The Digital Single Market is not about bits-and-bytes, not about technologies, not about virtual media. It is about the people, it is about the citizens, it is about the jobs, quality of life and civic participation. Therefore it is important to look into the role of regions and cities in making the Digital Single Market work for Europe.
Our task is to boost digital skills, learning across society and the creation of innovative start-ups. We need to ensure digital literacy and skills for citizens, workers and jobseekers. This also includes the need to imbed digital technologies in education in order to prepare the future generations. We are looking forward to the European Commission’s New Skills Agenda 2016, which promises the promotion of life-long investment in people.
Not only is it enough to have local and regional authorities involved, we must engage our citizens and business to co-create and develop regions and cities together with all stakeholders, if we want to be successful and create thriving entrepreneurial ecosystems in our regions. Public sector, universities, schools, and the private sector all have to actively participate.
The main task of the European Committee of the Regions is to create a “bridge” between the policies and actions. In Europe, we need to connect to digital world in our everyday life in schools, universities, civic organisations and companies. Broadband connectivity in all regions, including remote and rural areas, is a prerequisite for this. The European Commission should report regularly on progress made in overcoming the digital divide, particularly at regional and local level.
Poor profitability means that in the rural areas there is often no market-driven development of high-speed broadband networks, so that the support options at European and national level need to be consistently further developed.
We need to engage cities and regions to invest in digitalisation and broadband connectivity and to use different financing including innovative public procurement and other funds. Here partnering is key to create growth and boost European economies.
In addition, we must continue to promote synergies between different programmes and financing instruments like EU structural funds and Horizon 2020 and European Fund for Strategic Investments (EFSI), and promote European multi-financing and integrated European funding in order to support cities and regions to reap the full benefits from the Digital Single Market. Cross-border, transnational and inter-regional cooperation are also crucial to exchange the best practices between regions.
Entrepreneurship is one of the strongest drivers of growth and job creation. Digital and web entrepreneurship in particular have the potential to boost the economic recovery of Europe. Cities and regions can create a favourable climate for innovations through their interaction with citizens, universities, civic society and local businesses. They have a pivotal role in creating a friendly environment for public and private investments and necessary conditions for the strong startup ecosystems.
In my own city, Espoo, I have participated in the creation of several initiatives to promote innovation and entrepreneurship, such as Aalto University, Startup Sauna, Urban Mill, and the Espoo Innovation Garden.
Investing in entrepreneurial culture and entrepreneurship education is an investment in the future. We have to make sure that promising entrepreneurs can obtain the funding they need to start a business. We have to cut down the regulatory burden our entrepreneurs face. We have to support start-ups that are ready to grow and internationalise, and we should also equip entrepreneurs with the necessary skills to successfully start and run a business.
The CoR is promoting entrepreneurship in Europe’s regions via the European Entrepreneurial Region (EER) awards, created in 2009. EER regions provide us with living examples that illustrate what regions and cities can do to promote entrepreneurship education.
One of the very first EER winners was Kerry County in South-Western coast of Ireland. The County has focused on the early stages of educating future entrepreneurs via Junior Entrepreneur Programme, which introduces entrepreneurship in schools for pupils from 8 to 12 years. The programme has been so successful that it was adopted nation-wide, with 10.000 pupils participating in 2015.
Along with digital divide, we should address the question of innovation divide in Europe. Particularly in rural regions, the public sector is a driver for change and a key player in raising local awareness. There should be a focus on innovation in the public sector itself, as well as on rethinking management processes in public institutions. This will enable these regions to catch up.
Commissioner Carlos Moedas highlighted in the CoR plenary session the new role of cities as the new global powerhouses for progress and societal innovation. Cities create favourable conditions for urban innovation – the synergic interaction between universities, civic society, local and international businesses as well as citizens. This is why we must renew the Urban Agenda to include the Digital Single Market, entrepreneurial spirit and human smart city initiatives.
Picture credits: Danka & Peter
I do want the Juncker Plan to be a success, yet I am not sure that what investors need more urgently is the European Fund for Strategic Investments but rather a regulatory framework conducive to their activity, says MEP Dominique Riquet.
