DESI

On 25^th February, the European Commission published the result of the 2016 Edition of the Digital Economy and Society Index (DESI). Good news. Data show a general growth; however, we are still far away from the full development of our digital capabilities.

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What is the DESI?

The DESI is an online tool to measure the progress of EU Member States towards a digital economy and society. More than 30 indicators define the DESI and are grouped into five policy areas: connectivity (25 % of the total score), human capital/digital skills (25 %), Internet use (15 %), integration of digital technology (20 %) and digital public service (15 %). Indeed, this index is used to identify which sectors needs more investment in order to improve the country’s performance.

The index not only shows the general status of the European Union -still far from the level of digitalization of countries such as the US or Japan-, but also points out the considerable differences among Member States. Denmark, Sweden and Finland take the lead in Europe but they are also top countries in world rankings. At the very bottom are Czech Republic, Bulgaria, Cyprus, France, Greece, Hungary, Poland and Slovakia: not only their DESI score is well below the EU average, but data show also a slower growth rate, which will increase the distance from the rest of EU members. The DESI, indeed, also shows the growth rate of the nation in the field of digital technologies. And here, once again, we can see a multi-speed Europe.

Some countries have a DESI score higher than the EU average, but also record a faster growth in the last year. We are talking about Austria, Estonia, Malta, Portugal, Germany and the Netherlands. Good growth rates also in Italy, Croatia, Lithuania, Romania, Slovenia and Spain, although their DESI score currently remains below average. However, according to analysts, there are good hopes for these countries to reduce the distances from the most digitally advanced countries. By contrast, a drop has been recorded in the growth of Denmark, Sweden, Finland, Ireland, Belgium, Lithuania and Ireland, though they DESI scores are still high.

What should we do to improve the situation? Last year, the EU approved the Digital Single Market strategy, a set of initiatives that countries have to deliver by the end of 2016 in order to coordinate and standardize digitization processes in EU countries. This strategy is built on three pillars: improving access to goods and digital services for consumers and industries across Europe; create a favorable environment and equal opportunities for the development of digital networks; maximise the growth potential in the sector.

Apparently, the implemented strategy is paying off. 71% of European households now have broadband access at high speed (in 2014 only 62%), while the number of subscribers to mobile broadband has increased up to 75 contracts every 100 inhabitants (compared to 64 last year). It is true, however, that there is still a lot of work to do, especially in some sectors. As the DISE report points out, for example, almost 45% of Europeans do not have basic digital skills, e.g. the use of email or the main editing tools. The e-commerce is still far from being a reality for small and medium enterprises: only 16% of them sell their products online and only 7.5% across the border. Promoting online shopping is not enough: it is essential to encourage electronic commerce, by approving a better legislation to protect consumers, especially in cross-border shopping. Finally, the data on public services are not satisfactory at all. Despite a greater variety of services made available online by Public Administrations, it seems that only 32% of users actually use these platforms.

On one hand, therefore, it is important that the EU provides a coherent and effective legislation that protects both citizens and entrepreneurs; on the other, Member States must support the creation of the digital single market, investing in the most underdeveloped sectors and promoting the digitalization of civil society. Achieving this goal will revitalize the European economy in general and make our market more competitive, but it will also allow EU members to make the most of the untapped potential, creating new opportunities (especially across the border) for enterprises, but also for individuals.

Paola Fratantoni

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