DIGITALEUROPE – European leaders should focus on policies to boost digitalisation of industry and jobs

“Digitalised companies grow two and a half times faster than non-digital companies. European leaders should focus on our strengths and drive the digitalisation of industry. Future generations need a strong, digitalised and competitive Europe.” said Cecilia Bonefeld-Dahl, Director-General of DIGITALEUROPE.

Today DIGITALEUROPE published ‘A Stronger Digital Industrial Europe’ – our contribution to the future European industrial strategy.

The paper will be presented today at Masters of Digital 2020, our flagship annual digital policy event, taking place at the Royal Museum of Fine Arts.

Cecilia Bonefeld-Dahl, added:

Europe needs to build on its strengths in business-to-business industries in areas such as health, manufacturing, green tech, energy, and transportation. Digitalisation has huge potential to make our industry greener and more competitive, and to provide good, well-paid jobs.

We urge Member States to put their money where their mouth is on the EU budget. When leaders gather in Brussels on 20 February they need to set an ambitious goal for digital investment, right now it is only 3% of the budget – anything below 10% would hinder the implementation of the vision of “A Europe fit for the digital age”.

For a sustainable, prosperous and stronger digital Europe, a comprehensive industrial strategy with digital transformation as its FOCUS is essential. These are the five key areas that require action from decisionmakers in the next five years:

Framework for a European digital transformation of industry

• The EU must drive the digitalisation of our industry, building on existing strengths in manufacturing, mobility and health and focusing on areas of the common good such as the environment, digital skills, connectivity and cross-border data spaces.
• We need to boost digital spending up to 10% of the EU budget, of which half should be focused on deployment. It is currently just 3% in the Commission’s proposal.
• The Digital Europe programme should be increased from €9.2 billion to €25 billion to maximise the short- and medium-term impact on skills, AI and SME digitalisation across the EU.

Open markets and fair global competition

• Europe must lead at the international level: on World Trade Organization (WTO) reform, on digital trade negotiations, and on data flows.
• The EU should open up global markets for our digital companies, promoting new tools like the International Procurement Instrument.

Crucial aspects of digital transformation

• The EU and national governments should commit to spending at least 3% of its GDP on research and innovation, with a focus on digital technologies. Currently, it is just 2%. This lower than most major countries such as Korea (4.5%), United States (3.2%) or China (2.2%)
• The EU should build a trustworthy AI environment which promotes innovation. Europe should focus on regulating limited high-risk AI applications and adopt a sector by sector approach. SMEs in particular need guidance and resources.
• We need to prioritise building a 5G and high-capacity network throughout Europe in order to boost our industrial connectivity.
• Europe can lead on cybersecurity if it can guarantee a strong and coherent legislative framework at EU-level and avoids fragmented rules.
• We support the introduction of Common European Public Data Spaces for areas like public transportation, health, or air quality. This also requires a strategic approach to allow businesses and authorities to gather, store, pool, share and analyse data securely.

Upscaling SMEs and upskilling the workforce

• Digital Innovation Hubs (DIHs) must play a crucial role for the participation of SMEs in collaborative research programmes on digital technologies
• The EU should develop standardised metrics to measure the digital skills gap in each Member States. It should also build data models to analyse and forecast future skills needs.
• Governments should put digital skills on the school and university curriculums.

Sustainability goals to drive industrial leadership

• Digitalisation is key to the Green Deal. It can transform our most energy-intensive sectors. We know that digitalisation has the potential to reduce global CO2 emissions by 20%.
• The EU should develop performance indicators to measure the decarbonisation sustainability potential enabled by digital technologies.
• The EU should also allocate specific funds towards the implementation of digital technologies aimed at decarbonisation and the circular economy.