Strengthening Transatlantic Ties on Digital Topics: Quick transatlantic wins in times of political uncertainty

Manuel Kilian

Axel Springer ecosystem

Manuel Kilian is a Senior Project Manager for Investing and Venturing at the Axel Springer ecosystem firm which supports industries and governments in their digitalisation efforts. Prior to this, Manuel served as the Senior Manager to the President of the Federation of German Industries (BDI), the biggest economic lobby group in Germany. Apart from this, he gained professional experience at the Cabinet Office, Deutsche Bank and the UN Environmental Programme.

Manuel holds an MPhil in Public Policy from the University of Cambridge and a BA in European Studies from Maastricht University and Sciences Po Paris. He is passionate about the digital transformation and its impact on society and economics.

He is a 2017-2018 participant in AICGS’ project “A German-American Dialogue of the Next Generation: Global Responsibility, Joint Engagement,” sponsored by the Transatlantik-Programm der Bundesrepublik Deutschland aus Mitteln des European Recovery Program (ERP) des Bundesministeriums für Wirtschaft und Energie (BMWi).

It is beyond doubt that transatlantic relations are not in their best condition, in particular traditional areas of cooperation such as trade or security and defense. There is no real alternative for this cooperation, so strengthening it should be in the interest of both sides of the Atlantic. However, given the unclear stance of the current U.S. administration and Europe’s internal struggles around Brexit and future integration, pouring oil on troubled transatlantic waters does not come easy.

With the traditional areas of transatlantic cooperation being in temporary deadlock, it is worth turning toward new joint projects. This comes at a time when digitalization is massively transforming societies and economies both in the U.S. and Europe. Cooperating on digital topics can restart the transatlantic engine for a number of reasons: First, cooperation can grow naturally with the increasing importance of digital topics; second, the U.S. and Europe need each other to set global standards based on shared values; and third, new actors detached from transatlantic discussions on politically sensitive topics can be brought to the table.

The dynamics of the digital transformation play into the hands of this cooperation: While the U.S. economy is the global forerunner of digital innovation in B2C markets, Germany as Europe’s economic powerhouse increasingly leads the way toward the digitalization of manufacturing B2B markets, where it is traditionally strong. In other words, the digital strengths of the U.S. and Europe are somewhat complementary. If combined cleverly, they can play out for the benefit of both regions—and become the global benchmark.

Cooperation in the area of technical interoperability and standardization would be a quick win that should not be underestimated. With the Plattform Industrie 4.0 and the Industrial Internet Consortium, there is one organization on each side of the Atlantic building an architecture system for the smooth interaction among connected products and within smart factories. The two organizations recently joined forces to develop a roadmap to make both systems interoperable and already showcased their work around the world. This approach of bridging the Atlantic to present a solution that can become the global standard is the blueprint for transatlantic cooperation in the digital era and should be extended to other technical areas that would benefit from greater interoperability. This follows the strategic rationale that defining standards together is certainly more desirable than having architectures imposed by other key players, most notably China, that may be politically motivated.

A second promising area of cooperation evolves around the challenge of how to adapt the labor force to the digital world. Building the right skills for mastering the digital transformation will be a major undertaking. The telecommunication company AT&T, for example, invests heavily in the further education of its 280,000 employees. Interestingly enough, its German counterpart Deutsche Telekom has a different idea for retraining. In typical social market economy fashion, it envisions a scheme where businesses and public authorities together support individuals in their upskilling endeavors. Although it remains unclear how Europe and the U.S. want to overcome the challenge of educating and retraining a large part of their labor force, it may prove helpful for the U.S. to look across the Atlantic for solutions: Despite the U.S. president’s antipathy toward imports, he seems positive about introducing the German vocational training system to the U.S. If this helps improving the standing of German companies in the U.S., both sides win—and transatlantic ties are strengthened.