Opinion

Innovation and digitalisation after COVID-19

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Twelve years after the global financial crisis, we are facing an unknown situation. An unprecedented tsunami has confined millions of people to their homes, rocked the stock markets, shut down businesses, markets, restaurants and streets, crippling our economies. Historical precedents reveal that such a situation could alter political and economic systems, reconfigure ideas and theories and impose radical changes on our way of life.

This time, the unexpected allies have been innovation and digital technology, which have helped to alleviate the impact of COVID-19 on individuals, businesses and governments. In the midst of the chaos, a new digital-based era is emerging, creating new opportunities. But the benefits of technology are not equally distributed, as more than 3.6 billion people on the planet still do not have access to the Internet. In the informal economy, teleworking does not exist. For millions of children, access to online education is a remote dream.

Now is the time to react in a coordinated way to the new challenges, because innovation and digitalisation are here to stay. Their implementation has accelerated and there is no turning back now. It has changed the way we work, learn, buy and interact. We must be prepared for the so-called new normality.

Never before has the digital agenda been so necessary and vital. It is not only an immediate response to the impact of COVID-19, it also makes it essential to boost research and innovation. The current economic models are out of breath because of the speed of change. We are in an era of globalisation, climate change, pandemics, digital transformation, collaborative economics, urban concentration and rural depopulation. There are many changes that governments are struggling to regulate. However, these also imply new divergences and polarisations between economies and societies. This is why new responses are needed. 

Technological change threatens jobs, but it also creates alternatives. Relations at work, between companies, employees, services, mobility - are evolving. The only key to progress is to improve innovation and education. As with everything else, the future of Europe, Africa and the Mediterranean lies in adapting, sharing experiences and moving forward together.

Following the current model, Mediterranean governments focus on job creation rather than on business creation. An outdated model that consists of launching massive public employment programmes instead of financing and investing in successful businesses that create jobs. It is clear that economic progress is directly related to training, research and innovation activities, and that there is a correlation between social progress and business activity.

The life cycle of enterprises must teach many countries that the secret of eternal youth is constant innovation. Governments need to balance expenditure and invest in tangible infrastructure, such as roads, railways or ports. However, they must also invest in intangibles such as education, research and development. R&D is the key driver for building and consolidating a knowledge economy and implementing a culture of creativity in which young people are inspired, transform their ideas, raise their ambitions and pursue their dreams.

Entrepreneurship and the private sector can drive adaptation to technology and innovation, be the vehicle for involving young people and moving forward. A new mindset, a new attitude, harnessing young energy, fresh ideas, must be encouraged, for it is these that bring opportunities. Innovation is a lever for adding value because it transforms the way we do business and has a multiplier effect on the growth of a nation and its companies. 
Innovation is the way to development and survival. The model for the rise of a company or country. Technology is already here, but on its own it is not the answer. It is an enabler and accelerator of new ways of being and doing. To be able to create wealth and ensure a future, innovation is not an option, it is a necessity.

The Mediterranean region will have to create hundreds of millions of new jobs over the next three decades. This challenge presents an opportunity for the region to transform its economies and harness the creativity of its large youth population and the disruptive power of technology to create wealth.

Whether we like it or not, production lines will require less and less labor through more efficient machines, automation and robotics. In addition, the next wave will bring more artificial intelligence, 3D printing and new capabilities that will make additional work redundant. We already know that 8 out of 10 jobs will be lost due to new technologies (not immigration or globalisation), that 64% of the jobs that exist today will be automated and that 66% of the jobs for the next 10 years have not yet been invented.

The transition to the fourth industrial revolution, combined with a crisis of governance, makes it imperative to thoroughly reconsider human capital and adapt education to the labour market in order to achieve prosperity and stability. New digital technologies are generating a new competitiveness that, for the time being, does not reach many Mediterranean countries. For the region, a successful transition would ensure business competitiveness and be a determining factor for regional industrial consolidation. Doing nothing risks having a negative impact on its future growth and productivity.

In this region, the most immediate economic challenge is not diversification or new tax regimes, but the creation of productive and sustainable jobs for its youth. At the same time, it must be equipped with the combination of talents and skills that will make industry 4.0 a generator of wealth and social peace. We must be concerned about the level of training of the workforce and its quantitative and qualitative nature. The factors that allow us to better evaluate it today are the development of the digital culture, the skills and the capacity to think creatively.

The region has enormous human capital to develop. Education, the promotion of the private sector and an understanding of this technological revolution will be key ingredients for success. This is a complex task that will require a broad social consensus and determined action by governments.

The digital potential is unlimited, which represents an opportunity for the Mediterranean. A large market with rapid growth. A hub of innovation, creativity and entrepreneurship. Young people have the resources to find solutions to pressing problems. Leaving the Mediterranean behind in the digital transformation is not an option. The pace of the fourth industrial revolution will wait for no one. As the United States and Asia move forward, Europe and the Mediterranean need to forge their own identity. Today the imbalance is obvious, and everything that prevents an improvement in innovative capacity is conditioning the future.

The main key to innovation is training. Companies that invest in their employees to provide them with the right knowledge are the ones that grow. Governments must do the same, improving qualifications and encouraging innovation in all key sectors of the economy and in the education system. If they stop investing in the education of the new generations, they would be condemning them to depend on others for life.

There is a great need for a new collaborative platform that brings together governments with business and other stakeholders in Mediterranean public-private cooperation, facilitating a progressive dialogue that understands and respects the values and culture of the region. Investment must be made in young people to unlock the demographic dividend in an area where the interests of governments, the private sector and international organisations are fully aligned. This requires joint action by all today to ensure a prosperous region tomorrow. 

This crisis will pass, but we must not forget that innovation and digitalisation are the path to survival and development, the fuel for constant progress and the model for the rise of a company, a nation or a region.