Businesses must invest in ICT to boost economy, finds research

The European economy could be boosted by billions of euros over the next decade if businesses increase investment in information and communication technology (ICT), according to research.

A six-month study by AT&T and research company Oxford Economics found European countries have fallen behind US levels of IT investment and productivity growth. The report says a greater investment in technology could help European gross domestic product (GDP) grow by €760bn by 2020.

"This would be worth around €1,500 per person at today's prices. ICT-driven innovation would contribute approximately one third of that growth - around €220bn," continued the report.

[Download the AT&T and Oxford Economics report, 'Capturing the ICT Dividend' (free registration)]

Andrew Edison, regional vice president for AT&T Europe, said businesses can aid growth by increasing investment in ICT.

"Productivity is the cornerstone of economic growth. There is clear evidence that investing in technology can make European companies more productive and competitive, which is critical to growth in these tough financial times," he said.

He added that investment in IT hardware needs to be supplemented with investment in IT skills.

"The investment needed in technology isn't all about buying new kit. Investment needs to be made in people, skills and processes to get the full return on investment (ROI)," he said.

Edison believes that without matching US levels of ICT investment by 2020, emerging economies like Brazil could "overtake the Eurozone" in terms of productivity.

Fabio Colasanti, senior adviser at the European Policy Centre, believes European governments have a responsibility to put ICT policies at the heart of economic agendas.

"National governments must prioritise ICT investment more effectively and focus on creating the right conditions for investment. This means improvements to ICT infrastructure, more flexible labour markets and better ICT education," he said.