SMEs Offer Solutions to Many Problems Facing the V4
27 January 2023
Is it indispensable to be technologically sovereign as a country or a region? While Central and Eastern Europe countries may not have the potential to be self-sufficient on global or even European markets, they play a role as part of the EU’s struggle to be digitally sovereign.
There are technological corporations much stronger in the present-day era than the British East India Company, and most countries ever were in the past. As a result, there is no possibility of achieving digital sovereignty alone.
No CEE regional partnerships can resist the influence of big technological corporations without building strong cooperation within the European Union.
But let us take a closer look at how governments and regional alliances are approaching this topic for us to understand the actual state of play, including examples of authorities’ narratives and their more practical consequences. We should also see whether there is such a thing as regional unity and cooperation on this issue.
If sovereignty is a buzzword loudly heard in narratives painted by the governments of several Central and Eastern European countries, then technological sovereignty sounds like the ‘new blockchain’.
It is hardly possible to understand what technological sovereignty is; we know it may be useful and important. Still, apart from talking about it, it is difficult to find good and practical examples of usage or how to make a profit from it. As with the blockchain, technological sovereignty is possible only for a limited number of companies, countries or regions.
To comprehend the importance of the latest buzz, we should first agree on what is technological sovereignty in the first place. As we can read in an interesting piece by Matthias Bauer and Fredrik Erixon from the European Center for International Political Economy, “for some, it is mostly about economic strategy, while others view technology sovereignty through the lenses of values, history, or international public law.”
From a more technical perspective, as phrased by the Fraunhofer Institute For Systems And Innovation Research, “technology sovereignty is the ability of a state or a federation of states to provide the technologies it deems critical for its welfare, competitiveness (…) and to be able to develop these or source them from other economic areas without one-sided structural dependency.”
Also, sociologist and defence expert Andrzej Zybertowicz, who is closely associated with the current Polish government, notes that “it would be best if sensitive solutions were created by Polish specialists or with their participation. We should use solutions over which we will have full control. Not only functionally, but also in the supply chain of necessary elements.”
The question is if the ‘best’ may occur in practice. Especially if some of the political actors in the region may understand digital sovereignty as limited to being a leader in creating technology.
For example, take a look at strategic documents on the development of artificial intelligence (AI) in the widely understood CEE countries. They quite well reflect the way their governments understand their role in the global digital market both politically and economically.
Although, too often in an overenthusiastic way. In the National Artificial Intelligence Strategy of the Czech Republic, the government “has committed itself to become one of Europe’s innovative leaders and a country of the technological future within twelve years”.
Authors of the recently adopted Policy for the Development of Artificial Intelligence in Poland, from 2020, claim that the country has “the potential to make a dynamic transition from being a contender to an internationally recognised leader in AI”.
Thankfully, the actual authors of both documents accepted on subsequent pages that this is impossible without external support and cooperation with the EU. But as part of the rhetoric recently popular in both countries, this pompous discourse should please their leaders.
In comparison, Russia has worded its understanding of technological sovereignty much more clearly in their AI Strategy: It is about “ensuring the required level of independence of the Russian Federation in the field of artificial intelligence, including through the predominant use of domestic artificial intelligence technologies and technological solutions developed on the basis of artificial intelligence.”
Interestingly enough, It is worth noting that Russia, apart from serious cybersecurity concerns, is not widely considered as a country that can compete in the digital area with the likes of the EU, China or the United States.
Like the Chinese government, Vladimir Putin is currently trying to create absolute digital sovereignty. In 2019, he introduced the legal framework for creating an independent Russian Internet. Later that year, he claimed that it was successfully tested in practice.
Whichever way Russian authorities will choose in the future, it is unlikely that their imperialistic appetite would allow them to get involved with the collaboration of other CEE countries based on the rules of mutual partnership in the field. Nor will Russia that can successfully compete on the global digital market.
There are examples of more reasonable partnerships, contrary to a purely autarchic struggle to maintain digital sovereignty in the region. In 2017, the prime ministers of the Visegrad Group countries announced the Joint Declaration of Intent on Mutual Cooperation in Innovation and Digital Affairs.
They emphasised the “need to coordinate actions aimed at boosting competitiveness, innovativeness, and digital transformation of V4 countries and to coordinate positions in the EU”. Although this declaration had more of a political character, two years later a number of IT sector employers’ organisations from V4 countries issued an even more radical statement.
