Lack of strategy leaves Bulgaria last in terms of digital performance

A view of Vratza, a city in North-West Bulgaria, officially the poorest region in the EU. [Dnevnik, Tzvetelina Belutova]

For a second consecutive year, Bulgaria is ranked last among all 27 EU members in the European Commission’s Digital Economy and Society Index, despite having a powerful IT sector, concentrated mostly in the capital Sofia.

The Digital Economy and Society Index (DESI) published by the Commission summarises relevant indicators on Europe’s digital performance and tracks the evolution of EU member states in digital competitiveness.

Although the data suggests overall progress in all member states, the report for 2020 clearly demonstrates the staggering differences between countries in key areas of the digital economy. Finland, Sweden, Denmark, and the Netherlands boast the strongest digital performance while Bulgaria, Greece, and Romania are on the other end of the spectrum.

Striking disparities

The index explores five main policy areas: connectivity, human capital, Internet usage by individuals, integration of digital technologies by businesses, and digital public services over the last five years.

The report emphasizes the importance of digital resilience during the health crisis, when digital technologies have facilitated remote work, search for vaccines, and virus monitoring.

Ireland, the Netherlands, Malta, and Spain are the countries that have shown the most significant progress. In contrast, Bulgaria, Greece, and Romania have the lowest scores, which means that among EU member states and the UK, they have the least developed digital economies.

Bulgaria has a strong IT sector, but it is concentrated mostly in the capital and there has been no spillover effect of its success for the country’s economic and social development. Large parts of the country are losing their population as a result of under-development, including poor connectivity.

Dick Roche, former Minister for European Affairs of Ireland – the country that has made the most significant progress in this area – told EURACTIV that DESI indicators show some striking disparities across the EU member states.

Main findings

The index shows that Bulgaria ranks last in categories including general connectivity, basic digital skills, e-commerce, digital integration of public services, and business.

The overall result for Bulgaria for 2020 is 36.4 (out of 100) compared to the EU average of 52.6. The results for 2019 were 33.8 for Bulgaria and 49.4 for the EU average, respectively.

Although Bulgaria’s overall score has risen to 36.4, it now ranks lower in the rankings. The reason is that the country has been unable to achieve good results on certain indicators, unlike its EU partners.

The COVID-19 pandemic highlighted the crucial importance of citizens’ digital skills, digitisation of the economy, and reliable and fast internet connection in all member states, including Bulgaria.

During the health crisis, networks have faced a significant increase in demand. In terms of connectivity, according to the EC report, Bulgaria has performed relatively well, especially in terms of wide access to high-speed and mobile broadband networks. It has made some improvements regarding e-government.

The country has also achieved a high result in terms of the provision of digital public services in the business sector.

Regarding the launch of 5G networks, the EC’s report emphasises that progress in the allocation of 5G spectrum across the member states is limited. Only 17 countries have completed the tenders for the 5G spectrum.

The other 10 member states, including Bulgaria, do not have much time until the end of the year to plan their spectrum tenders to meet the European Commission’s 5G targets.

Bearing in mind that the difference between the first and last member state to launch 4G networks was eight years, this time the countries need to act in a much more coordinated and effective way. So far, Finland, Germany, Hungary, and Italy have shown the most progress in terms of 5G readiness.

In a comment for EURACTIV.bg, Bulgaria’s Ministry of Transport, Information Technology and Communications stressed that in the upcoming months, the national Communications Regulation Commission is expected to take the necessary actions to provide spectrum in the 5G bands.

The Ministry underlined the reduction of the initial charges for spectrum for mobile networks by 50% and the annual ones by 35%, which will enable operators to invest the necessary financial resources for the rapid deployment of 5G infrastructure.

In terms of human capital, the level of digital skills of Bulgarian citizens is among the lowest in the EU.

Citizens with basic digital skills make up only 29% of the country’s adult population, compared to the EU average of 58%. Women in ICT make up 1.8% of all employed citizens, slightly above the EU average (1.4%).

When it comes to internet usage, Bulgaria ranks 27th, with the overall score well below the EU average. Around 67% of Bulgarians use the Internet (the EU average is 85%), while 24% have never used it which is the highest percentage among all member states.

According to the report, the use of online banking in Bulgaria has increased slightly, but only 13% of Bulgarians use mobile banking compared to the average of 66% for the EU and 95.2% for the leader – Finland. Only 31% of Bulgarians shop online, while the EU average is 71%. and the leaders are the British with 90.5%.

Gergana Passy, ​​president of the Digital National Coalition and former Bulgarian Minister of European Affairs, told EURACTIV that the new member states such as Bulgaria could become champions if they had the support of their administrations.

Passy gave Malta as an example of a country which has demonstrated remarkable progress in all five policy areas of the index, thanks to its national strategies.

[Edited by Zoran Radosavljevic]

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