Digital Frontier – A Way Forward
Europe faces a number of challenges that can be overcome only by an innovative, digitally savvy and entrepreneurial society. The digital frontier offers opportunities for innovation and introduction of new products for the global consumer, inclusion in education and workplace, and enables new ways of interacting, working and learning.
The Western Balkans region, a less developed part of the wider Central and Eastern Europe (CEE), requires a new growth model to reach the European digital frontier, a model based on innovation and entrepreneurial spirit of the new millennial generation.
The process should begin with a serious policy discussion on innovative entrepreneurship in the key sectors of digital economy, small and medium enterprise (SME) access-to-finance gap, regional ecosystems to support women, youth, and social entrepreneurship and social enterprises (SE), infrastructure for the technology, media and telecommunications (TMT) and other key sectors, and the conditions required to move these key sectors towards a digital economy.
Value-driven ecosystems need to be developed and relevant infrastructure built to mobilize entrepreneurial innovation and move TMT and other key sectors towards a digital economy. The governments have to address the unfavourable business environment and remove complex, demanding, and expensive business processes in order to support the region’s SMEs and to attract innovation to the region.
Sources of innovation in key sectors should be identified and programs designed to attract innovative companies and the global talent to the region.
This would accelerate transition to the new digital economy and enable circular migration as a response to the region’s emigration of skilled workers (“brain drain”). Youth, women, and social entrepreneurship need to be strongly promoted and regional ecosystems developed to support the region’s innovative startups and SMEs in key sectors. This includes incorporating the process of digital transformation, entrepreneurial learning and corresponding skills in the formal education of young women and men. Successful proliferation of innovative startups, SMEs and SEs would help move the CEE region toward the digital frontier.
Steering the regional economies towards the digital frontier requires new sources of intelligent capital and patient financing for the region’s SMEs and SEs.
The existing equity gap needs to be addressed to remove the barriers that hinder the region’s SME growth and innovation. New and impact intermediaries have to be developed to offer early-stage financing to the region’s SMEs and SEs. The region requires new financial instruments to provide guarantees, debt and equity, and to reduce transactional costs of investing into the SME sector.
The region’s governments, businesses and institutions do require the European partnership to achieve these goals. The partnership should transpose Europe’s own efforts to overcome the challenges its member countries are facing in their own efforts to reach the digital frontier. A good place to start is by removing all contingencies and eligibility constraints to avail all CEE countries, regardless of their EU membership status, a full access to the funds, instruments, and the toolbox available to the member countries’ SMEs and intermediaries.
Should it miss out on this opportunity, the CEE region would see the innovation and digitalization gap widen, leaving it behind as a “second grade” region with a high rate of migration of highly skilled experts. Working together, however, towards building a coherent strategy to reach the digital frontier will enable the CEE region to “plug” its economies into the EU’s Digital Single Market and reach its full potential to create new jobs, introduce new skills, enable new growth, and join the mainstream in the EU and on the global stage.
This is an abstract. The full text of this Article is available at: https://t.co/t9hmBO1C8D