Digital and innovation, Europe challenges the US and China

Digital and innovation, Europe challenges the US and China

Due to the fragmentation of the digital technologies market, the EU has not been able to keep up with the two global leaders. Despite this, something is changing, now

Vent’anni fa, l’Europa sembrava alle soglie di una nuova era, con un fiorente mercato unico e la nuova moneta appena lanciata. L’America, invece, si stava faticosamente riprendendo dal crollo delle dotcom, mentre la Cina era ancora alle prese con il suo passato maoista. Oggi la situazione si è completamente capovolta. Cina e America vivono un’irrefrenabile ascesa economica, con 76 delle 100 aziende più importanti al mondo collocate sui propri territori nazionali, contro le 15 dell’Europa, in vistoso calo dal 2000, quando erano 41. In più, il vecchio Continente non vede neppure l’ombra delle 19 aziende create negli ultimi 25 anni che ora valgono più di 100 miliardi di dollari: 9 sono in America e 8 in Cina. L’impressione, ampiamente supportata dai fatti, è che l’UE stia perdendo terreno a livello mondiale perché non si presenta come un vero mercato unico nel mondo high tech (The new geopolitics of global business).

Three Countries, three different points of view

While China and America are fighting for the dominant position of the IT market, especially thanks to AI, Europe is trudging. The United States feature an economy based more and more on digital giants in addition to a well grounded academic structure, but over the past year, for the first time, China has exceeded the American investments in AI, applying in various contexts. Europe’s delay, according to the Center for data innovation, is due to the fact that it doesn’t trust the AI. On the contrary, it is scared of it and, for this reason, it works more on rules aimed at controlling it than on its potential developments. It is worth pointing out, though, that Europe focuses on its citizens and their rights more than China and the US (AI leaders: who will be the winner among the USA, China and Europe?).

The European strategy

This does not mean that filling the digital gap is not a priority for Europe. Filling such gap, estimated as being worth over 190 billion Euros, if done by 2025, may actually lead to an increase in the European gross domestic product of 1,1%. The European Commission has issued an action plan addressing different hot topics, such as personal data protection to the need for nee rules about tech competition, to the need to implement digital skills and a new  digital tax. One of the priorities will be updating the privacy law protecting private citizens,  e.g. what has already been done with the GDPR, and companies, as well. Establishing new partnerships among companies and among the countries of the Union is crucial: Europe may become seriously competitive on the high-tech market only through networking (What Europe intends to do to fill the digital gap with the United States and China).

UE investments in the digital world

However, something is actually changing: thanks to the 2021-2027 financial plan and Next Generation Eu, Europe seems to have finally accept the challenge. According to a survey published by Marco Visentin from Bocconi University together with Virginia Poggi of the University of Bologna, out of 88,16 billion Euros devoted to research and innovation, 81,4 billions have been assigned to Horizon Europe 2021, the biggest transnational research and innovation programme in the world. Then there are 5 additional billion Euros for the R&D programme 5,6 billion Euros for the Invest Eu Fund, all coming from Next Generation Eu. Such relevant investments, together with a more collaborative and standardized approach, could open the way to a more equal competition among the three biggest market in the digital world .

Has Europe got some concrete chances to fill the gap concerning the hi-tech market? Tweet  @agostinellialdo

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