For two days, authorities from the public and private sectors, entrepreneurs and experts discussed the future role of the "Internet of Things" in the digital economy and its importance for Chile.
In his opening remarks, Andrés Couve, Minister of Science, Technology, Knowledge and Innovation, argued that a sustainable economy "is not optional" and that the academic, private and public worlds must collaborate to promote competitiveness and innovation, based on science and technology.
"Despite being a small country, Chile has advantages such as the 'natural laboratories' in the south and the astronomical centers in the north that we have to take advantage of to be able to offer global services based on innovation," said the minister.
"While the country has made great advances in infrastructure for connectivity such as the southern fiber optics and has promoted public policies favorable to an entrepreneurial environment, there are still gaps such as the training of advanced human capital and more investment by the private sector," he added.
Along these lines, Julio Pertuze, head of the Economy of the Future division of the Ministry of Economy emphasized that previous economic revolutions, such as the industrial one, have occurred "when processes are innovated."
With new advances in automation, 50% of jobs will be affected. That is why Chile cannot be late to the 4.0 economy. Pertuz highlighted astronomy as a differentiating factor for the country, which could account for 70% of the world's astronomical data by 2024.
5G
5G will be the key infrastructure for the evolution of IoT, due to its capacity for high traffic speeds and low latency, which will enable real-time decision making based on data captured by thousands of sensors.
Santiago Fontán, sales director for South America at Qualcomm, recommended that authorities award local spectrum licenses to promote different industries. Meanwhile, Roberto Cabanillas, director of digital services at Ericsson, said that the digitization of industries based on 5G infrastructure could generate a potential 36% increase in business revenue.
However, for the CEO of Memetica, Daniel Kopric, this digital transformation will have a high impact on the culture and employees in organizations, which will have to look for new talent.
MINING
Large-scale mining, a key part of the Chilean economy, is preparing for these changes.
The Advanced Mining Technology Center (AMTC) at the University of Chile is exploring the application of technologies such as big data analytics, automation and artificial intelligence for mining companies.
AMTC executive director Javier Ruiz del Solar said that greater collaboration between innovation centers and supplier companies is essential to transform prototypes into products.
The safety of people is the main objective that mining companies are looking for with automation.
"The machines do the work, the software does the intelligence and the people control it," explained Ronald Monsalve, of the state copper commission Cochilco.
He added that, like Australia, Chile has a great opportunity to create digital services and export them, based on engineering for mining.
State-owned copper producer Codelco is rolling out a BIM model, which is a process backed by various technological tools that helps companies study, plan and monitor the effectiveness of new projects.
According to Nancy Pérez, Codelco's vice president of projects, only a mine with 100% digital and integrated operations will be able to take advantage of technologies such as artificial intelligence and big data.
Innovation is also revolutionizing the energy industry.
José Ignacio Escobar, general manager of South America for Acciona, commented that drones and 3D technology are being used to inspect energy infrastructure which allows reducing the costs of human inspections. Blockchain also has potential to track the origin of renewable energy.
"Despite being a long-term industry, the speed of change is increasing every day and you have to adapt," he said.
STARTUPS
The founder and CEO of Spring UP Technology Entrepreneurs, Carla Muttoni, said they will have to take more advantage of the collaborative economy for the development of a digital ecosystem.
La ejecutiva destacó a empresas como WeWork, que no solo arriendan espacio para oficinas, sino que ayudan a crear un ambiente colaborativo.
Collaboration is also essential when seeking funding, according to Richard Haensel, founder of Zissmo, a Chilean peer-to-peer platform designed to connect private companies and investors around the world.
The state-run Start-Up Chile initiative has been successful in fostering an entrepreneurial culture in Chile, but the seed funding its participants receive is often not enough. That's why the initiative has introduced the "Scale" program, which offers additional funds to grow existing startups and help them avoid "the valley of death," according to Sebastián Díaz, the program's executive director.
REGULATION AND SAFETY
Growing the digital economy involves multiple regulatory challenges for governments, noted Germán Arias, former commissioner of Colombia's Communications Regulation Commission (CRC).
According to Arias, we must achieve industry standards and not impose national standards to allow the provision of services in cross-border mode, international data roaming, and infrastructure sharing.
"It is essential to rethink the role of the state in regulation so that it is not a barrier to innovation and development," he said.
Another major challenge relates to privacy and security.
Connecting thousands of sensors in industrial machines, in the home and in our vehicles also opens up opportunities for hackers and cyber attacks, according to Gabriel Bergel, Chief Security Ambassador at Elevenpaths, part of the Telefónica group.
"Both governments and companies will have to become more aware and implement policies and laws that protect user data," he concluded.
Carlos Landeros, director of the State Connectivity Network, said the Chilean government is working to improve cybersecurity through multiple inter-ministerial committees addressing critical infrastructure, international cooperation and new legislation, and is looking to strengthen investigative capacities, conduct educational campaigns and implement the Council of Europe's Budapest Convention on Cybercrime.
ELECTRIC VEHICLES
Nissan's electric vehicle manager, Francisco Medina, warned about the threats of global warming, population growth and increasing urbanization. He said that electro-mobility can help alleviate some of these effects, such as pollution from toxic emissions.
"By 2020, 9 out of 10 Latin Americans will live in major cities," he warned.
According to the studies, battery prices will drop dramatically by 2022 and the most conservative scenario estimates an annual growth in electric vehicle sales of around 111% for 2014-2023, or around 20,700 units sold.
In addition to the reduction in emissions, the new technologies will allow electric vehicle owners to harness surplus energy from their cars to power their homes and return unused energy to the grid.
HIGHER PRODUCTIVITY AND SMART CITIES
Chile has tremendous opportunities but also many challenges to increase productivity and participate in the global digital economy, according to Juan Francisco García Mac-Vicar, executive director of Corfo's Digital Transformation Committee.
He added that Chile is the last OECD member country in spending on innovation and development, investing only 0.37% of GDP, compared to Israel (4.25%).
"By 2021, at least 50% of global GDP will be digital, and the growth of every market will be driven by digitally enhanced offerings, operations and relationships," Garcia Mac-Vicar commented, adding that currently 80% of GDP takes place in cities.
Corfo's mission is to improve the competitiveness and productive diversification of the country, through the promotion of entrepreneurship and strengthening of human capital and technological capabilities.
According to a 2017 McKinsey report, digitalization in Chile could raise GDP by up to US$25,000, an increase of 0.7% annual growth rate.
That requires a roadmap and regional smart city programmes with initiatives such as Do! Smart City initiatives. The challenges are enormous, but the work has already begun.
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