Let’s try to find it out by weighing the benefits and risks of Industry 4.0 to each of the elements in sustainable development. Industry 4.0, which is synonymous with the use of e-mail, social media, big data, artificial intelligence and blockchain, promises the hope of pushing forward societal progress — and it has proven to do so in many dimensions of sustainable development.

According to a report produced by Brookings, the digital economy added 3.5 percent to the total global gross domestic product in 2014.

In addition to adding value to global economic production, the digital economy has also benefited small and medium enterprises (SMEs) throughout the world by connecting them with the global value chain and by lowering the cost of entry through electronic trading platforms such as Alibaba, eBay and Tokopedia.

In the social development context, many governments around the world also use technology to downsize the number of bureaucratic hierarchies, to simplify administrative purposes through the e-governance system and to promote participatory democracy, which is believed to encourage the involvement of many stakeholders who were previously marginalized and not heard.

This reasoning is further strengthened by the occurrence of global events such as the Arab Spring, which demonstrated how a democratic struggle against an authoritarian regime complemented with technology can
create a democratic movement in the region.

In the environmental context, Industry 4.0 provides hope for the growth of a green economy with the development of renewable energy technologies, as the increased deployment of renewable technology had successfully reduced global carbon emissions in 2018.

The application of Industry 4.0 in the green economy can also help optimize the renewable energy production system if we combine it with the internet-of-things.

Many companies, such as IBM, have also been experimenting with using block chain technology to trace sustainability and ease the materiality assessment of several products.

While so far, it may seem that both forces continue to be a great combination, just like the honeymoon phase in a marriage, we tend to be blind to the negative impact that comes as a result of the convergence of these two forces. And as we continue to have this paradigm, it actually may expose us to unexpected risks, such as the reduction of jobs.

In a study conducted by the McKinsey Global Institute in 2017, the trend of automatization may have the potential to affect 40 percent to 55 percent of global wages, with almost half of the work globally having the potential to be automated by current technology.

The trend of automatization would also reduce the marginal costs of many products and thus encourage the reoffshoring trend, whereby global production will reshift to developed countries as production costs continue to decline.

In the social context, the success of marrying digitalization with participatory democracy is very much dependent on digital dividends and citizens’ access to broadband and affordability of attaining mobile subscription.

Other than that, the question of whether democracy can be strengthened by technology still produces ambiguous results as the occurrence of the Arab Spring has had an impact only in the country of Tunisia, which is slowly turning into a pluralistic country, whereas other countries like Egypt returned to the same authoritarian state.

The establishment of the New Turkey Digital Office to promote government propaganda and orchestrate intimidation campaigns of dissident journalists also negates the argument that internet and technology has the power to promote positive democracy if such a democratic foundation never existed before.

The impact of connecting the green economy and Industry 4.0 has its own perils too. If we move our attention from the benefits of renewable energy to the impact of producing materials for renewable energy, like wind turbines and solar panels, then we may have a less rosy picture. Most renewable energy technologies constructed with rare Earth minerals like lead and manganese as their main components are usually extracted from countries that have high levels of conflict, such as Congo and Guatemala.

In addition, a report produced by United Nations University in 2018 shows a staggering increase in the amount of global electronic waste generated and with only 20 percent is properly documented and recycled.

If it continues to be untreated, the problem will proceed to be a global epidemic due to its health and environmental hazards.

As we can see, the impact of these two forces entails both opportunities and challenges, yet the balanced narratives remain unexplored globally.

If this continues, this will continue to amplify the risk that we did not see before and encourage losses. It is time for Indonesia to think about the challenges that exist and also discuss this significantly to reduce the risks that
lie ahead and try not to compromise sustainability for the sake of technological development. Indonesia should also think of the appropriate governance to deal with this.

Indonesia can look toward the German government, which has formed an implementation strategy for shaping digital change that openly provides a list of challenges and also a detailed implementation plan aimed at reducing the risk of Industry 4.0 to all dimensions of sustainable development.

Although we may not have a comprehensive strategy at this time, but it is better late than never to list the possible challenges and discuss the issue openly, just like what a happy married couple should do.

__________________________

The writer, an alumna of Managing Global Governance 2017, currently works at UCLG ASPAC as training coordinator for the EU-SDGs project. The views expressed are her own.

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