Year LXI, 2019, Single Issue, Page 72

 

 

NEW TECHNOLOGIES, GLOBALISATION
AND EUROPE’S POST-2020 FUTURE

 

 

The “Global Trends” report[1] presented before the European Parliament on April 8th 2019 highlights the main mega-trends that will need to be addressed when formulating the EU’s political-strategic objectives for the coming years. Alongside issues relating to climate change, demographics and urbanisation, a particular focus will be the impact of new technologies both on the globalised economy and on international relations within a rapidly changing geopolitical scenario.

The “fourth industrial revolution” is now under way: its unfolding is radically changing the world as we knew it in the last century, and its consequences are set to affect upcoming economic, social and political trends, as well as the evolution of international relations.

These opening remarks prompt a series of questions: What is happening? What are the new scenarios? Who are the main competitors in the era of globalisation? What is Europe’s role?
 

The Changing Face of Production, the Economy and the Working World.

All these developments stem from the rapid transformation of the world of production, which is being shaped by the need to acquire and exploit new technologies, digitalisation processes and robots, in order to boost competitiveness, churn out huge quantities of high-quality products in record time, and eradicate human error.

There is no competitive manufacturing industry on the international markets that has not innovated and that does not exploit, as strengths, “Industry 4.0” technologies (i.e. new production technologies used, in a context of industrial automation, to improve working conditions, create new business models and increase the productivity of plants as well as the quality of what they produce) and collaborative robots (“cobots”). We now talk of “smart factories” where every aspect and area is interconnected: the design department, warehouse and production line, testing, customer management, product shipment, safety and security — all this in order to boost efficacy, cut waste and material stocks to the bare minimum, and increase flexibility and product customisation.

As shown by data referring to the past couple of years, research and innovation companies operating within the field of IT and technological/digital engineering have started to dominate the classification of the world’s top 10 most highly capitalised companies on the international markets.

In 2017, the “top ten” companies were: 1) ExxonMobil (hydrocarbons); 2) General Electric (conglomerate activities); 3) Microsoft (information technology); 4) Fitigroup (financial services); 5) AT&T (telecommunications); 6) Bank of America (banking/financial services), all USA concerns; 7) Toyota Motor (automotive sector), Japan; 8) Gazprom (hydrocarbons), Russia; 9) PetroChina (hydrocarbons), China; 10) Shell (hydrocarbons), The Netherlands.

In 2018, however, the ranking looked very different: 1) Apple (information technology); 2) Amazon.com (information technology); 3) Alphabel (information technology); 4) Microsoft (information technology); 5) Facebook (information technology), all USA; 6) Alibaba (information technology), China; 7) Berkshire Hathaway (banking/financial services), USA; 8) Tencent (information technology), China; 9) JPMorgan Chase (banking/financial services) USA; 10) ExxonMobil (hydrocarbons), USA.[2]

The dawn of this fourth industrial revolution is bringing developments that are revolutionising society, the labour market and the working world, sometimes with traumatic effects.

Nowadays, it is difficult for young people to say what job they expect to be doing in 20 years’ time. Faced with this question, there are, however, three things they should certainly take into account: first, that they will cover at least two or three different roles in that space of time; second, that many of the jobs they might occupy in the future do not even exist yet, while some of today’s jobs and professions are destined to die out; and third, that adaptability will be the key, given that everything in the global market and the technology market is changing all the time.
 

The International Struggle for Technology Dominance.

Cyberspace, the virtual environment of interconnected communications and information systems, is a new man-made, “non-natural” domain that transcends natural boundaries.

Also known as the “cybernetic domain”, it has joined the traditional domains of Earth, Sea, Sky and Space as a new sphere of human action, and its importance is increasing exponentially.

Digital technologies, as a result of today’s increasingly widespread and pervasive digitalisation processes, are now ubiquitous. Accordingly, they are assuming considerable strategic importance within an international system that, in recent years, has completely altered the global scenario that became established in the wake of WWII — a scenario that was, for many years, characterised economically and militarily by a sort of balance between the victorious powers, and by a marginalisation of Asian and Third World countries.

