI is expected to become the dominant force in the technology sector within the next decade. According to UNCTAD, the global market for emerging technologies such as AI, blockchain, 5G, and 3D printing was valued at $2.5 trillion in 2023. That figure is projected to grow sixfold, reaching $16.4 trillion by 2033, with AI alone accounting for nearly $5 trillion.
However, AI expertise and infrastructure remain concentrated in a handful of economies, with just 100 firms—mostly based in the United States and China—responsible for 40% of global corporate research and development spending.
Call for Inclusive AI Governance
UNCTAD stressed the need for global cooperation to ensure AI benefits all nations, not just a select few. In a statement, the agency’s secretary-general, Rebeca Grynspan, urged world leaders to shift the focus from technological advancement to human well-being.
“History has shown that while technological progress drives economic growth, it does not on its own ensure equitable income distribution or promote inclusive human development,” Grynspan said.
The report also highlighted that 118 countries, primarily from the Global South, are absent from major discussions on AI governance. This raises concerns that AI regulations and ethical frameworks may be shaped by a small group of powerful nations, potentially sidelining the needs of developing economies.
“As AI regulation and ethical frameworks take shape, developing nations must have a seat at the table to ensure AI serves global progress, not just the interests of a few,” the report emphasized.
Investing in Workforce Adaptation
Despite fears of automation replacing jobs, UNCTAD underscored AI’s potential to create new industries and empower workers. The agency called on governments to invest in digital infrastructure, reskilling, and workforce adaptation to ensure AI enhances employment opportunities rather than eliminating them.
“AI is not just about replacing jobs,” the report stated. “Investing in reskilling, upskilling, and workforce adaptation is essential to ensure AI enhances employment opportunities rather than eliminating them.”
As AI continues to reshape the global economy, UNCTAD insists that immediate action is necessary to bridge technological gaps and create an inclusive AI-driven future.
