The future digital policy and why it should be prioritised for EU funding
The EU single market is currently hindered
from its full potential due to several barriers encountered by citizens,
businesses and public authorities in their daily activities across borders. The
existing digital innovations and new technological developments created by
European businesses, SMEs and start-ups need a substantial boost in order to
maximise its strengths and to stimulate further innovation. Boosting the
Digital Single Market strategy is already and will bring substantial economic
and social benefits to the European industry and services, improve consumers’
access to goods and services, increase productivity and create new employment
opportunities.
This paper takes a look at the
current setbacks encountered in the EU that need to be identified and timely
addressed by regulators and investors. At the same time, its impact is already being
tackled by high-technological developments. However, despite increasing
investment by the private sector, Member States cannot neither act alone and
must collaborate through an EU level strategy. Such an ambitious goal can only
be achieved if the European Commission, Member States and all stakeholders are
willing to invest meaningful resources which have the capability of being
drivers for change.
For this reason, the EU should make the Digital Single
Market strategy one of the priorities of the Multiannual Financial Framework,
effectively combining and complementing private investment with EU funding
programmes, as well as, other sources of national public investment. Only
through a coordinated investment approach, it will be possible to successfully
and efficiently implement the three pillars of the DSM strategy: better access for consumers and businesses
to online goods and services across Europe, creating the right conditions for digital networks and services to
flourish and maximising the growth
potential of our European Digital Economy.
Digital innovation and future
developments
Over the last years, the
developments undergoing in the ICT sector and new technological innovations
taking place in our society have changed the way people work and live. From its
use in a household to in a multinational company, digital solutions increase
opportunities that can facilitate and sharpen growing market potential.
A digital economy is composed by
several elements, including, the necessity to build trust and confidence
through cybersecurity tools, the provision of free and open internet and the
boost of digital skills and literacy in the workforce. The investment in the
following four matters, as addressed below, may create in the medium to long-term
major progress to the EU, if investment in the digital policy becomes an EU
priority. It must be considered that the scale-up of the mentioned digital
solutions are interlinked and the investment in one of these issues requires a
consistent and integrated investment strategy for the next years to come.
Digital
skills
The rise in the use of different
kinds of mobile technologies and communications media, and the ease of internet
connectivity across the EU are key factors in the growing number of digitally
literate citizens. Yet, digitisation generates increasing repercussions on
labour markets. ICT-based mobile work is hindered, in particular, due to the
lack of technical support and expertise as well as the prevalence of a
traditional business culture based on strict working procedures.
To accomplish a fully digital-skilled society, there needs
to be, not only a direct financial investment in Member States, and in
particular, in less developed and remote regions, but also, a complete modernisation and reform of the
education and training systems that will make digital skills a priority for
students and future workers. Digital-skilled employees have shown high levels
of productivity and competitiveness benefits to our economy, which only tend to
grow further. Despite the actions taken at EU level and currently implemented
at national level, digital skills should remain a high-priority for EU funding.
Data-driven economy
The access to and use of data has become more than ever a
vital resource to our economy. Data helps businesses expand their cross-border
activities, consumers to be informed and public services to modernise their
infrastructures. Intrinsically, the EU must guarantee that the free flow of data is an integral part
of the fundamental freedoms of the single market and no restrictions hinder its
full potential.
Internet of Things, cloud services and Big data are digital
solutions that have not, today, achieved its full potential. A fragmented market,
the lack of open and interoperable systems and services as well as concerns
regarding security, compliance and data protection represent a series of
barriers to its use across sectors and Member States. The implementation of
these solutions requires a transformation on the way businesses and the public
sector is organised and functions, and the modernisation of its infrastructures.
Investments must be addressed at EU level in order to trigger the cross-border
operability and access to data.
Digitising European industry
The EU has traditionally a strong
manufacturing base that has been an essential building block of the single
market. Today, research and innovation (R&I) have put forward technologies
that are key drivers for future economic and productivity growth. On this
matter, it is essential that Member
States collaborate in order to foster cross-border digital innovation hubs which
are building key technologies for smart industries.
The use of artificial intelligence and robots in
manufacturing and devices can make them more responsive and autonomous to be
benefit of energy, healthcare, agriculture and transport sectors, for example.
The EU must keep funding projects from innovative industries and start-ups
currently developing artificial intelligence technologies and ensuring that
robots and humans can work in the safest way possible.
In order to plan the development of the next generation of
digital industrial platforms, the actions driven by the EU are key to mobilise
a mass of investments that will leverage R&I and have a meaningful impact
on all sectors of the economy, through private and national public investments.
Innovating
European services
The services sector is the backbone
of the European economy. As the digital policy has changed the way Europeans
live and work, access and use services, further technological innovations are
being envisaged. For instance, the application of Financial Technology (FinTech)
is progressively being used across a wide range of market segments and provides
efficient solutions aimed to improve access to financial services and
competitiveness of other services.
The technological innovations involved are extensive and
include automated advice, algorithms, artificial intelligence, big data,
crowdfunding, sensor data analytics, cloud computing, robotisation and machine
learning, Application Programming Interfaces (APIs), distributed ledger
technologies (DLT) and remote identification technologies. Likewise,
stakeholders recognise that Regulatory Technology (RegTech) could contribute to
reduce compliance costs and make internal risk management systems more
efficient by automating checks on companies, people and ID documents, in
particular, to the benefit of anti-money laundering, cybersecurity, Know Your
Customer requirements, fraud and market abuse detection and supervisory
reporting.
As the European Commission is undertaking a complete
assessment into the possibility of an EU level regulatory initiative for
FinTech, it has to be taken into consideration that different sectors may
indirectly benefit from these developments, as regards payments and secure customer identification. The emergence of these
technologies to a commercial-scale is imperative so that we can guarantee the maximisation
of its full potential.
Opportunities for growth
The completion of the Digital Single
Market could contribute with 415 billion EUR per year to the European economy. The
Digital Single Market is affected by long-standing and deep-rooted obstacles
which impede EU cross-border investment and growth in a variety of sectors.
These barriers deter businesses from diversifying their centre of activities
across borders, reduces market opportunities and makes it harder for companies
to scale-up.
Thus, a concrete and integrated investment plan is necessary
for citizens, businesses and public infrastructures and would be key to maximise
the digitisation of several sectors of the European economy. The European
Commission must continue its support on the delivery of the Digital Single Market
strategy through ongoing funding programmes, such as, the European Structural and Investment Funds and the European Fund for Strategic Investment.
In addition, Horizon 2020 is the EU’s programme for R&I that supports
financially high-quality research and innovation projects with a scientific,
technological and societal impact. The EU must continue its investment in
R&I, a strong foundation for new technologies and disruptive innovations
and a major influence to the Digital Single Market. Such strategy will not only
generate new goods and services which are European products, but also attract
and employ highly-skilled professionals from the EU and beyond.
The mid-term review
of the Multiannual Financial Framework 2014-2020 has already allocated a
broader package to smart and inclusive growth which will have a great impact on
competitiveness and job creation. Yet, the EU should look into future opportunities
and plan ahead to make the digital policy a priority for EU funding.
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