From the USA and China

Europe far behind in the export of digital goods

While US companies exported digital products worth 672 billion US dollars in 2021, companies from the EU only exported 48 billion US dollars.

(Bild: thinkstockphotos.de)

The well-known global internet giants mostly come from the USA or China. This is also reflected in foreign trade statistics: digital exports from the USA are more than ten times the value of Europe's digital exports, while those from China are still more than twice as high.

It was known that Europe was lagging behind, but now a calculation involving Philipp Koch from the economic research institute EcoAustria is available that shows the dimensions.

Digital exports include, for example, video streaming or a cloud solution if they are purchased across borders. It is difficult to record such transactions, as large technology companies in particular conceal their foreign transactions via local subsidiaries, according to a press release from EcoAustria.

Using machine learning combined with turnover statistics from more than 15,000 companies, the team with Koch created bilateral trade estimates for 31 sectors, 189 countries and the six years from 2016 to 2021. Their results were published in the journal "Nature Communications".

According to the study, US companies exported digital products worth 672 billion US dollars (629 billion euros) in 2021, while companies from the EU only exported 48 billion US dollars. China was also significantly more successful than European companies in the same period, exporting 107 billion US dollars.

Production concentrated, consumption more widely dispersed
The study also shows that production is concentrated among fewer manufacturers than for other goods in global trade, while consumption is more widely dispersed. Global digital trade had a turnover of just under one trillion US dollars in 2021, which corresponds to around 3.5 percent of global trade. At the same time, the sector has grown by almost a quarter (24%) annually in the six years under review. If this growth continues, digital products could account for 15 percent of global trade by 2030.

"Key element for economic prosperity"
Austria is an export country in itself, but this only applies to the digital sector to a limited extent. Only 1.1 percent of exports, or less than 290 million dollars in 2021, were accounted for by digital goods, writes Koch. Increased digital exports are "a key element for the long-term economic well-being of Austria and Europe in the global market". Europe must strengthen the digital sector and invest in digital infrastructure in order to remain competitive.

The figures are conservatively estimated, according to the study, as the definition of digital products is narrower and the estimated trade volume is therefore smaller than in other studies on the subject. The results were extrapolated on the basis of very large digital companies, which may also have distorted the results.