Portuguese digital literacy must improve says Google Portugal boss

Only 50% of the Portuguese population has basic digital skills and 25% have no working digital skills whatsoever.

The situation has to change according to Bernardo Correia, Country Manager, Google Portugal who on Wednesday (23 June) addressed the Transatlantic Economic and Trade Summit organised by the American Chamber of Commerce in Portugal (AmCham) which this year celebrates its 70th anniversary.
Fronting what he calls a “proudly American company” Correia helped to address the question of how digital transformation will affect Portugal over the next 10 years, and what opportunities for business will it present, particularly for the EU-US Transatlantic Relationship?
Correia started with an anecdote of an entrepreneur, Jacqueline Lamb, a light aircraft flying instructor who, because she was grounded during the pandemic, used her time in lockdown to sell a well-known US brand of makeup for the maturer woman online through channels like Youtube and Instagram. “It is a niche audience that she discovered during the pandemic so that she could earn income while she was unable to fly and is a good example of what it means to use digital tools to empower small and medium businesses to grow and exponentially”.

A valuable and growing market

The transatlantic economy is worth about US$6.2 Trillion while the US and Europe are each other’s two most important commercial partners when it comes to digital. In fact, 75% of digital content is produced in North America and Europe, and 55% more digital data is channeled through sub-Atlantic ocean cables than between the US and Asia. “The digital economy between the US and Europe is absolutely intertwined”.
Correia says digital represents a “remarkable historical opportunity” with incredible potential for both sides of the Atlantic for entrepreneurs and Portuguese companies. In 2019 the digital economy was worth about €9Bn or 5% of GDP to the Portuguese economy. However, the European average for digital was already about 8% of the EU economy while for developed economies like the UK, the weight of the digital economy was 14% (£149Bn), +1.4%.
“If Portugal catches up with the European average (8% of GDP), digital is worth €20Bn more to the Portuguese economy adding an extra 3% onto the country’s GDP,” said the Google Portugal boss.
“We can see this today already in motion in the Portuguese economy with companies like Outsystems Talkdesk, DefinedCrowd and Unbabel and all of them have significant US business which was not the case 10 years ago,” said Correia. “How many Portuguese companies do you know that were operating out of the US market 10 years ago?”
Correia says that is only possible because these companies sell technology-driven dematerialised goods and services, and points out that companies like Google have a responsibility to help these companies access the US market.

Helping startups

In fact, Portugal’s largest venture capital fund, Indico Capital Partners, run by Stephan Morais and Ricardo Torgal, has teamed up with Google Portugal to help new, innovative and exciting startups in Portugal to get the funding they need to grow their ideas and businesses.
In April, Indico Capital Partners launched the 2021 edition of its acceleration and investment programme for young startups with Google for Startups.
The companies which are currently in the fund have already raised €626 million since 2019 and have now been joined by 10 new startups who were looking for their first round of investment from institutional investors.
This year’s programme was presented with Cristina Fonseca (Talkdesk founder) with the aim of encouraging startups that were ready to launch onto the market to apply for Indico’s €100,000 investment. The 12 month pre-seed programme includes mentoring presentations from founders and successful international investors, presentations from ecosystem partners, support in attracting funds and talent.
All of the companies on the programme quickly raise additional capital after having got the upfront investment as part of the programme.
“The investment aims to encourage a greater creation of startups and offer projection to the most promising ones in order to help them go international and take advantage of greater investment opportunities such as access to more finance from Indico which could be anything up to €5 million per company,” says Stephan Morais in an interview with Essential Business.
Indico Capital Partners established the partnership with Google and launched the pre-seed investment programme with Google for Startups in 2020. Some 140 startups in Portugal applied for the programme and seven were selected to become part of Indico’s portfolio, each one receiving €100,000 investment.
“We have a responsibility to allow our entrepreneurs here in Portugal to access the US market and allow them to work their magic,” says Bernardo Correia.
Also, he says US companies add a lot of value to the European economy. Google’s presence in Portugal is worth around €2.5Bn a year in terms of GDP for Portugal.

What needs to be done

Improving the digital skills of the population and companies, building digital infrastructure and responsible regulation are three things that Portugal needs to work on says Correia.
“Today only about 50% of the Portuguese population have basic digital skills. One-quarter of the population have no digital skills at all and we need to fix this,” he says.
Google Portugal says it does have a programme where it trains more than 100,000 Portuguese people, especially the unemployed, in digital skills.
Google Portugal and the Portuguese government recently signed a memorandum of understanding aimed at economic recovery and accelerating the digital transition, in which digital skills and employability are the main areas foreseen in the document.
The programme “Grow Portugal with Google” is aligned with the priorities defined by the Portuguese Government in digital skills, employability, startups and artificial intelligence.
The memorandum of understanding, signed by the Minister of State for the Economy and the Digital Transition, Pedro Siza Vieira and the Country Manager of Google Portugal, Bernardo Correia, establishes six programmes to develop a rapid acceleration of technological adoption, currently underway.
“We have established this programme where we gave out more than 3,000 IT certificates and re-qualified people for IT jobs, but there is a lot more that we need to do,” admits the Google Portugal chief.
Google also recently announced that it is completing a cable from Europe to Africa (Sesimbra near Lisbon to South Africa).
The economic impact study for this cable suggests an impact of around €500 million to the Portuguese economy.
“This is the kind of project that if you let small and medium size businesses use, it acts like a fast-lane link between European and African businesses and opens the way for American tech company investment,” he told the conference.
On the question of regulation there is some focus on the transatlantic relationship with the strategic interdependence between the US and Europe and their shared values.
“We as an industry want to play an active role in this and it is our duty to do so, but in reality this is even more important for Portugal as a market.”
Correia says he is confident there will be a working regulatory framework between Europe and the US, one which will be particularly important for Portuguese companies that want to export to the US.
“The most important thing is dialogue, the European and US regulators harmonise their regulations and create a common framework for cooperation between Europe and the US,” he concluded.