Digitalisation of European industry lagging: EU auditors

(LUXEMBOURG) – Europe’s industry is not fully benefiting from advanced technologies to innovate and remain competitive, EU auditors said Tuesday, with some countries still lacking national digitalisation strategies.

The Commission launched the Digitising European Industry (DEI) initiative in 2016 with a view to boosting the digitalisation of EU businesses. However, progress of the initiative has been uneven among the EU Member States, according to the new report from the European Court of Auditors.

Some countries have also not taken certain specific actions, such as establishing Digital Innovation Hubs (DIHs).

The digital transformation of industry, or digitalisation, is more than just acquiring new IT equipment and systems. It involves using the possibilities afforded by new technologies to rethink all aspects of the business process. Digitalisation of EU industries has progressed in recent years, but at different speeds between countries, regions and sectors. There are also large disparities between large companies and small and medium-sized enterprises (SMEs), says the report.

The aim of the DEI initiative is to enhance the EU’s competitiveness in digital technologies and ensure that every business in Europe – regardless of sector, size or location – can benefit from digital innovations. The initiative aimed to mobilise close to EUR 50 billion of public and private investment in the five years after its launch.

One of the key elements of the DEI initiative is the establishment and operation of Digital Innovation Hubs (DIHs) to provide advice on technologies and networking to local businesses. With the exception of Germany, the concept of DIH has not been fully developed in the Member States visited.

The auditors also point out that not all Member States are likely to meet EU 2020 targets for broadband coverage. Furthermore, the take-up rate of fast broadband varies greatly between companies of different sizes (e.g. in 2019, only 46 % of SMEs had fast broadband access), and this is inevitably holding back the digital industrial revolution across the EU.

The auditors make a number of recommendations, which also take into consideration the proposed new Digital Europe 2021-2027 programme still under discussion. They relate to:

• helping Member States to identify their funding gaps, drawing their attention to the EU funding available;
• improving monitoring of the DEI initiative by setting appropriate result indicators and tracking spending;
• defining, coordinating and adopting the framework for a network of European DIHs covering all regions in Europe; and
• taking further action to support the achievement of appropriate levels of broadband connectivity.

Special report 19/2020: “Digitising European Industry: an ambitious initiative whose success depends on the continued commitment of the EU, governments and businesses”