In August, the UK officially announced their bid to be a frontrunner in the global artificial intelligence race. Richard Wood, Her Majesty’s Ambassador to the Kingdom of Norway, issued a speech at the Tech City Executive Accelerator conference; Wood said,

“Beyond making our lives easier, smart systems help us solve some of the world’s biggest challenges: treating chronic diseases, fighting climate change, and anticipating cyber-security threats.”

He cited a report by McKinsey that estimates the AI industry to be worth $3.5 to $10 trillion globally, and predicts a 60% annual growth rate by 2022 in the UK alone, building up to contribute £650 billion to the UK economy by 2035.

“We expect that implementing AI technology will carry huge economic implications. If we use AI in the right way, we can create a more prosperous economy with better and more fulfilling jobs,” Wood said.

Recent reports have stated that the Pentagon has been showing increased interest in AI, having launched the Joint Artificial Intelligence Center (JAIC). The Department of Defense is said to have allocated $75 million of its annual budget to the center, with plans to dedicate $1.7 billion to it for the next five years.

What are the monetary impacts?

Apart from the revenues ahead, the economic implications of AI applications are widespread — its effects will resonate across government agencies.

One major change this will bring into government regards efficiency. Services will be better, cheaper, faster, and — provided that the core algorithms in place are refined — there will be fewer errors in processing; this should lead to more accurate and streamlined systems. So not only will AI increase revenues, it will cut down costs and free up resources to be allocated to public benefits or other efforts that would benefit the taxpayer.

In fact, Deloitte published a study on this, “AI could free up 30 percent of the government workforce’s time within five to seven years,” they found. And the savings, depending on how much is invested, range between $3.3 billion to $41.1 billion for the federal government, and $119 million to $931 million for state governments.

These funds will be better spent on benefits and services rather than for maintaining physical branches and personnel. And with the digitization of everything, at some point, even the citizens may no longer need to be physically present for what they need from a government agency — which means no more queues.

Artificial intelligence combined with blockchain technology makes one major powerhouse.

When government representatives talk about emerging technologies and budget allocations for futuristic ventures, it’s quite common to find blockchain and AI bundled together under the same fund; this is because combined, these two fields can change governments in ways we cannot fully perceive at the moment.

Combining AI and blockchain can bring several benefits and create equality among citizens. For example, financial inclusion can be achieved by creating a blockchain-based ID system coupled with an AI-based fraud scoring and risk analysis system to extend financial services and loans to the unbanked — people who lack any credit history. Throw in biometrics, and you have an even more robust ID verification system.

In theory, blockchains can power entire governments. In fact, that’s what a blockchain is, a virtual, decentralized governance system that is ruled by code. But of course, a theory is easier than real-life execution; human custodians are still required, and in the case of a blockchain, a network of nodes that can validate the consensus rules.

Blockchains enable the pooling of resources from a global-scale network, such as computing power and data, two of the most valuable assets of modern society. Imagine the whole world’s information, computing power, and its brightest minds coming together on a massive collaboration system that’s being analyzed by a machine learning algorithm.

With this in mind, it’s not hard to see why many people — industry authorities, nonetheless — say these technologies have the potential to solve the world’s most significant problems.