Economic Archives | Digital Watch Observatory

Latvia gains EIB expertise to scale technology companies

The European Investment Bank (EIB) will guide Latvia on promoting technological innovation and scaling high-growth companies.

Cooperation with the Ministry of Economics and the Investment and Development Agency of Latvia (LIAA) aims to strengthen national policies, financing tools, and support mechanisms.

EIB experts will assess existing support for businesses, research, and emerging technologies, while exploring regional alignment with Estonia and Lithuania to foster Baltic-wide initiatives.

The advisory programme includes capacity-building for public authorities and universities, ensuring practical, market-aligned solutions. Riga Technical University’s development plan will be evaluated to link investments with national innovation objectives.

Recommendations will provide a strategic roadmap to amplify the innovation ecosystem of Latvia and attract international investment.

The initiative falls under the InvestEU programme, using data-driven insights to bridge early-stage financing gaps, support scale-ups, and enhance high-growth sectors.

Latvia’s goal is to expand its tech ecosystem, increase competitiveness, and integrate with Europe’s dynamic innovation networks.

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Corning and Meta start construction on North Carolina AI cable facility

Corning Incorporated and Meta Platforms have begun construction on a major expansion of Corning’s optical cable manufacturing facility in Hickory, North Carolina. The project will support advanced AI data centres using US-developed technology.

The initiative is part of a multiyear, up to $6 billion agreement between the two companies to accelerate the deployment of high-performance data centres. Under the agreement, Corning will supply Meta with new optical fibre, cable, and connectivity solutions.

Meta will act as the anchor customer for the Hickory expansion, which will produce optical cable critical for AI infrastructure. The expansion is expected to strengthen domestic manufacturing and create additional skilled jobs in North Carolina.

Corning currently employs more than 5,000 people in the state and plans to increase its workforce by 15 to 20 percent. Executives emphasised the partnership’s role in advancing US innovation and supporting the next generation of AI infrastructure.

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Eurasian Development Bank Fund expands digital cooperation with Uzbekistan

A delegation from the Fund for Digital Initiatives (FDI) of the Eurasian Development Bank (EDB) visited Uzbekistan to enhance cooperation in digital transformation and AI technologies. Tigran Sargsyan, Vice Chairman of the EDB Management Board, met with Sherzod Shermatov, Minister of Digital Technologies and National CIO.

The meeting highlighted ongoing initiatives, including solutions in water management, labour markets, jewellery trade, and air quality monitoring. Uzbekistan’s Ministry representatives expressed interest in evaluating FDI-supported projects and presenting their own digital solutions.

Both parties agreed to develop a joint roadmap for implementing the projects and strengthening long-term collaboration. The FDI delegation also toured IT Park Uzbekistan to understand its role in innovation and startup development.

The visit marked a step toward accelerating Uzbekistan’s digital transformation and expanding economic and technological ties with the EDB Fund. Planned projects aim to integrate AI and digital tools to support sustainable growth and innovation.

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IMF warns of rising risks in tokenised financial systems

The International Monetary Fund has warned that central banks could struggle to keep pace as tokenisation reshapes financial systems. Converting traditional assets into blockchain-based tokens is seen as a structural shift, improving efficiency while introducing new systemic risks.

According to the IMF, faster settlement and automation may reduce risks but also shorten reaction times during market stress. Instant transactions could trigger rapid margin calls and capital movements, limiting the ability of regulators to intervene effectively in emerging crises.

Tobias Adrian, Financial Counsellor of the International Monetary Fund and Head of their Monetary and Capital Markets Department, emphasised that tokenisation is transforming how financial products are issued, traded, and managed.

Concerns include unpredictable capital flows, faster currency shifts, and pressure on monetary sovereignty. Authorities are encouraged to replace legacy regulatory frameworks with more flexible systems capable of monitoring liquidity and leverage in real time.

Large institutions such as BlackRock, JPMorgan Chase, and Nasdaq are piloting tokenised markets, with strong growth potential projected. Estimates range from a few trillion dollars to as much as 16 trillion dollars by 2030, highlighting both the scale of opportunity and uncertainty surrounding adoption.

Tokenisation reflects a broader shift in how value is created, exchanged, and trusted in the digital age, gradually moving finance towards more programmable and interconnected systems.

Its importance lies in how it may redefine the relationship between institutions, markets, and users, shaping not only efficiency and access but also the future balance between innovation, governance, and stability.

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ENISA opens public review of draft EUDI Wallet cybersecurity scheme

The European Union Agency for Cybersecurity has published a draft candidate scheme for the European Digital Identity Wallet and the electronic identity schemes under which it is provided. ENISA describes it as a draft version of the European Cybersecurity Certification Scheme for European Digital Identity Wallets.

ENISA states the draft addresses the certification of the cybersecurity of cloud services and is being developed under Article 48(2) of Regulation (EU) 2019/881, the Cybersecurity Act.

As per ENISA, an ad hoc working group has been set up to prepare the candidate scheme. The agency says the public review is intended to validate the principles and general organisation of the proposed scheme and to gather feedback on the draft and its annexes.

ENISA also says the draft candidate scheme is accompanied by an early draft of a separate document, Wallet-Related Service Provider Security Requirements, version 0.5.614, which is provided as a reference and for early opinion on the approach used to define those requirements.

The public review will remain open until the end of April 2026. ENISA has also said it will organise a webinar on 8 April to provide information about the draft candidate scheme and answer questions.

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Transparency push for online advertising systems

Researchers from the University of California and Iowa have warned that structural weaknesses in the digital advertising ecosystem continue to expose advertisers to hidden risks and fraud. The study highlights how complexity and limited transparency enable manipulation across the supply chain.

