Hungarian Companies Stragglers in the Use of Artificial Intelligence

Hungarian enterprises are slow to adapt to the use of Artificial Intelligence (AI) for business purposes as only 3% of local companies use AI in some form. This is less than half of the EU average, putting Hungary on the 25th slot on the list of 27 EU member states. Meanwhile Brussels is working on a new directive to ensure an even more reliable use of technology.

Artificial intelligence (AI) is an area of strategic importance and a key driver of economic development. It can provide solutions to many challenges, such as treating diseases or minimizing the environmental impact of farming. Artificial intelligence gives machines and systems the capability to analyze their environment and make decisions with some degree of autonomy to achieve specific goals. In 2020, a mere 7% of enterprises in the EU with at least 10 employees used AI applications, according to recent data published by Eurostat, the bloc’s statistical office. While 2% of the enterprises used machine learning to analyze big data internally, 1% analyzed big data internally with the help of natural language processing, natural language generation or speech recognition. Another 2% of the enterprises used a chat service where a chatbot or virtual agent generated natural language replies to customers. The same proportion of enterprises used service robots that have some degree of autonomy, for dangerous or repetitive tasks such as cleaning up poisonous substances, sorting items in the warehouse, helping customers in shopping or at payment points.

Big differences
Among the EU Member States, Ireland recorded the highest share of enterprises (23%) that used any of the four considered AI applications in 2020. Other countries with a widespread uptake of AI technologies were Malta (19%), Finland (12%) and Denmark (11%).
In contrast, less than 10% of enterprises used any of the four AI applications in 2020 in all other Member States. The lowest shares were recorded in Latvia (2%), Slovenia, Hungary, Cyprus (3% each) and Poland (4%).

EU Directive on AI
The EU is facilitating and enhancing cooperation on AI across the bloc to boost the union’s competitiveness and ensure trust based on EU values. Brussels’ approach to AI and robotics deals with technological, ethical, legal and socio-economic aspects to increase research and industrial capacity and to put AI at the service of European citizens and economy. The European Commission has already invested significant amounts in artificial intelligence, cognitive systems, robotics, big data and future and emerging technologies to help Europe be competitive. In the 2014-2020 period, EU spending on AI-related areas (robotics, big data, health, transport, future and emerging technologies amounted to about EUR2.6 billion. Going forward, Brussels foresees EUR20 billion per year in combined public and private investment to establish a solid base for AI in the future.
Last week, the European Union (EU) put forth its “Proposal for a Regulation on a European approach for Artificial Intelligence,” intending to create “the first ever legal framework on AI, which addresses the risks of AI and positions Europe to play a leading role globally.”
According to the proposal, “the same elements and techniques that power the socio-economic benefits of AI can also bring about new risks or negative consequences for individuals or society. In light of the speed of technological change and possible challenges, the EU is committed to strive for a balanced approach […] Rules for AI available in the Union market or otherwise affecting people in the Union should therefore be human centric, so that people can trust that the technology is used in a way that is safe and compliant with the law, including the respect of fundamental rights.”
The proposal is based on EU values and fundamental rights and aims to give people and other users the confidence to embrace AI-based solutions, while encouraging businesses to develop them. AI should be a tool for people and a force for good in society with the ultimate aim of increasing human well-being.

Specific objectives
The Commission’s proposed regulatory framework on AI seeks to ensure that AI systems placed on the Union market for use are safe and respect existing law on fundamental rights and Union values. Additionally, it is designed to ensure legal certainty to facilitate investment and innovation in AI and facilitate the development of a single market for lawful, safe and trustworthy AI applications and prevent market fragmentation.
The proposed regulations address the human and societal risks associated with specific uses of AI, such as mass surveillance and biometric identification in public places. The draft regulations also include rules for uses of AI in some risky categories such as choosing schools, jobs or loan applicants, while banning it outright in cases such as "social scoring" or systems used to manipulate human behavior.
Though regulators and innovators may not exactly know yet how this proposal will impact the development and use of AI in real terms, it will likely create some sort of precedent and framework moving forward.