Digital and innovations – flourishing digital ecosystem

The Czech Republic is creating a prosperous and sustainable national digital ecosystem. Based on the main strategies (e.g. Digital Czechia, the National Artificial Intelligence Strategy, RIS3 Strategy and the 5G Strategy), the plan is to interconnect all of the main stakeholders in the field of digital technologies (e.g. AI, HPC, quantum-computing and cybersecurity) and data economy and together contribute to the development of flourishing digital ecosystem. With the help of digital tools and smart solutions, the Czech Republic aims to boost competitiveness of its economy that has been negatively affected by ongoing crisis.

The Czech Republic is a country that has great tradition of high-level education, research or top-edge industry. To stay among the most progressive countries the government and the business invests high amounts of financial means into support of research, development and innovation. The amount of investments is close to 2% of GDP and these investments are accompanied by additional support in the area of digital technologies and digital transformation generally. In this text I would like to present more detailed view of the Czech digital innovation environment.

Support of the Czech digital ecosystem 

Czech government recognises the importance of new digital technologies which have a great potential to improve quality of our life while increasing the performance of the economy. The Czech Republic emphasizes human-centric and innovation friendly approach to digital technologies that is essential for upholding our democratic values and human rights while creating thriving digital ecosystem that enhances competitiveness of our businesses. This approach is reflected in the main strategic documents concerning digital economy, specifically in the conception Digital Czechia and in the National AI Strategy which is currently being evaluated and will be updated based on the recent developments in the area of AI.

To achieve ambitious goals set in the strategic documents, the Czech government has committed to fund projects aimed at boosting innovation and digitalization, with focus especially on SMEs. This approach is supported by Czechia’s resilience and recovery plan under the Recovery and Resilience Facility (RRF) where 22 % of the budget is dedicated to digital transformation of businesses, improvement of connectivity and development of advanced digital skills. At European level, the Ministry of Industry and Trade is the national coordinator of the Digital Europe Programme, which provides funding for projects aiming at bringing technology to citizens and private and public bodies. Therefore, the Ministry of Industry and Trade is heavily involved in building an interconnected and sustainable digital ecosystem in the Czech Republic which consists of three main pillars - European Centre of Excellence in AI, network of European Digital Innovation Hubs (EDIHs) and the AI Testing and Experimenting Facility (AI TEF) in manufacturing.

Digital Europe Programme and National Resilience and Recovery Facility – Projects to support innovation and digitalization of small and medium enterprises (SMEs)

To support the development, deployment and use of new technologies that underpin innovation in areas of public and private interest and recognising the importance of digitalisation, the European Commission has launched the Digital Europe Programme, which is focused on the development and deployment of new technologies such as AI, HPC and emphasizes importance of cybersecurity. One of the most important implementation tools comprises the AI TEFs. European reference testing facility focused on Manufacturing will have a Czech representation, since one of the candidates was successful in the European call on AI TEF Manufacturing. Moreover, all six nominated candidates from the Czech Republic succeeded in the European round of the call for European Digital Innovation Hubs. EDIHs foresee to provide necessary services for the digital transformation of SMEs and public administration. These projects are envisaged to be financed from the National Recovery Plan. Furthermore, with support from the National Recovery Plan, the Czech Republic plans to establish regulatory digital sandbox which supposed to help businesses to test new technologies before introducing them to the market. It is also one of the tools how to support businesses to comply with regulation in respective areas. At the national level, the project entitled "AI for Citizen's Safety and Security vs. Covid-19" (ECE), which was governed by a consortium of research organizations consisting of Czech Technical University in Prague, Masaryk University and Charles University, was completed in 2022. The project was financially supported by the Ministry of Industry and Trade of the Czech Republic and created the additional conditions for the development of Czech AI ecosystem.

Czech Startup ecosystem
For the development of the Czech innovation ecosys- tem in digital (but not limited to digital) technologies we realize many activities to increase the efficiency of the technology and knowledge transfer, especially in the area of innovative startups and spinoffs. The main body that supports this ecosystem on the national level is the CzechInvest Agency that has been supporting innovations and startups since 2011.

By 2022, it has supported more than 430 startups through several different projects. One of the most important ones called Support for Startups ran from 2016 to 2022, sending an average of 5 startups abroad per month and supporting more than 200 of them. In 2022 CzechInvest launched its largest project to date Technology Incubation which plans to support up to 250 startups in seven promising areas for the economic development of Czechia, including AI, mobility, and EcoTech.

The future of CzechInvest will be shaped by support for innovation and investment in projects with high added value. In addition to the Internationalisation project, which will complement the Technology Incubation and help startups expand abroad, the agency plans to continue with the Investment Academy for Startups. Recently the Ministry of Industry and Trade together with CzechInvest has also boosted the cooperation with European Investment Fund entitling it with mandate to operate three funds focusing on preseed investment, technology transfer and also on innovative solutions under the heading of regulatory sandboxes. CzechInvest sees the future in innovation, technology, and startups and will continue to help the Czech startup ecosystem so that the Czech Republic can become one of Europe's technology leaders.