Finance

Digitalization could boost Spain’s GDP by $48.5bn, report says

Spain could increase its GDP by $48.5 billion, an additional 3.6 percent, by 2021, according to a report by Mobile World Capital Barcelona and Accenture Strategy called ‘Opportunity of the Digital Economy in Spain: How digitalization can speed up the Spanish economy’.

Findings of the study, which analyzed the state of digital transformation in Spain and its opportunities for improvement, was presented at the 31st Meeting of Telecommunications and Digital Economy held in the Spanish city of Santander, on September 6.

The report’s analysis was based on the results of an index measuring the digital economy opportunity (DEO) established jointly by Accenture and Oxford Economics. The methodology is based on the assessment of three main influencers under which the digital transformation process is developed: digital talent, digital technologies and digital accelerators.

Digital talent measures the degree of digitalization of work and the skills and knowledge required to carry out specific jobs; while digital technologies refers to the production assets available to tackle the digital transformation processes; and digital accelerators refers to measuring the behavior of a series of factors in the environment that contribute towards the development of the digital economy.

Analysis of the three areas places the United States and United Kingdom economies as digital leaders, whereas Spain stands below the digitalization average in relation to its European competitors. This position, however, reflects the country’s future growth and improvement potential, as well as the aspects on which greater emphasis must be placed to speed up the economy’s transformation process.

The major impact of the 2008 crisis, which had a direct effect on the three indicators analyzed in the report, is one of the many reasons that have led to the slowing down of the digitalization index of the Spanish economy, which has grown below the remaining economies analyzed during the same period. The report highlights the reasons for this delay through the three influences forming the analytical framework of the digital economy.

The scarcity of digital talent is one of the main causes of the delay in terms of digital skills, the report says. The digital transformation process requires a high density of digital talent, although the supply at present in Spain does not meet the current demand for this knowledge. The traditionally low salaries of the ITC sector, youth unemployment (leading to low penetration of millennials in the employment market) and low demographic mobility are just some of the reasons for this lack of talent.

In terms of digital technologies, the lack of digital strategy and the uncertainty with regard to the profitability of new technologies and the operational complexity of Spanish businesses are restricting digital transformation, the report says. What’s more, investment in innovation and the technology transfer capacity from research centers and universities to the market is lower than those of other European economies.

The regulatory framework and the limited access to funding are other factors that have helped in the delay of Spanish digitalization in terms of the last influence of the DEO index: digital accelerators. The study, however, includes a series of recommendations to optimize the distribution of efforts over the three areas of the digital economy in order to maximize the impact and financial return on the country’s economy.

Spain is faced with a great opportunity for the growth of its economy, which includes defining an ambitious, large-scale digital strategy, according to the report. Changes in training include the rapid growth of professional re-qualification, new work models and new talent. In terms of technological resources, the focus is placed on investment in infrastructures, the deployment of high-impact technologies such as 5G, the promoting of private R&D through public policies and the encouragement of new forms of collaboration, including startups, SMEs and major corporations such as Corporate Venturing.

Lastly, the report indicates initiatives required to face the growth opportunity of GDP, such as tax incentive policies, adaptation of regulations to decrease barriers to access technologies, an increase in data security and protection, adaptation of schools in terms of infrastructures and curriculum, and the surge of innovation centers.