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Over the last few years, significant progress has been made in the field of digitalization and new technologies. The development of digital technologies covers many areas of modern life, from education and employment to the social security system and the impact on public administration. Digital tools ensure transparency of government and more efficient e-government, promote economic growth, production and exports, by increasing the productivity of existing industries and creating fundamentally new areas of the digital economy with increased added value. Digitalization also simplifies the conditions for business development, attracts investment, and provides greater opportunities to meet customers’ interests and for customer protection.

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E-commerce

Telecommunications

Trust Services

That is why digitalization is seen as an important element of sustainable economic and societal development, and technologies such as the Internet of Things (IoT), cloud technology, electronic identification (eID), and artificial intelligence (AI) can help achieve the United Nations Global Sustainable Development Goals.

Technological changes are happening fast. This requires quality and timely response, including the adaptation of legislative and regulatory fields. The European Union and other developed countries are not only declaring support for the development of the digital space but are also taking practical steps in this direction.

The EU’s approach to digital transformation means empowering and engaging every citizen, building the capacity of every business, and addressing global challenges, and is provided for in framework and strategic documents such as Digital Single Market Strategy for Europe, Connectivity for a European Gigabit Society, the recently developed Digital Europe 2025 strategy and the Program for the Development of European Standards in Telecommunications and Digital Technologies, etc.

The EU Digital Single Market Strategy was proposed by the European Commission in 2015 in order to achieve synergies between EU countries in the field of new technologies, cross-border trade, and the provision of services within the Digital Single Market (DSM). The strategy aims to enable Europe’s economy, industry, and society to reap the full benefits of the new digital age. The EU is actively creating a free and secure DSM where people can communicate safely, shop online without borders, and businesses can sell their products/services through e-commerce tools across the EU. That is, the DSM offers enhanced opportunities for users, small and medium-sized enterprises, innovative startups, the creative sector, science and security cooperation in addition to modernizing existing industries.

The main goal of the EU Digital Single Market is to remove unnecessary regulatory barriers and move from separate national markets to a single one, with pan-European uniform rules in the three sectors of Telecommunications, Trust Services, and E-Commerce.

The important components in the development of the EU Digital Single Market are:

  • Development of telecommunications infrastructure, which is the basis for the development of the digital market and digital economy, including the introduction of next-generation technologies (deployment of 5G networks designed to provide access to high-speed Internet not only at the level of citizens but also entire cities, sectors of the economy and industry important for sustainable development (such as energy, ecology, health, inclusion, transport, smart cities, water quality control);
  • Introduction and dissemination of trust services and remote identification (eID) tools, legally valid exchange of contracts and other documents;
  • Creating the preconditions for the development of cross-border e-commerce systems and e-commerce consumers protection across Europe.

The creation of the DSM has been an integral part of the Digital Agenda for Europe 2020, which has been adopted to deliver sustainable economic and social benefits through high-speed and ultra-high-speed internet and multi-purpose applications. These components are also key to the concept of creating a Gigabit Society by 2025 and Digital Europe 2025. Both provide for a gigabit connection for all major social and economic facilities, such as schools, transport hubs, public service providers, and enterprises that use digital technologies intensively, the deployment of uninterrupted 5G coverage for all cities and major land transport routes, expanding opportunities for free Wi-Fi access for citizens, further development of competition and protection of the rights of digital market actors, including on the basis of the new European Code of Electronic Communications, adopted by the EU in December 2018.

The EU’s Digital Single Market strategy was also extended by the Communication “Shaping Europe’s Digital Future” (2020). The EU has set itself the goal of becoming a global role model for the global digital economy, as well as supporting countries on the path to responsible and sustainable development. The development and implementation of pan-European standards and the coordination of efforts between EU Member States, their regions, society, and the private sector are key to achieving sustainable development goals, EU’s digital and technological leadership. This plan, among other things, provides opportunities for development in neighboring countries.

Thus, it should be noted that the EU pursues a comprehensive policy in the field of the digital economy and digital transformation, creating an entire ecosystem. Therefore, it is important and necessary for Ukraine to develop policies coordinated with the EU, taking into account strategic documents, EU acts, and declared goals as a whole, rather than in isolation from each other. After all, considering and implementing policies selectively, based on a set of fragmented systems, it is impossible to ensure the cumulative effect of increasing quality and quantity while reducing costs. An important element of this comprehensive policy is the establishment of clear key performance indicators (KPI) to be achieved and monitoring systems of their achievement and/or deviation from planned.

This approach, in particular, allows for responsible policy adjustments, identification of areas/indicators that need additional attention/investment/funding, and helps to address emerging challenges (e.g. COVID-19). It is important to support independent tools for monitoring the implementation of digital transformation and economic competitiveness programs, such as the Digital Economy and Society Index (DESI), which allows investors and international partners to track each EU member state’s progress in the development of the digital economy and society.

Ukraine, as one of the EU’s largest neighbors, can be an important partner contributing to the growth of the European digital market.

Moreover, Ukraine clearly states its intention to integrate into the EU’s DSM. The country identifies this intention as one of the key priorities and tasks, achieved through the implementation of the Association Agreement and Annex XVII-3, which contains provisions on harmonization in the field of telecommunications, frequency surveillance, trust services, e-commerce, IT services, audiovisual media, copyright and related rights and personal data protection. In view of the above, it is important to analyze the state of implementation of Ukraine’s commitments under Annex XVII-3 and identify the main ways and measures to be taken to ensure the development of the digital economy in Ukraine and accession to the EU’s DSM.

 

The research was prepared with the support of the European Union and the International Renaissance Foundation under the grant component of the EU4USociety project. The research reflects the position of the authors and does not necessarily reflect the position of the International Renaissance Foundation and the European Union.