Remarks by Angel Gurría,
14 March 2017
Fundación Areces, Madrid, Spain
(As prepared for delivery)
It is a pleasure to be with you today at this seminar that will debate how to prepare the Spanish economy to face the opportunities and challenges posed by the new production and digital revolution. I am grateful to the Fundación Areces for its kind invitation, and to Minister Alvaro Nadal for joining us.
The tectonic shifts brought about by digitisation are transforming our economies and our societies in the most profound way. On one hand, these processes have the potential to spark innovation, to generate savings, to improve public services, and to develop new tools and policies for promoting inclusiveness and sustainable development. On the other hand, they are disruptive. They are redefining the way individuals interact, the way businesses are structured, and the way information is shared. This is posing some major challenges in terms of privacy, security, consumer protection, competition, innovation, employment and skills, among many others.
The scope of the change demands a conclusive and comprehensive response – otherwise we could be facing serious economic inefficiencies, worsening inequalities, a growing erosion of the social fabric, and a sharp decline in growth. The great challenge is to develop a balanced mix of policies that will allow us to seize the benefits of digitisation and deal with the disruptions it entails. Allow me to share with you some of our thoughts on digitisation in Spain and on the policies that could convert it into one of the hinges of what we at the OECD have called the Productivity-Inclusiveness-Sustainability Nexus.
Spain's digital economy has experienced rapid development in recent years. Between 2011 and 2016, the number of adults with Internet access via mobile telephone jumped from 17% to 71%, well ahead of the 60% average in the EU-15. The proportion of Spanish households with access to fixed broadband services has also grown sharply, while fibre connection – the fastest broadband technology – has recorded one of the highest growth rates among OECD countries. Businesses have also seen notable progress in terms of access. Even among small Spanish firms, 98% have a broadband connection.
Yet access is only one of the variables in the equation. It is the use of digital technologies that opens new opportunities for productivity and growth. In this area, Spain can do better. The percentage of Spanish adults using the Internet daily lags behind the EU-15 average, due mainly to lower usage amongst elderly, low-educated and low-income individuals. Although the technology has made rapid inroads in Spanish firms, they still need to create the conditions for greater use of tools such as cloud computing. Only 40% of large firms are making use of the cloud. Among medium and small-sized firms, the proportion is 26% and 12% respectively.
If digital transformation in Spain is to be inclusive and to drive more inclusive and sustainable growth, there needs to be a proactive policy response based on three pillars.
First, investment in digital infrastructure must be stepped up. This is essential for satisfying current and future demand, and helping to bridge the digital divide. Such infrastructure is the foundation for many new services, applications and business models. Moreover, it is crucial for underpinning the digital innovations that are transforming production.
It is essential to boost the levels of private investment in research and development in Spain, given that such investment represents only 0.64% of GDP, compared to an OECD average of 1.3% and a level of 3.3% in such countries as South Korea.
Digital infrastructure is also of great importance for the public sector. As part of the Reform of Public Administration, the OECD has been working with Spain in the area of digital government, with a view to improving not only its efficiency but also its capacity for innovation, its openness and the design, implementation and monitoring of public policies. The Economic Survey of Spain that we are presenting today highlights the need to promote greater digitisation in public employment services, so as to create more detailed profiles of the unemployed and connect them more effectively with existing opportunities.
But it is not just physical infrastructure that matters. Data are the new infrastructure of 21st century production. Policies must promote investment in the generation and compilation of data that will impact positively both on business activity and on the openness and functioning of the public sector. We must also examine and remove any obstacles to the re-use and sharing of data. At the same time, we must ensure that privacy and digital security are maintained, so that citizens and businesses will continue to place trust in the digital environment.
Second, we must ensure that the competition framework promotes innovation. As we witness the convergence of fixed-line, wireless and Internet communications, we must review the regulatory frameworks to guarantee that the market remains competitive. Competition policy may also need adjusting in order better to recognise the growing role of digital data and its analysis as a source of competitive advantage in some markets.
In addition, it is essential to ensure proper allocation of capital and better access to public and private financing mechanisms for SMEs, especially in the area of information and communication technologies (ICTs).
Third, it is critical for workers to have the skills and the social protection needed to take advantage of the digital economy. Ambitious and forward-looking strategies are needed that will enable everyone to adapt and thrive in the digital economy. Spain's Digital Agenda constitutes a leap forward in this sense. People need to be able to adapt and renew their skills progressively as on-the-job tasks, tools and processes change and new technologies emerge.
Spain can and must do better in this respect. According to the OECD Survey of Adult Skills (PIAAC), nearly a quarter (23%) of Spanish adults lack basic ICT skills, compared to the OECD average of 15%. This means that formal education and training systems have to stay up to date and provide all workers, including the least skilled, opportunities to up-skill and re-skill throughout the course of their working life. Many of the required skills will be digital, particularly among those population segments that are older or have less access.
These measures must be accompanied by social safety nets and labour regulations adapted to the new reality of the workplace, as well as activation policies that will help displaced workers find new jobs quickly. According to OECD estimates, 12% of jobs in Spain are at high risk of being automated, and it is likely that another 22% of jobs will face significant changes as a consequence. It is also essential to foster an effective social dialogue that will promote fair labour contracts between workers and employers.
Ladies and gentlemen,
As Gracián put it, “science without brains, double folly”. The New Digital Revolution can become a bridge to an inclusive and sustainable future, but we must continue to lay the bases for this to happen, and to strive to make the digital transformation work for everyone.
The OECD stands ready to accompany you on this path, through contributing our experience and through our cross-cutting project on the digital economy – "Going Digital" – which will distil best practices and recommendations in this area. You can count on us in moving forward in this effort and in making Spain's great brainpower an engine of progress and development.
Thank you very much.