The European Commission’s Digital Economy & Society Index (DESI) examines the evolution of EU countries towards a digital economy and society. Objective: allowing member states to identify their strengths and weaknesses, as well as the domains in need of priority investments. With a total score of 59.0, Luxembourg ranks 8th out of 27 EU Member States. The 2021 edition of the index emphasises in particular Luxembourg's progress in digital public services for businesses.
Connectivity remains Luxembourg’s forte
The DESI is a compound index, structured in four interdependent and weighted components:
- Human capital (6th): basic digital skills, IT specialists, ICT graduates…
- Connectivity (4th): broadband coverage, 4G coverage, 5G readiness…
- Integration of digital technology (14th): e-commerce, cloud, big data…
- Digital public services (11th): e-Government users, digital public services for businesses, Open Data…
In many of these areas, Luxembourg is leading, together with other well-known innovators in the field, i.e. Ireland, Malta and the Baltic states.
As far as human capital is concerned, Luxembourg gains two ranks, compared to the 2020 edition, and settles in 6th place. According to the DESI 2021, the Grand Duchy’s population is above average with regards to digital literacy and the share of ICT specialists as a percentage of the total employment. On the downside, the European Commission notes that the country still struggles with significant shortages in terms of ICT specialists.
Connectivity remains Luxembourg’s forte. Even though Luxembourg loses one place and comes in 4th, the country is 2nd for Very High Capacity Network (VHCN) coverage. The Commission also emphasises the high coverage for Next Generation Broadband (NGA) and the fact that over 90% of the country is covered by broadband. The Commission thus judges that Luxembourg is well on track to meet the EU broadband targets.
Rapidly developing digital public services
As for the degree of integration of digital technology by businesses, Luxembourg has managed to pull back and gain five ranks in one year, coming in 14th place. Luxembourg has made major progress in the uptake of digital innovation. In particular, it performs well on the share of companies that analyse big data, a throwback from the country’s engagement in the Euro High Performance Computing (EuroHPC) initiative. By contrast, Luxembourg continues to perform well below the EU average on the share of SMEs selling online, with only 9% compared to the EU average of 17%.
Finally, regarding digital public services, Luxembourg has been improving its score for three consecutive years, jumping from 18th (2018) to 11th (2021), with a score of 79.4. The EU Commission particularly highlights Luxembourg’s performances in the provision of digital public services to businesses, scoring 97 out of 100. On the other hand, the authors still see room for improvement on the level of online interaction between public authorities and citizens, with an average proportion of 64% of internet users engaging with e-Government services.
The improvement of daily life at the heart of the technological development
These results perfectly reflect Luxembourg’s recent efforts and investments in becoming a key player in the digital sector. The government programme, presented in December of 2018, expresses the desire to place digitalisation at the centre of priorities. This is how, for the first time, a Ministry for Digitalisation was created, with the goal of advancing the technological development and new strategies, as well as improving the citizens' daily life and administrative procedures. Thus, the needs of the population are established at the core of the Luxembourg government’s efforts in digitalisation, e.g. through its artificial intelligence (AI) strategy, which greatly benefits from the Euro HPC initiative.
Furthermore, the Ministry of the Economy launched its Data-Driven Innovation Strategy in 2019, aiming to seize the latest digital technological developments to achieve the digital economy of tomorrow.
On a European level, Luxembourg signed the Declaration of European Blockchain Partnership and the Declaration on cooperation on Artificial Intelligence. In the field of supercomputing, Luxembourg is not only a founding member of the Euro High Performance Computing Joint Undertaking (EuroHPC JU), but also its headquarters. The newly purchased Luxembourg supercomputer Meluxina is another example of the Grand Duchy's actions in favour of a digital society.
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