Unlike the 2017 Declaration, which mostly consisted of appreciation for the development of EU policies in terms of the Digital Single Market and cybersecurity measures, representatives of the industry treat the V4 countries as much stronger players, who should “stand a chance to compete against both Europe and global giants such as the United States of America and Asian markets.”
It is impossible to judge how conscious the decision of treating the rest of Europe as the competition was, but it was definitely consequential.
One year later, this time a broader set of IT sector organisations comprising those active in the Three Seas Initiative countries, adopted the Warsaw Digital Declaration. In the preamble, they have explicitly stated that “from the point of view of our countries’ economies, it is crucial that all know-how and ready-made, valuable products are created here and only in this way we have a chance to become a globally competitive market”.
This part of the preamble sounds a bit naive if we take into account that Hungary, which is a member of both regional initiatives, has not followed the others (and the EU) in cutting off China from building 5G infrastructure – so crucial for digital development.
On the contrary, Poland is amending the public procurement law to be able not to let Chinese companies construct and maintain this network standard on its territory.
Moreover, the Czech Republic is an open critic of allowing China to directly influence its digital ecosystem, followed by Slovenia, which also asked the American government for support in defending their market against China.
As much as there can be scepticism about the authorities’ standpoint on building national or regional sovereignty, the IT sector has a bigger potential to achieve some of these goals.
It is not surprising that money can make us fly high. But not enough to reach the peak.
The term cloud computing is connected not only with the way the data are being stored but is also a cornerstone on which the modern digital ecosystem depends. Data is the new oil, as some would say. Less enthusiastic persons would rather call data a new type of asbestos.
While we cannot preempt who is right, we have to agree that there is no technological independence without data sovereignty. Using colloquial language, data are feeding digital services of all kinds, from virtual maps, through social media platforms, up to the most complex artificial intelligence solutions.
For this reason, data storage is also an important part of the EU data protection and digital market frameworks. CEE countries are aware of it too.
In 2018, two state-owned Polish companies set up a project called the State Cloud which meant to provide cloud computing services for the Polish market, with ambitions to enlarge the scale in the whole CEE region. It is a reasonable solution but it ended up with US-based companies Microsoft and Google being the main operators of the system.
While there is a chance to limit the influence of other states in CEE, it seems to be impossible to remain sovereign from monopolistic US technology companies. To reduce the dependence of European entities on American or Chinese providers of cloud computing services France, Germany and multiple EU companies have set up the project Gaia-x which is supposed to be a part of the EU striving to achieve its technological sovereignty.
Rather sooner than later, regional initiatives will integrate with this or similar projects.
Whether it is individual European studies, regions as the V4 or initiatives like the Three Seas, all of these are just too weak to compete with big players on the global market. If they do not choose to act arm in arm with the EU, they are condemned to be influenced by China or even the United States.
The only way to achieve a reasonable level of digital sovereignty (as European nations) is to achieve this within the EU. However, with all ambitions of illiberal and liberal democracies across Europe, it will not be easy.
There is a lot of truth in Virginia Tech Professor Mariusz Orłowski’s bitter observation that “In the global technological race, Europe is ‘blocked’ by the fragmentation into nation-states – the European Union seems to be an assemblage of states vying ever more clearly for their narrow national interests.”
Apart from Viktor Orbán keeping his eyes on China, an excellent but daunting example is the approach taken by the Polish government: it objected to a reference to gender equality in the Council presidency conclusions on how to guarantee that artificial intelligence complies with the EU’s Charter of Fundamental Rights.
The big part of the EU’s sovereignty lies in its values, which are also the foundation of all its digital policies on personal data protection, a human-centric approach in AI or anti-trust policies to crush the biggest technological companies’ overwhelming powers.
At the same time, the ‘old EU’ seems to see our region as an American Trojan horse and treat it with caution and look at them with a sense of superiority.
The CEE countries have an important role in building European digital sovereignty, and it should be probably more appreciated by the EU institutions and countries such as Germany and France in this regard. If both sides have an appetite for technological independence, there is no other way but to sit and negotiate at the same table.
As M. Bauer and F. Erixon wrote in the above-cited piece, “it is critical for Europe’s ability to shape its own technological future that European policy-makers cooperate with others.”
If this effort will be awarded is an entirely different discussion and depends on the EU’s capacity to regulate its market and build a synergic European digital ecosystem.
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