This is the third in a series of articles by CEOs, chairs and other senior leaders of companies about the future of growth in Europe. These articles are published under the umbrella of Europe Delivers, a business partnership powered by Xynteo working to build future-fit growth in Europe.
I am pleased to be working with Hans Vestberg, Svein Tore Holsether, Jochen Thewes, Huibert Vigeveno, Henrik Henriksson, and Michael Miebach to share my thoughts on what Europe needs to do to play an even more progressive role in the world, during and after the pandemic.
Europe is like a second home to our group. Our first office in the region was established more than a hundred years ago. Today, the United Kingdom and Continental Europe account for the largest operations for our group outside of India, with over 19 of our group companies present across the region.
Set against this experience, the pandemic has shone a light on the key role Europe can play in shaping a better world as we emerge from this unprecedented shock to the global system. Just consider that of the 3987 clinical trials and studies on Covid-19, the largest number (37%) are in Europe. It also notably spearheaded a Global coronavirus response fund (raising €15.9 billion) to support the global deployment of breakthroughs in healthcare, testing and vaccines.
On the global stage Europe’s leadership is critical, in my view, given the region’s thrust towards peace and dialogue over strife, alongside a robust global economic motor; a commitment to democracy; and an instinct for consensus and collaboration as the best means of solving big, complex problems.
Above all, we need Europe’s capacity for innovation. I read with great interest the first installment of Europe Delivers´ series, in which Scania´s Henrik Henriksson reminded us that Europe includes a dozen of the world’s 20 most innovative economies.
I see three areas in which European innovation is a must:
First: Keeping the global marketplace open, while rebalancing supply chains
With a nominal GDP of US$20.43 trillion, Europe is the second largest economic region in the world and accounts for 24% of the world economy. As a dominant force in the global economic and trade system, Europe will face an unmistakably different world that emerges from this crisis, where it has to play an even more important role as a champion for an open, fair, rules based and free trading global economy.
The pandemic has been an expensive reminder of the cost of fragility in supply chains – medical supplies, most notably. But the answer is not a rush into economic nationalism. Let us protect openness (after all, innovation feeds on the exchange of people, goods and ideas), while rebalancing our supply chains, building what I call a proficiency for resilience.
Second: Bridgital - making technology work for people.
I am delighted that European Commission President Ursula von der Leyen and her team have identified digitalisation as a key plank in the EU´s strategic agenda for 2019-2024. Their success will depend to a large extent on whether society feels technology is working for and not against them.
In my book Bridgital Nation, I argue that tech has a serious people problem. Artificial intelligence and related technologies should be designed not to replace human activity but to augment it. We are seeing this take place throughout the pandemic response. I estimate that, in India, such a digital revolution could positively impact 30 million jobs by 2025 and increase wages by 10-20% while vastly improving citizen access to vital services. This stems from better understanding and designing for sectors that will see net jobs increase while undergoing digital transformation – here, the health sector is a good example.
Similarly, I believe that digital transformation remains the single largest future opportunity for Europe. It has already established itself as a standard-bearer in areas like privacy, however this must also be coupled with significant investment in digital infrastructure and skills training for job-seekers.
In the recently concluded India-EU Summit in July 2020 between the PM of India, Mr. Narendra Modi, and Presidents Mr. Charles Michel and Ms. Ursula von der Leyen, India was recognized as the natural digital partner to Europe and the two sides mooted a joint digital investments forum next year. This is a good step towards the need by both regions to revive growth in their economies.
Third: Taking sustainability ambition into everyday business.
I believe we have reached a tipping point in public insistence that governments and businesses create a cleaner global economy. Our development should not imitate the 20th century model. We need to find a new way to realise our potential. A sustainable way.
The moral imperative of this is clear, but there is an economic one, too. The Covid-19 crisis should inspire us to invest in R&D in future growth sectors – and there are few sectors more promising than renewable energy. Within two decades, nearly 20 new energy sources could be powering the global economy.
Among the major economies, the EU and its member states are ahead of the pack in the bid to build a climate-neutral economy. This leadership is on vibrant display in the Green Deal, which commits at least €1 trillion over the next decade to investment in sustainability, with the ambition of becoming the first continent to be Carbon Neutral by 2050.
The ambition is right, but our challenge now is to deliver – and to do so at pace, in what is a high-stakes race.
Notably, the world is suffering from a trust deficit at the moment.
We have seen collaboration take place in the scientific community, but far more could be done to create connections between the scientific community and other communities and across geographies. Once we get to a stage where more solutions are available, be it a vaccine, better patient care, on-demand rapid Covid-tests, there should be a much stronger global effort to deploy a truly global approach to eradicating the disease.
Europe’s leading voice on science, research, collaboration, global risk mitigation and data privacy, coupled with the region’s ability to come to pragmatic solutions are more important than ever.