The fact is that the phenomena now emerging and developing within the context of commercial competition can be seen as a new front within the “old” quest for global hegemony. The aim of those engaging in this competition for and pursuit of technological hegemony is to identify and manage, to their own advantage, the myriad digital opportunities/vulnerabilities that characterise both daily life and the most technologically advanced environments.

The 21st century struggle between the USA and China, in which Russia also insinuating itself (for now, through cyber meddling with the West), already concerns the domain of technologies based on artificial intelligence, and this will become its focus more and more in the future.

Over the past two/three years, Beijing, seeking to challenge America’s global dominance, has invested heavily in these sectors, which include 5G, big data and robotics. The “Huawei affair” (the arrest in Canada, on Washington’s orders, of the daughter of the Chinese tech giant’s founder) officially marked the start of the 21st century’s “technological Cold War” (dubbed Cold War 2.0).

On a more general level, this conflict between Beijing and Washington will affect the links between the economy and national security and, like the USA-Russia Cold War of the last century, it will end up fueling a competition between the two superpowers’ respective spheres of influence. It is no coincidence that the countries, after Canada, that are most closely linked to the USA through intelligence agreements have all excluded Huawei from their domestic markets in the sensitive industrial 5G sectors (I refer to the UK, Australia and New Zealand, which, together with Canada and the USA, form the so-called Five Eyes alliance).

The issues at stake here are not only of a commercial nature, but also relate to “security” and future “geopolitical balances”.

This 21st century struggle will also affect political systems and the internal balances of contemporary societies: according to Foreign Affairs, just as the Cold War of the 20th century was based on the ideological differences between capitalism and communism, the Cold War 2.0 will be fought between liberal democracy (made more vulnerable by technological competition) and a new form of “digital authoritarianism”.
 

Technological Competition: the (Current) Protagonists.

The geo-economic and international political stage is currently dominated by two aggressive protagonists: the USA and China. Other players are Russia and the EU, the latter harbouring interesting but as yet untapped potential.

The USA, thanks to its high level of private investment and lively academic ecosystem, continues to maintain its clear leadership in the field of artificial intelligence.

China, currently engaged in a rapid and massive military modernisation effort, is aiming to catch up within the next decade or so, by making this area a new focus of public investment and research.

Russia, lacking the means of the other two powers and thus apparently sidelined, for the moment can only play its hand through cyber meddling with the West.

Europe, meanwhile, is lagging behind and struggling. In theory, the EU certainly has its own strengths to exploit, such its prominence in scientific research and vast digital market, but unless it invests significant resources in artificial intelligence technologies and creates a high-tech industrial capacity truly able to compete at global level, Europe is destined to remain crushed by the weight of the main competitors: the USA and China.

It is worth remembering that Europe is the most attractive market for tech products, be they produced in the USA or in China. Why? First, because Europe, with its 500 million plus “consumers” and over 23 million businesses, is the world’s largest economic area in which goods and people can move freely. Second, because it generates 35 per cent of total world exports of goods and services and 20 per cent of manufacturing added value, while accounting for 50 per cent of global welfare spending. Third, because 18 of the 20 countries most deeply integrated into global markets are EU member states.[3]

Therefore, the EU, if it values its sovereignty, needs quickly to recover a role as co-protagonist and become capable of autonomously controlling the key technologies that affect growth in the most advanced sectors; “controlling” these technologies means possessing and developing them, and maintaining them over time, which is to say providing and preserving them.

Germany and France are both well aware of this need, as shown by their joint signing, on January 22nd 2019, of the “Aachen Treaty” in which they promised to “promote ethical guidelines for new technologies at the international level”.

