The Central and Eastern Europe (CEE) region is lagging behind in creating the building blocks and infrastructure for a successful digital economy. Even though some countries have made advances in public (e-government) and private sector projects, significant efforts and resources are required to address and improve taxation, financing, labour, social, education and innovation support systems to prepare for the digital economy. Perhaps the greatest obstacle to the digital efforts in the wide CEE region is a lack of cooperation and fragmented relationships between and within the countries and a lack of efficient public-private partnerships in key sectors.
These building blocks should include development of ecosystems in the CEE region to support innovation and entrepreneurship, as well as the required infrastructure such as transport links, telecommunication infrastructure, and better regulations. This transformation should aim to mobilize innovation and entrepreneurship for the digital economy, but also deliver more transparent, stronger and accountable governments and public institutions trusted by the public.
Sources of innovation in key sectors should be identified and programs designed to attract innovative companies and their 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;
A profound change in the teaching methods and daily practices of educational organisations is required — the governments need to partner in promoting peer learning and the exchange of good practices, fostering a strong entrepreneurial mindset. Opening up the learning environments to the key sectors of digital economy (e.g. PPP between universities and SMEs) and adopting learning-by-doing curricula allows us to foster entrepreneurial and innovation-oriented mindset. This requires a greater investment in the education sector to not just train people for the new jobs, but retain talent in the region once it is developed.
Financing the digitization efforts is a true regional challenge and one clearly best undertaken as a joint consideration with a sizeable support extended by the EU funds, instruments and the toolbox currently available to the EU member countries.
The prospect and potential of the digital economy promise large benefits for the region. The optimal approach for the digital transformation of the CEE region is to follow the EU member countries experience in building the optimal infrastructure and securing greater transparency and data access to its citizens.
The region’s ability to reach the digital frontier will depend on navigating and transitioning towards new models of production and innovation. A continued European commitment to the region should, inter alia, transpose Europe’s own efforts to overcome the challenges faced by the member countries in their own efforts to reach the digital frontier.
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MIF Ventures is an impact-focused investment firm whose goal is to combine top-tier environmental, social, and financial returns. Manages MIF II Impact Venture Fund that provides intelligent capital to impact-driven SMEs and social enterprises to help them accelerate their product roadmap, scale globally and improve targeting social issues to deliver better outcomes.
This story has been developed with Mozaik Foundation.