Global Chairman and Senior Partner of PricewaterhouseCoopers LLP Robert E. Moritz has shared his views on the evolution of the digital economy in Russia and the prospects of AI application on the sidelines of SPIEF-2019.
Sputnik: Even though Russia's economy is quite stable right now compared to previous years, we see some concerns among business leaders and foreign investors about the business climate. In your opinion, what has to be done to improve the situation? And how much are the events such as this forum contribute to improving this business climate?
Robert Moritz: Well, it is clear that over the last couple of years there has been a stabilisation of the Russian economy from a local perspective, and that is good. It reduces the uncertainty of volatility. But what the business community broadly is looking for domestically here in Russia or internationally is a better understanding of the certainty around the rules, the administration's approach in terms of regulation, the rule of law and other aspects like that. And clearly, that is having a big impact on the local economy as well. So to make sure that we have stability and consistency around those rules and regulations becomes very important. Any PwC survey that we do about the economy, usually rules and regulations is in the top 10 list no matter what country, and Russia is no exception for that right now.
Sputnik: Your company did a creative capital index survey last year where St. Petersburg was named; it took second place after Moscow with quite impressive results when it comes to human capital and its power category. In your opinion, what has to be done by Russia to develop other cities? It is a huge country and there are other cities besides its first and second capitals.
Robert Moritz: As you look forward especially in the evolution of a digital economy, you need to make sure that a city has the ability to be a talent magnet: people want to be in that city because it is easy to live, it is easy to work. And looking forward, the ease of doing work is going to depend on technology and that goes to accessibility to the iInternet. It is going to go to great skills and education and access to people with those skills and education, and a great environment for innovation and creativity. Then it is going to fall into the other, softer issues in terms of the culture and the cultural aspects of a city that be afforded to people as they think about work and life and the flexibility that they are interested in. If you have those key ingredients in addition to logistics and cost of living, those are the secret ingredients that I think are going to be important as the new cities develop and equally as important sustain themselves over time.
Sputnik: There was another very interesting study done by PwC at the world economic forum this year that China is taking a lead in implementing AI in business processes with about one-fourth of Chinese companies already using artificial intelligence technology, which is a lot compared to what we see in the US with about 5 per-cent. And the Chinese also claim that AI will become even bigger than the internet in terms of the "next big thing" in terms of impacts. And less than 40 per-cent of American entrepreneurs think so. In your opinion, whose approach is more accurate and is the West lagging behind on AI application compared to China and Asia?
Robert Moritz: It is clear that China has taken a lead with AI in the breadth and scale of how they are using it across the country for the benefit of their country. And that comes across in the rise of the middle class over the last 10 years. I would not say they have got a competitive advantage or there is a right or wrong in terms of the approach. What we see is countries and companies have to react very quickly to the opportunities in front of them. Technology, specifically AI, is going to be a big opportunity for many organisations and even cities and country leaders. So what is going to be important is how do we create the technologies that are needed to access AI, how do we manage the data that is going to be needed to fuel AI, and how do we enhance adaptability and usability of the AI tools and techniques for better lives, better work, better travel, and better living.
Sputnik: So it is important to adapt the workforce for AI introduction?
Robert Moritz: Without a doubt. The number one issue we see around the world for countries, companies as well as cities is: is your workforce ready for the future? Skillset enhancement either through the formal education system, the informal education systems or the on-the-job education systems becomes increasingly important. Now, it is important from two perspectives. First is for those that are working today that they feel confident that they will have a job and job security going forward. But there are also hundreds of millions of people around the world that are disadvantaged right now; that don't have that opportunity for prosperity because there is no job opportunity. So we also have the need to help the disadvantaged have better access to technology. We hope to do that as you think about broader platforms. There is a way to deliver those skillsets electronically as long as the individual helps themselves be better. And if they do that I think then they have the opportunity to be successful in future regardless of where they may be.
*Views and opinions expressed in this article are those of Robert E. Moritz and do not necessarily reflect those of Sputnik.