Internet economy grows despite war in Ukraine – EURACTIV.com

The German digital industry has continued to grow despite the Russian war in Ukraine, although uncertainty in the industry and among customers remains high, according to a recent report by Digital Echo.

The report, published by environmental and international consultancy Arthur Dee on Tuesday (May 10), looked at the potential impact of the war in Ukraine on Germany’s cyber economy.

Compared to other sectors, the impact on the digital industry has proven to be limited, despite persistent inflation as well as sectoral self-restrictions, the report says. The report adds that the negative effects of the sanctions are offset by price increases.

The Internet industry is a trusted partner in the crisis.Oliver Som, director of the economic environment, said at a press conference on Tuesday, adding that policy should help reduce market uncertainty.

According to eco, it would be desirable to design a fast and reliable transatlantic agreement on data protection or measures to enhance digital sovereignty and energy independence.

The digital policy spokesman for the Green Party in the German Bundestag, Mike Ossendorf, told EURACTIV that “We in politics are faced with the challenge of creating the framework conditions to ensure the planned growth, while ensuring a high level of IT security for German SMEs”.

growth forecast

In the report, analysts forecast steady growth of the Internet economy through 2025, with a healthy average annual growth of 12.2%. This would lead to an increase in turnover of 258 billion euros.

However, as demand may stagnate in some areas or the crisis may cause consumers to cut back on non-essential spending, a medium-term correction phase is expected from 2023, according to the report.

The report also notes that the shift to working from home during the pandemic has already led to increased sales in the Internet economy, where a significant increase in demand for services has been felt in many areas.

Persistent inflation and war in Ukraine are now driving up prices and thus prolonging the revenue growth trend, at least in the short term. But Eco noted that interest rates and energy and production costs are also rising in some cases, meaning that higher sales shouldn’t translate into greater profitability.

An earlier report by the Bitkom Digital Association painted a bleak picture of the future of the digital industry in Germany, as assessments of the situation and business outlook deteriorate after the Russian invasion.

that it “Simple consolation is that the business environment in the digital industry is still much better than in the economy in general.”Achim Berg, president of Bitkom, said in a press release.

modern digital sector

This is the context of the crisis ‘Don’t leave our industry unscathed’Mr. Som said from the environment. « Néanmoins, nous continuons à observer des tendances de croissance dans tous les domaines, ce qui montre que la numérisation n’est pas une tendance à court terme, mais que nous devons continuer à investir dans la transition numérom durableie de l’il the society “Mr. Som said.

Mr Ossendorf, a member of the Green Party, also emphasized that the internet economy is a powerful driver of the German economy, even in times of crisis.

However, according to Mr. Außendorf, in addition to switching the power supply, it was also necessary “Fundamentally challenging the previous IT security policy and implementing several (immediate) measures to increase IT security as quickly as possible.”

According to the report, the industry with the highest growth rate is “Services and applications”Especially since the demand for cyber security services is expected to increase in the near future.

Increased war-related attacks lead to “An increasing willingness to spend more on cybersecurity products”. It is also a great opportunity for local solution providers.

Although a massive cyber war against German companies is unlikely, the uncertainty and risks “It remains high and should be expected in the future with more secure and robust IT systems and infrastructure”says the report.

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