The formation of an appropriate ecosystem is the key to successful digitalisation

Publicated on: February 19, 2018

High-level Working Breakfast on “How to create a digitally future-proof world – Best practices from the Visegrad-4 countries”, Paris, 12 February 2018

The digital revolution is not a future prospect but a current reality. The increasingly rapid technical development represents a fundamental change in business and social structures, which is also a great challenge for governments. No wonder that Hungary - holding the Presidency of the Visegrad Group (V4) from 1st of July 2017 until 30th of June 2018 - pays particular attention in its program to digitalisation, in order to enable the Central European region to preserve and strengthen its role as „Digital Visegrad“ to overcome challenges with the help of technology-intensive micro, small and medium enterprises.

In his introductory remarks, Ambassador Dr. Zoltán Cséfalvay emphasized that „an adequate infrastructure is necessary for digital development, as the 5G or the high-speed broadband Internet access are essential conditions for both a competitive digital economy and a digital society that provides equal opportunities for all. His Excellency also highlighted the role of young innovative entrepreneurs, by saying, “the greatest support governments can provide for startup communities is by building ecosystems and implementing venture capital programs (VC) creating Hungarian ‘Jeremie funds’. Creating visibility and the promotion of global expansion are the keys to success“.

According to Mr. Alistair Nolan, Senior Policy Analyst at the OECD, „better and more intelligent revolutionary technologies are becoming increasingly important because of the decrease of OECD countries’ economic productivity and the old-age dependency ratio which is expected to double by 2050 with consequences regarding the physical and mental health of the population in particular". As for the effect of digital transformation on the labour market – although we do not know what the future holds – it can be established that „the artificial intelligence (AI) will be able to perform multiple and more complex tasks, which is why only employees with extended digital skills or higher education qualification can feel secure.“  Regarding digital infrastructure, only 23% of the EU-based businesses with internet access use cloud-computing services that leads to further global disparities.

Mr. Zsolt Kovács, founder and owner of Enterprise Hungary (EH) Ltd., a company that encourages young generations of the CEE region to become entrepreneurs and create their own startup companies, identified the introduction of the Visegrad region on the international markets as the most important task. For this purpose, Enterprise Hungary launched a program called Startup Campus V4 Global Tour was launched in February 2018, giving the opportunity for innovative businesses in the whole V4 region to promote their services and enhance their attractiveness to investors and large companies. Global Ambassador of the program, Ms. Lilla Tamás added that the EH has been organizing national tours under the name „Startup Campus“, and other similar events in countries all over the World (such as in Great Britain, Singapore or Germany). The Startup Campus V4 Global Tour, financed mainly by public subsidies, has attained a new level of performance in the company’s history and covers 10 metropolises from Istanbul through Tel Aviv to Los Angeles in 2018. Zsolt Kovács closed his keynote speech by noting that the success of the young generation lies in three components: networking, programs that are able to promote internationalisation and good mentors.

An open floor discussion followed the presentations, where the participating Ambassadors of the OECD member states expressed their appreciation for the projects of the EH. They agreed that for creating a digital future it is important to support young generations, promote the development of rural areas, ensure broadband internet access, and encourage the use of cloud computing services. In addition, there is a general need for governments to act more swiftly and flexibly on digitalisation and to build an ecosystem with the aim of supporting young talents and to extend their views beyond borders by focusing of ecosystems instead. The participants also agreed on the high importance of education as well as the efficient information flow in digitalisation. The OECD can help raise awareness to adapt to the economic and social changes and to modernize educational and training systems of the member countries.

Nick Johnstone, Head of Structural Policy Division at the OECD, addressed the closing remarks of the high-level working breakfast. He believes that the private sector seems to be digitalising at a pace for which it is hardly possible to ensure adequate policy response, given that different types of data are generated now than before, thus the traditional policy-making is no longer applicable. The block chain technology can bring us closer to the solution, but the key is the efficient regulatory environment that sustains risk-taking behaviour, such as treating bankruptcies, house financing and opening up new businesses. Johnstone concluded his presentation by pointing out that public investments in starting companies ought to be revised. The surveys of the OECD show that it is worthwhile for governments to consider mixed-financed VC programs where public initiatives are managed by the private sector.

Rebeka Tóth, András Hlács


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