The Juncker plan is still raising many questions with respect to its effectiveness. What’s your view?
Like the vast majority in the Parliament, I am very supportive of the idea of setting up an investment plan at EU level. President Juncker’s proposal goes in the right direction by targeting areas that are strategic for growth and by trying to attract more private funds.
At the same time, given the estimated investment needed in trans-European networks in the fields of transport, energy and telecoms until 2020 (around 1000 billion), the objective of raising 315 billion of investments may seem a bit limited.
For telecoms, the investment gap mainly concerns the deployment of broadband in rural areas as the private sector usually takes charge of other kinds of investment. Another area of concern with this plan is the financing of the EU guarantee fund.
Why taking money in programmes already dedicated to investment, which are fully operational and already foresee the possibility to use innovative financial instruments?
Finally, I am not sure that what investors need more urgently is the European Fund for Strategic Investments but rather a regulatory framework conducive to their activity. Trust is the key. However, I do want the Juncker Plan to be a success and we are currently working very hard on achieving this.
Will the so-called leverage effect work, notably in helping Europe meet its ambitious targets for ultra-fast broadband?
The leverage effect targeted by the Commission with the EFSI is 15, which is not unrealistic. We also know that there are dozens of trillions available in the private sector, within pension funds or insurance companies for example, and these liquid assets are insufficiently redirected to real economy.
The leverage effect will depend on the EFSI capacity to attract contributions from other actors and the cooperation between the EIB and national promotional banks will be crucial in that respect, together with the efforts in improving the regulatory environment.
Changing rules all the time, having a fragmented market where taxation and public procurement vary from one country to another clearly acts as a deterrent for potential investors.
The Digital Single Market Strategy presented Wednesday by the Commission is a crucial step in improving the EU competitiveness in this sector but it remains to be seen whether Member States will embrace the same ambition and have enough political will to put an end to all kind of obstacles.
Do you see the digital economy benefitting from the plan as touted by the European Commission? The proposal to divert funds from Horizon 2020 and the CEF to the EFSI, which the European Parliament has rejected, seems to prove the contrary.
The potential of the digital economy is huge and more should be done to reap its benefits. We do not want to choose between Horizon 2020, the Connecting Europe Facility and the EFSI as all are needed and this is why we have suggested to rather use unallocated resources such as margins and surpluses to finance the EFSI guarantee fund.
Just for 2014, the surpluses which remained this year were 1,4 billion, an amount which largely covers what we are supposed to put for 2015 in the EU guarantee fund. However, the surpluses currently serve to reduce Member States contributions to the EU budget which is why it is so difficult to use them for the EFSI.
As regards the EFSI, innovation and digital economy have clearly been identified as an investment area and there are a lot of possibilities : equipment of universities, support to SMEs in this sector, promotion of connected vehicles and of smart grids in order to reduce our energy consumption are just a few examples.
Negotiations between the EP and the Council have just started and they seem rather tense. What to expect?
There are a lot of divergences between the European Parliament and the Council but the main issue is by far the way we will finance the EU guarantee fund.
We are not protecting “our money” as I can hear from time to time. The Parliament is simply doing its job when defending programmes that have been democratically adopted just two years ago after a wide consultation, and I must say that in six years I have rarely seen our assembly being so united.
We are having the third trilogue today and, to be honest, the discussions have been quite difficult so far. If we are to find an agreement before the summer break as the Commission wants, each side of the negotiation will have to make efforts.
Dominique Riquet (born in 1946) holds a degree in general medicine and a degree in urological surgery. Elected at the European Parliament in 2014 for a second mandate, he is the first Vice-Chair of the transport and tourism committee and a member of the industry, research and energy committee. As a member of the UDI (Union des Démocrates et Indépendants) in France, he joined the ALDE (Alliance of Liberals and Democrats for Europe) within the European Parliament. Particularly involved in infrastructure financing, he was rapporteur on the Connecting Europe Facility and he recently created an intergroup on long-term investment. Prior to that, he was Regional Councillor for the Nord Pas-de-Calais region (1992-2009) and he also served for ten years as the mayor of Valenciennes (2002-2012). Follow him on: @