A key issue identified is ‘dark pooling’, in which lower-quality advertising inventory is bundled with premium placements, obscuring their true value. This practice can mislead buyers and distort pricing across the market.

The authors argue that current safeguards fail to address these vulnerabilities effectively, as responsibilities are fragmented among multiple stakeholders. This lack of coordination allows systemic issues to persist.

To address the problem, the researchers propose a shared vulnerability notification framework involving advertisers, publishers and intermediaries. The study suggests such collaboration could strengthen accountability and improve trust in digital advertising markets in the US.

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CNN develops agent infrastructure for AI media trading

CNN is developing an internal agent infrastructure as part of a plan to begin AI-driven media trading by early 2027. The company aims to complete protocol scoping by the end of the second quarter before moving into testing phases later in the year.

Testing will focus on how properties are interpreted by large language models and how buyers allocate budgets to agent-based systems. Executives say the timeline may change as the technology and market conditions continue to evolve.

The initiative combines in-house development with external technology partners, while aligning with industry frameworks to ensure compatibility. CNN is also working with standards bodies to ensure agent communication produces accurate outcomes for buyers.

Agentic protocols enable systems to exchange information, negotiate pricing, and manage tasks autonomously between buyers and sellers. The company is prioritising consistent communication to support efficient and reliable transactions.

Early efforts are centred on learning and experimentation, even without immediate revenue generation. Initial use cases are expected to focus on performance-driven campaigns before expanding into broader advertising activities.

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DMCC Act 2024 brings UK ADR reporting rules into force

UK regulations under the Digital Markets, Competition and Consumers (DMCC) Act 2024, referred to here as the DMCC Act 2024, are now in force, requiring accredited alternative dispute resolution providers to report information to the ADR authority and to make it available to consumers on their websites.

Under the DMCC Act 2024 (Alternative Dispute Resolution) (Information) Regulations, an accredited ADR provider must submit an annual report to the ADR authority in writing on a durable medium.

An accredited ADR provider is a person or entity that either conducts alternative dispute resolution for a consumer contract dispute or arranges for it to occur. The same information must also be published for consumers on the provider’s website within one month of each anniversary of accreditation.

Accredited ADR providers must also notify the ADR authority of any changes to the information listed in Part 2 of the Schedule. Former accredited ADR providers are required to submit a Part 1 report within one month after their accreditation ends.

Exempt ADR providers must provide the information in Parts 1 and 2 of the Schedule to the ADR authority to the extent that the same information is also supplied to a regulator, and must do so within one month of providing it to that regulator.

Why does it matter?

The DMCC Act 2024 regulations add transparency to the UK ADR system. Accredited providers must now report information to the ADR authority and publish it for consumers, creating clearer oversight and making it easier to see how accredited schemes operate.

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OpenAI presents policy proposals addressing AI’s economic and labour impacts

Policy proposals advanced by OpenAI outline a vision of economic restructuring in response to the growing influence of AI.

Framed within an emerging ‘intelligence age‘, the approach reflects concerns that AI-driven productivity gains may concentrate wealth while undermining traditional labour-based economic models.

The proposals, therefore, attempt to reconcile market-led innovation with mechanisms aimed at broader distribution of economic benefits.

A central element involves shifting taxation away from labour towards capital, reflecting expectations that automation will reduce reliance on human work.

Instruments such as robot taxes and public wealth funds are presented as potential tools to redistribute gains generated by AI systems.

Such proposals by OpenAI indicate a policy direction where states may need to redefine fiscal structures to sustain social protection systems traditionally funded through employment-based taxation.

Labour market adaptation forms another key pillar, with suggestions including shorter working weeks, portable benefits, and increased corporate contributions to social welfare.

However, reliance on employer-linked mechanisms raises questions about coverage gaps, particularly for individuals displaced by automation. The proposals highlight ongoing tensions between corporate-led welfare models and the need for more comprehensive public safety nets.

Alongside economic measures, the framework addresses governance challenges linked to advanced AI systems, including systemic risks and misuse.

OpenAI’s proposals also recommend that oversight bodies, risk containment strategies, and infrastructure expansion reflect an effort to balance innovation with control.

Treating AI as a utility further signals a shift towards recognising digital infrastructure as a public good, though implementation will depend on political consensus and regulatory capacity.

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South Korea advances energy transition strategy to strengthen resilience and green industry

An expansive energy transition strategy has been outlined by South Korea aimed at reshaping its national energy system around renewables, electrification and industrial transformation.

The plan responds directly to heightened geopolitical risks and supply vulnerabilities, signalling a shift from import-dependent energy security towards domestic resilience.

Central targets include exceeding a 20% renewable energy share and deploying 100GW of capacity by 2030, alongside accelerating the adoption of electric and hydrogen vehicles across both public and commercial fleets.

The strategy by South Korea reflects structural change, combining large-scale renewable expansion with the phased retirement of the 60 currently operating coal-fired power plants by 2040 and the introduction of a ‘just transition’ framework to mitigate regional and labour impacts.

Industrial policy plays a central role, with support directed towards green manufacturing ecosystems, hydrogen-based steel production, carbon capture technologies and electrified industrial processes.

Rising electricity demand, driven in part by AI infrastructure and data centres, reinforces the need for grid modernisation, including decentralised and bidirectional systems designed to balance regional supply and demand more efficiently.

Governance mechanisms extend beyond infrastructure, incorporating market reforms, green finance instruments and subsidy reallocation away from fossil fuels.

Citizen participation is also embedded through ‘energy income’ models, enabling local investment in renewable projects.

South Korea positions energy transition not only as a climate objective but as a broader economic and social restructuring agenda centred on resilience, competitiveness and public engagement.

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