The Hungarian Presidency: Towards a united European Digital Powerhouse

On July 1, 2024 shortly after the European Elections, Hungary will take over the rotating presidency of the Council of the European Union. As the EU institutions will be reset, posts redistributed, and the next European Commission appointed, Hungary has a key role to play in ensuring a steady transition.

Cecilia Bonefeld-Dahl, Director-General of DIGITALEUROPE said at the IVSZ SMART conference and the following international Summit for Europe’s National Trade Associations:

“The newly established institutions must continue to strive to create a single market, maintain economic security, develop critical technologies, and strengthen resilience”.

Dr. Balázs Vinnai, President of IVSZ said:

“Business perspectives need to be integrated with regulations in more depth. We believe that finding the right balance between regulating and letting the tech industry flourish is crucial to creating a European economy that supports innovation and can grow into the most significant player in the world.”

On April 18-19, 2024, members of DIGITALEUROPE, Europe’s leading industry association representing the digital economy, met in Budapest, including the IVSZ – Hungarian Association of Digital Companies, to discuss together with government representatives how to promote the following important issues during the Hungarian presidency.

One market, one set of rules

As the legislative cycle draws to an end, it’s crucial to prioritise the removal of barriers that currently hinder companies looking to scale across Europe. The digital sector faces significant challenges due to overregulation, which discourages innovators who confront a patchwork of inconsistent digital rules and standards along national and regional lines. Innovators are increasingly relocating to more favourable environments as a result. Moreover, there is a pressing need to address overlaps with other sectoral regulations to revive the 30-year single market marriage. Our recent report offers a set of actions to get there. Additionally, the issue of member states implementing unilateral legislative actions in areas already regulated by the EU deepens fragmentation and undermines the uniformity and efficiency of digital trade within the Union.

Economic security and critical tech:

Europe must have access to and be a creator of critical technologies. Right now, Europe has very few standard-setting tech companies left: This is a common problem we must address now. We therefore need an approach to economic security founded on the competitiveness of Europe’s digital industries, working with likeminded international partners as much as possible.

We should avoid the temptation to reach for too many protective tools and look instead to strengthen our greatest assets – our people and our single market. Innovation and incentives are needed to ensure technology companies stay and scale in Europe. Each critical technology needs a tailored analysis on EU strengths and weaknesses. A one-size-fits-all approach cannot be the solution when addressing technologies with different opportunities & risks, and at different stages of development.

Resilience & Defence: 

A resilient Europe depends on our ability to develop and scale critical technologies. Today digital is defining the battlefield. Now armed with the European Defence Industrial Strategy (EDIS), developing the defence industry will be a priority for Hungary. The presidency should focus on streamlining procurement and focusing on better coordination, faster processes and simpler rules will attract the diverse tech players we need to protect us on land, sea, air, in space and cyberspace.

Transition to the New Institutions

With the June 2024 elections heralding a fresh mandate for Europe, Hungary’s presidency is an opportunity to evaluate the Union’s progress towards Digital Decade targets and recalibrate our strategies for the digital age. It is imperative that we let the dust settle, take stock of new regulatory landscape and, honestly assess its efficacy in economies across member states and take steps from there. Let’s make sure the next European term kicks off on the right foot.

As advocates for Europe’s digital transformation, we call upon the Hungarian Presidency to champion these priorities while serving as a safe pair of hands through to the next European mandate. The key will be the single market. If we can unlock the power of a truly digital, single market, we can position Europe as a global leader in the digital age.