Artificial Intelligence (AI) and Machine Learning (ML) may be used interchangeably. These are basically algorithms or models built or designed to mimic the functioning and processes of the human brain. The main purpose of these ML algorithms is to perform pattern recognition, prediction, and control. AI remains a virgin area to date, with limited research available. If well-explored, it can provide feasible and unending solutions to global problems. Its applications may be in defence and the military, agriculture, medicine, monetary policy, energy, just to mention but a few.
AI has the capacity to improve production, increase efficiency and improve safety along production lines. AI-powered robots can continuously work around the clock, this ensures a continuous supply of output. According to Saxon reports, AI-powered robots could reduce labour costs by up to 33 percent, reduce unplanned downtime by 50 percent, reduce product defects by 50 percent and increase manufacturing efficiency by 20 percent.
The weather affects everyone on the globe. AI can be trained to accurately predict the changes in weather. According to a report by the Food and Agriculture Organisation (FAO), Uganda’s fertile agricultural land has the potential to feed up to 200 million people. Approximately 80 percent of Uganda’s land is arable but only about 35 percent is being cultivated. Agriculture contributes about 24 percent to GDP, 33 precent to export earnings and employs about 70 percent of the population. This underscores the importance of this sector to the economy of the country. Low productivity has been blamed partly on reliance on natural weather conditions. Accurate weather predictions by a trained AI could increase productivity and earnings of farmers.
Traffic control remains a huge problem all over the globe, particularly in the busy and modern cities. Optimal traffic control ensures that cities get decongested within the shortest possible time. This has a direct effect on the supply chain efficiency and movement of goods between the producers and consumers. AI algorithms study traffic movements and make predictions on the rates at which vehicles should enter/exit cities, without necessarily disrupting business. Timely decongestion of cities further has an environmental upside, less time in traffic means less emissions and pollution. Travellers also get to save on energy consumption. A study by researchers at Oak Ridge National Laboratory in Tennessee, USA, revealed that the application of AI in traffic control can save travellers up to 25 percent in fuel consumption.
In the field of economics and finance, there are several economic indicators like growth rates, interest rates, exchange rates and inflation rates, that are vital for monetary policy management and economic stability. AI algorithms are data-driven and learn how data behaves over time, this makes them very suitable in forecasting these economic indicators. Accurate predictions of these indicators are of prime importance; it can help Policymakers even predict the next financial crisis. Furthermore, for those trading assets like stocks and bonds, AI technology can predict price movements and enable them trade when it is optimal to do so. The AI algorithm may even be allowed to conduct the trade itself in the absence of a human trader.
In the business world, it is important to know how customers behave over time, particularly in the marketing niche. For instance, each time a consumer visits a website, AI algorithms gather data, analyse it, and make predictions about the next time the customer may visit or the next website the customer is likely to visit. This is done over time and predictability in behaviour becomes possible. This is an advantage to both the seller and the customer; the seller learns exactly what the customer desires. On the other hand, once the seller learns the customer’s needs, then there will be less need for the customer to hop from one seller to the next. It saves time and related costs. Thus, AI algorithms aid in target marketing and customer engagement management.
AI can be of extreme importance in the education sector. Its learning ability can enable educationists prepare curricular that is learner-centred, after carefully observing, gathering, and analysing data on learner behaviour and interests. This ensures that learners are taught what interests them and aligns with their career goals. In addition, exam grading, and performance analysis can be done by AI, with minimal errors.
Further applications are in predicting energy consumption and demand, predicting natural disasters like earthquakes, production and operating military equipment like drones, and so on. AI robots are being used in manufacturing, agriculture, space exploration, mining and even providing emotional support and therapy. According to reports by IBM, a technology multinational, AI applications in medicine include, among others, clinical decision support and imaging analysis.
Despite the upsides that come with AI, it is important to examine the downside of this approach to problem solving. There is a big possibility that once AI is globally rolled out, there will be mass unemployment of humans. Job loss will be inevitable. According to a recent survey by the World Economic Forum, estimates indicate that there will be a net loss of 14 million jobs worldwide over the next five years due to AI interventions. Goldman Sachs, a multinational investment and financial services company, predicts that in the United States and Europe, the sectors most affected by AI will suffer job losses of up to two-thirds due to automation. However, the multinational also predicts that this automation will increase productivity and Gross Domestic Product (GDP) growth by 7 percent over the next ten years.
Since AI is data driven, this means that it also has the ability to learn undesirable or unnecessary traits in the data. For instance, during the Covid-19 pandemic, there was a dip in economic activity that lasted more than two years. This is considered an abnormally when forecasting certain indicators like exchange rates. However, it may be a necessity when forecasting the next pandemic that may hit the globe. In addition to this, how about the data that it collects? How safe is it? Can it get into the wrong hands?
AI comes with a huge cost. The investment in research, development and infrastructure associated with it is enormous. This prevents developing and emerging economies from taking advantage of this innovation.
Last but not least, there is a fear that embedding human traits and behaviour into a machine may make these machines or robots even more intelligent than we, humans, and eventually the machines will become evil and turn on us, the ones that created them, leading to our very own extinction. In short, AI could outsmart us. This is a fear that several researchers and AI executives share, including the heads of OpenAI and Google Deepmind. Whether true or not, this will be revealed over time, after more research has been done.
In conclusion, considering all the advantages that AI brings, if applied in the day-to-day operations, it will enable several Governments across the globe achieve their objective of developing smart cities. However, the industry is still not well-regulated. There is a need to develop regulations that govern AI research, development, and applications; Policymakers are behind on this. The application of AI could signal the start of the next industrial revolution. The progress that humanity can make with AI is impeccable. AI applications are unending, will solve several problems and unleash several opportunities in probably all sectors relevant for global development.
The author, Emmanuel Erem, is a research Fellow, Economic Policy Research Centre, Makerere University, KampalaÂ
