The road ahead

The coronavirus pandemic has presented us with challenges, but has also shown that Norwegian employees and businesses are robust and adaptable. However, it is difficult to make plans and launch long-term measures while in the middle of a crisis of unknown duration.

Zoom in on image

Photo: invisiblepower on Unsplash. Free content

Over the last year, the Government has adopted a range of measures to combat the crisis, but also to prepare Norway for the road ahead. Some of the measures were intended to alleviate the difficult economic situation prevailing during the pandemic. However, many of the measures presented in this document – such as those related to competence enhancement or development of digital public services – will not only help cope with the coronavirus crisis, but also leave Norway in a stronger position once the crisis is over.

The Government’s work on digitalisation and innovation

In the middle of a crisis, quick action is required. However, it is also essential to continue efforts that are already underway. In the summer of 2019, the Government published its digitalisation strategy for the public sector, and in 2020, the Government has been preparing a number of strategies and white papers that will help drive forward the work on innovation and digitalisation in the years to come.

The national strategy for artificial intelligence

The Government launched its strategy for artificial intelligence in January 2020. The strategy stipulates that Norway shall make use of the innovative potential inherent in the use of artificial intelligence, and seek to assume a leading position in the use of artificial intelligence, especially in areas where Norway has good qualifications and strong scientific communities. The Government wants Norway to become a pioneer in the development and use of artificial intelligence respecting individual rights and liberties. Artificial intelligence in Norway shall be based on ethical principles, respect for privacy and good digital security.

Report to the Storting no. 30 (2019–2020) on innovation in the public sector

The Government’s goal is an efficient public sector that provides high-quality services to citizens, enjoys a high degree of trust among the population and finds new solutions to the challenges society is facing in collaboration with private individuals, industry, research communities and civil society. To achieve this goal, the public sector needs to rethink old solutions.

The Government presents three main principles for innovation in the public sector:

• Politicians and authorities must provide space and incentives for innovation.
• Leaders must develop a culture for and skills in innovation, and foster courage to rethink old ways and learn from failures and successes.
• Public enterprises must search for new forms of collaboration.

Report to the Storting no. 22 (2020–2021) on the data-driven economy and innovation

The Government wants to create more value and new work opportunities in all parts of the country using data as a resource. Data is increasingly contributing to value creation in many sectors and business areas, but there is still a potential for growth in the years to come. Better utilisation of data will promote the digital green transition and reinforce the competitiveness of Norwegian industry. Data should be shared in accordance with the FAIR data principles.

Report to the Storting no. 28 (2020–2021) on electronic communication

Digital development in society presumes that residents, businesses and authorities have a stable and good access to electronic communication networks. A growing range of critical societal services rely on a well-functioning electronic communication network. The government has therefore put forward a report to Parliament on mobile, broadband and internet services, focusing especially on the need for secure and robust electronic communication services.

Revision of the strategy ‘Powered by nature’

The large growth in data volumes means a need for more data centres, and the data centre industry is currently the world’s fastest growing energy-intensive industry.

An analysis undertaken for the Ministry of Local Government and Modernisation in 2020 shows that there are 18 data centres in the Norwegian market. The data centre industry is growing quickly, and it has been estimated that as of 2020, the industry accounts for approximately 2000 jobs and provide NOK 3.1 billion to the economy. This growth is expected to continue.

The Government wants Norway to be an attractive nation for data centres and other data-based businesses. In 2018, a separate data centre strategy was therefore launched, including measures such as a lower consumer tax on electricity for data centres, and a clearer land-use planning procedure for data centres. A revised data centre strategy will be ready in 2021.

A digital marketplace for cloud services

In 2021, the Government will establish a marketplace for cloud services at the Norwegian Agency for Public and Financial Management (DFØ). The marketplace will make it easier for the public sector to procure secure, legally compliant and cost-effective cloud services. The marketplace will provide an overview of compliant cloud services, as well as framework agreements. There will also be provide guidance on risk assessments and security requirements for cloud services.

Coronavirus commission – ‘Norway towards 2025’

The coronavirus pandemic may have given rise to permanent changes that affect the basis for value creation, production, employment and welfare in Norway. Consumption patterns, production patterns, industry structures and conditions in working life may change. Internationally, trade patterns and commercial relations may change.

The Government appointed a commission in May 2020. The objective was to get a good analyses of how the coronavirus pandemic will affect value creation, production, employment and welfare in Norway in the years to come. The results were presented in a Norwegian Official Report – ‘Norway towards 2025’ in March 2021.The commission recommends measures for stronger competitiveness, reduced emissions of greenhouse gases and green growth, a well-functioning labour market and high employment, and economic sustainability. Coronavirus measures that limit the ability to restructure the Norwegian economy should be terminated as soon as it is prudent to do so. Compensation schemes should support restructuring that are needed, regardless of the pandemic. It is of particular importance that young people and other employees with a weak connection to the labour market return to work as quickly as possible.

