Not Just Advantages. What Are the Dangers Behind Digitalisation?

Today’s world is being shaped in new conditions, where digital technologies are gaining more and more weight. They can greatly increase the level of labour efficiency and well-being of people, meet the challenges of health, education and state management (these advantages are particularly evident now, during the COVID-19 pandemic), but also increase the level of innovation of the economy or reduce the carbon intensity.

The combination of digital technologies and physical infrastructure has become the basis for the development of smart infrastructure.

Smart infrastructure creates contaminated or more efficient sites, but also generates huge political capital and great opportunities for business. Together with this smart infrastructure can not only serve as the “solution” to all problems. The combination of infrastructure and technology is changing the way how cities, regions and even countries operate, which can create a number of challenges that cannot always be quickly responded.

Razumkov Centre for Economic & Political Studies conducted a study, which assessed the dangers associated with the development of smart infrastructure, as the part of the project called “Smart infrastructure in sustainable urban development”.

The degree of risk of the widespread introduction of smart infrastructure

Low Middle High Uncertain
Personal data leak 2,8 26,9 67,6 2,8
Problems in the operation of computer systems 12,4 38,6 46,2 2,8
Interference with private life 13,8 40,0 42,1 4,1
Dissemination of modern methods of manipulation of public opinion 22,1 30,3 40,0 7,6
Increasing digital ‘social inequality’ 17,9 42,8 32,4 6,9
Increased threats to city safety 41,4 33,8 17,2 7,6
Increasing unemployment due to automation of production processes 28,3 48,3 16,6 6,9
Prevalence of primitive mass culture 44,1 25,5 15,9 14,5

* 145 experts took part in a surcvey.

Although digital technologies are very widespread today, there is still a lack of research on whether they are ‘safe’. The risk lies in the possible leakage of data and the access to it of unauthorized persons. The amount of personal data collected over the Internet of Things is constantly increasing and such interference in private life is concearning. The main issue is the lack of full consent to the collection and development by the system of personal data, as well as which specific data should be collected and how that data should be analysed. This carries the risk of losing privacy.

Almost every business nowadays relies on software to create, manufacture, distribute and post-sales support products and services. Therefore, some technical errors may result in unreliable or outdated information.

Another threat is the prevalence of modern methods of manipulation of consciousness. While digitalisation increases opportunities for freedom of expression, the dissemination and exchange of information, there are also risks of inappropriate information and insufficient transparency of its sources of origin, making people incapable of being full participants in information streams, and abandoning their views in favour of group thinking and the polarisation of views.

Nor should we deny the risk of digital polarisation of space. Many people live on the poverty line: 1.3 billion people do not have continuous access to electricity, 1.15 billion do not have access to telephone services, 2.5 billion don’t have access to basic sanitation services and 800 million don’t have access to water resources. So the concentration of the population that consumes digital services in large towns can result in the emergence of territorial digital inequality and social stratification.

There is also a risk that not all layers of society will be able to take advantage of the advantages of digital technologies by not accessing modern equipment, which could jeopardise the inclusion and emergence of the so-called ‘digital elite’.

The threat of cyber attacks is also increasing. In the absence of set standards and regulations, digital technologies are becoming a tool that threatens people, society and the state. Among such threats are cyberespionage and cyberterrorism. According to Allianz Risk’s annual analysis, the risk of cybercrime is one of the biggest for business in 2021. Today, cybercrime costs the global economy more than 1% of global GDP. Therefore, the question arises: can it be called ‘smart’ technology, through which hackers can ‘isolate’ entire cities or states? We can come to the conclusion that the increase in digital security risks, including data protection, increases distrust of technology.

In addition, there are also many social risks. Automation of work and the use of robots can turn physical work, which means that many people will lose their jobs and sources of income.

This will result, among other by:

— structural unemployment, caused by the impossibility of adapting the necessary skills

— increasing the pay gap that digital technologies require more habits and knowledge to exploit them

— less access to social packages when hiring online

Furthermore, there is a risk of reducing cultural development, that digital culture will not replace the exchange of information in cultural centres.

Low trust in electronic services, aversion to living in the world of digital technologies and a lack of understanding of the advantages of digitalisation also cause a number of psychological problems

We cannot stop technological progress, but the impact of digital transformation on today’s world is not clear. Digitalisation creates new challenges related to the unequal distribution of digital goods, the polarisation of the labour market, cybersecurity, etc. There are currently no general principles (adopted at international level) that cover all issues related to digital transformation. However, an important step at national and international level could be to resolve disputes over statistics on the use of digital technologies and the upsival of smart infrastructure, which could help to better understand their impact.

* The material is prepared on the basis of an analysis entitled, “Smart infrastructure in sustainable urban development: global experience and prospects of Ukraine”  (


Kateryna Markevych

Leading Expert, Economic and Social Programmes

Born in 1989 in Dnіpro


Dnipro National University named after Oles Honchar (specialty: International Economic Relations, Bachelor's Degree, 2010)

T. Shevchenko Kyiv National University, Institute of International Relations (specialty: International Economic Relations, Master's Degree, 2012)

External PhD student of the National Institute for Strategic Studies. Subject of dissertation is "FDI influence on the economic security of Ukraine"


2009 — Land Commission and Commission on Environment of the Dnipropetrovsk City Council

2009 — International Business Department of the Dnipropetrovsk Regional Public Administration

2011 — Secretariat of the Committee on Foreign Affairs of the Verkhovna Rada

2012 — Department for Facilitation of Investment Activity and Regional Development of the Ukrainian Chamber of Commerce and Industry.


2012 — Consulting Company "H-aRt"; Public JSC "Ukrnaftokhimproekt" (engineering company)

October 2012 – March 2014 — Junior Expert of Economic Programmes of the Ukrainian Centre for Economic and Political Studies named after O. Razumkov

Since March 2014 — Expert of Economic Programmes of the Ukrainian Centre for Economic and Political Studies named after O. Razumkov

Field of Research: international investing activity, foreign economic policy, economic security, FDI in MSE

Author of scientific articles and a participant of more than thirty scientific conferences devoted to investment activities of the Ukrainian economy, foreign investment activity in the countries BRICS group

(044) 201-11-98