United Nations, Dec 3 : Artificial intelligence (AI) unmanaged could increase inequality between countries by widening divides in economic performance, people's capabilities, and governance systems, as the starting point is so vastly different, according to a report released by the United Nations Development Programme (UNDP).

The report, titled "The Next Great Divergence: Why AI May Widen Inequality Between Countries," highlights that although AI opens important new avenues for development, countries begin this transition from highly uneven positions to capture benefits and manage risks.

"Without strong policy action, these gaps can grow, reversing the long trend of narrowing development inequalities," Stephane Dujarric, spokesperson for the UN secretary-general, told a daily briefing.

Asia and the Pacific region, home to over 55 per cent of the world's population, is at the center of the AI transition, hosting more than half of global AI users and rapidly expanding its innovation footprint, according to the report.

AI could lift annual GDP growth in the region by around 2 percentage points and raise productivity up to 5 per cent in sectors such as health and finance. ASEAN economies could see nearly $1 trillion in additional GDP over the next decade, it said.

At the same time, millions of jobs, especially those held by women and young people, face significant exposure to automation, if core principles of ethical and inclusive governance of AI are not considered, the report mentioned.

"For much of the last half-century, many lower-income countries have gradually closed the gap with higher income countries through advances in technology, trade, and development. This 'era of convergence' brought significant improvements in health, education, and income," Xinhua news agency reported.

However, without deliberate and inclusive policy choices, AI may now cause the erosion of these convergence gains, the report warned.

"Digital readiness varies significantly across the region. Countries such as Singapore, South Korea, and China are making substantial investments in AI infrastructure and skills, while others are still working to strengthen foundational digital access and literacy. Building these digital capabilities will be critical to ensuring that all countries can benefit from the opportunities AI presents," it said.

"Limited infrastructure, skills, computing power, and governance capacity constrain the potential benefits of AI while amplifying risks, including job displacement, data exclusion, and indirect impacts such as rising global energy and water demands from AI-intensive systems," the report noted.

Only a limited number of countries have comprehensive AI regulations, and by 2027, more than 40 per cent of global AI-related data breaches may stem from misuse of generative AI, underscoring the need for robust governance frameworks, the report said, adding that this is a key area of 'catch-up' for many countries in the region and elsewhere.

/IANS