Thanks in part to this Treaty, but also because of concerns over the escalating “competition” between the USA and China, as well as apprehension arising from China’s stepped up efforts (within its new “Silk Road” project) to enter into bilateral agreements with European countries, the European Commission, at the start of April, took the initiative of presenting, on the basis of the more than 500 contributions submitted to Brussels by the different sectors involved, a set of guidelines, or recommendations, on artificial intelligence.[4]

These list 7 key requirements of artificial intelligence, all of which revolve around humans (editor’s note: “humanism” is an intrinsic and specific value of European culture):

  1. There must always be human supervision, given that the aim is to improve human action/intervention, not undermine human autonomy;
  2. Algorithms must be secure, reliable and resistant to errors or inconsistencies in the various phases of artificial intelligence system life cycles;
  3. Citizens must always be informed about the use of their personal data and given full control of the same so that they are not used against them, and this must be done in line with the EU data protection rules contained in the GDPR;
  4. Transparency must be guaranteed, by ensuring the traceability of artificial intelligence systems;
  5. Diversity and non-discrimination must be guaranteed, and human beings, taking into account all the necessary factors, must be enabled to modify the decisions of algorithms;
  6. Artificial intelligence must work to promote societal and environmental wellbeing, boosting environmental sustainability;
  7. There must exist forms of redress for those with grievances over algorithmic decisions, so as to ensure the accountability, in the event of damage or accidents, of those who manage the computer systems.

On June 7th 2019, the European Council, with the aim of “boosting digital and economic competitiveness across the Union and digital cohesion” adopted its Conclusions on the Future of a highly digitised Europe beyond 2020.[5]

These “conclusions highlight the main priorities and challenges for a strong, competitive, innovative and highly digitised Europe. They refer to the importance of supporting innovation and encouraging European key digital technologies, respecting ethical principles and values in artificial intelligence, strengthening Europe’s cybersecurity capacity, improving e-skills, and developing the gigabit society, including 5G. They also underline the need to increase the number of women in the sector and to enable all vulnerable groups to reap the benefits of digitalisation so that no one is left behind.”

This Commission initiative, and the resulting intervention of the Council of the European Union, both much needed, risk being undermined by the undisciplined behaviour of Europe’s sovereign states, which attach more importance to their own grandstanding stances, even at the cost of possibly placing their own countries in a position of subjugation to China or the USA.

For this reason, the situation remains urgent: to be effective, the aforementioned guidelines on artificial intelligence demand broader and more unified political support among the European countries.

Crucially, therefore, there must emerge a convergence of political will to support a reform that will give the EU self-determination and powers to adequately address the challenges set out in the Global Trends report.

In more simple terms, this means drawing up, without delay, an “agenda” for the future of Europeans that is designed to allow a rapid transition towards a “Europe with federal institutions”. This must be a post-national and federal European-wide project that, combining a vision with a coherent and incisive approach to governance, is capable of creating a new Europe able to deal authoritatively with the countries that would have it subjected to their economic, political and military dominance.

Globalisation (be it technological, financial or economic) is irreversible and unstoppable. However, it is still possible to attempt to influence it, and that is something the eurozone countries can do: their role is to work together to launch a “different globalisation” that hinges on and rewards the social values associated with an inclusive economy and inclusive development, and that respects the dignity of the person, the dignity of human work and environmental sustainability.

This is certainly an ambitious objective, but it continues to be attainable, providing President Macron’s weighty and heartfelt warning is heeded: The only way to ensure our future, is the rebuilding of a sovereign, united and democratic Europe”.

Piero Angelo Lazzari


[1] European Strategy and Policy Analysis System (ESPAS), Global trends 2030: Can the EU meet the challenges ahead?, https://ec.europa.eu/epsc/sites/epsc/files/espas-report-2015.pdf.

[2] Mario Deaglio, Il mondo cambia pelle? Milan, Guerini e Associati, 2018.

[3] Konjunkturforschungsstelle (KOF), ETH Zürich, Index of Globalization 2017, https://www.kof.ethz.ch/globalisation/.

[4] Independent High-Level Expert Group on Artificial Intelligence set up by the European Commission, Ethics guidelines for trustworthy AI, https://ec.europa.eu/digital-single-market/en/news/ethics-guidelines-trustworthy-ai.

[5] European Council, Boosting digital and economic competitiveness across the Union and digital cohesion, https://www.consilium.europa.eu/en/press/press-releases/2019/06/07/post-2020-digital-policy-council-adopts-conclusions/.

 

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