Increased grants for digital restructuring in industry

Innovation Norway is the main instrument that central government and county authorities use to instigate value-creating industrial development all over the country. Innovation Norway’s remit includes helping to promote entrepreneurship, more viable enterprises and innovative business communities.

In recent years, Innovation Norway’s portfolio has seen a growth in the number of digital projects. In 2020 the growth in this area was especially high – the number of ICT projects tripled compared to 2019. Digitalisation projects are found in all sectors.

The coronavirus effect

The marked growth in ICT projects is associated with the coronavirus crisis. The crisis has helped speed up the pace of digitalisation. Many enterprises see how increased digitalisation helps reduce location disadvantages, especially in relation to European markets. Digitalisation is increasingly regarded as a prerequisite for competitiveness: in a study undertaken during the coronavirus crisis among Innovation Norway’s clients, more than 70 per cent of the respondents state that digitalisation is essential for them to succeed in the future.

Much of the digitalisation undertaken in 2020 has involved efficiency enhancement, such as digitalisation of communication and contact in markets and value chains. There has been a slowing down in the number of large restructuring projects involving major changes to production and business models. These are more long-term investments in digitalisation for permanent restructuring and will be crucial in the years ahead. Innovation Norway will prioritise services that support future restructuring needs while factoring in the prevailing situation, for example by providing new skills, new venture capital and access to new clients. The Government has doubled the allocation for innovation support to industry through Innovation Norway, from NOK 7 billion in 2019 to NOK 14 billion in 2020.

The Digital Europe Programme (DIGITAL)

The EU has proposed to establish a comprehensive digitalisation programme, the Digital Europe Programme (DIGITAL), for the years 2021–2027. This is the first time the EU proposes a separate programme dedicated to digitalisation in society and industry.

The DIGITAL is a key element in the EU Commission’s work on digital transformation and targets areas where individual countries by themselves will not have the resources needed to succeed. The programme aims to establish the EU as a driving force for the digital transformation and promote future-oriented technologies that are expected to have a major impact on growth and employment in Europe over the next years. The programme will also seek to help small and medium-sized businesses to adapt to changes that follow from technological development, for example in the areas of digital transformation and artificial intelligence.

The programme is proposed to have an economic framework of EUR 7.17 billion, divided into five main areas: High-performance computing (HPC), artificial intelligence, cybersecurity, digital transformation and advanced digital skills.

The Government proposes full Norwegian participation in DIGITAL 2021–27. A final decision on Norwegian participation in DIGITAL will be taken by Parliament in 2021.

Special focus on SMEs and start-ups

Small and medium-sized enterprises account for a large part of Norwegian business life. Enterprises with fewer than 50 employees provide employment for more than one million people in Norway. These enterprises are essential for building and maintaining vibrant local communities. On the other hand, small enterprises and businesses in the start-up phase will tend to focus on production and day-to-day operations. This may make it difficult for them to devote resources to development and restructuring.

European Digital Innovation Hubs (EDIHs)

The digital innovation hubs play a key role in the Digital Europe Programme (DIGITAL). EDIHs are one-stop shops that will help companies become more competitive with regard to their business/production processes, products or services using digital technologies. EDIHs provide access to technical expertise and experimentation, so that companies can ‘test before invest’. They also provide innovation services, such as financing advice, training and skills development that are needed for a successful digital transformation.

EDIHs will be established all over Europe. Those who use the EDIHs will therefore have access to other European knowledge communities, which may have ‘know how’ or test facilities that are not available in Norway. It is expected that Norway can establish 2–4 EDIHs under DIGITAL.

Programme for start-ups

Young, innovative enterprises may find it especially difficult to get into position to win contracts with public sector organisations. The Government wants to make provisions for the public sector to make better use of the opportunities provided by start-ups, and has therefore established a programme for procurement of innovations from such enterprises. The core of the programme will see public agencies formulating challenges and needs, to which start-up communities and other innovative actors can find solutions.

The ‘Data Factory’

In order to realise value from data, they need to be processed and analysed. This requires data of the correct technical quality, management of intellectual property rights, and clarification of issues related to privacy. Addressing all these concerns requires specialist competence of a kind that few Norwegian enterprises have in-house.

The data factory will be able to clarify such matters, as well as distribute data from a range of different sources. The data factory will help SMEs and start-ups obtain relevant data and provide support for data-processing. The data to be distributed through the factory will come from private businesses as well as the public sector. The data factory will be developed and operated by DigitalNorway in collaboration with the Norwegian Digitalisation Agency.