The Digital Economy in 2025: Europe's Role and Weight in the Global Digital Economy

17 March 2009 Author: EIFonline

What will the global digital economy look like in 2025 and what will Europe's role and weight be in the world at that time?

3 distinguished speakers reflected on this subject during an EIF dinner debate in the European Parliament on the 17th of March. Gérard Pogorel, Professor of Economics and Management, Paul Hofheinz, President of the Lisbon Council, and Larry Hirst, Chairman for IBM in the EMEA region all gave their vision about a future Europe in the new economy.

In 2025, we will live in a smarter world because we will be able to obtain information and knowledge from everywhere. This will lead to new models of economic value. If we want a strong Europe within this new economy it will require that we become 'sustainably smart'. Combining smart leadership, smart investments, smart spending and smart laws to drive the new market.

We have to understand that companies in the new market will have lower margins because of lower prices for products and services (driven by much increased market transparency), and will be forced to focus more on generating new business. At the same time, customers will become like co-producers and companies will invest less in their in-house capacity. The growth of online mass collaboration will also be a factor in these new economic developments.

To be competitive in 2025, Europe should put money in creating innovation and not look at preserving old economic and legal standards. Curiosity based research at Member State and EU level would bring us closer to such an improved innovation system. Europe has great people, great engineers, but we seem to be less good in getting the right people together. There seems to be a gap in strategic design, as one of the speakers put it. In this respect we should also understand the key importance of the right educational framework, to make sure that Europe's people are 'fit for the future'.

Finally there is the question of the legal framework to support business. Technology has dramatically sped up possibilities for offering services and products, and it is becoming increasingly hard for regulators to keep up with the pace of technological innovation and implementation of an adequate legal framework. We should realize that technological advances are only at an early stage and as such it will be crucial for Europe to create or be part of a regulatory framework that is predictable to ensure businesses and consumers feel that they can operate in a trusted environment.


 

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