SAFE Finance Blog

09 Apr 2019

The German AI Initiative – Much ado about nothing?

Oliver Hinz criticizes the German Artificial Intelligence initiative: "Creating high expectations without fulfilling them, is certainly not a good plan"

Big promises were made last year: “3 billion EUR for a large-scaled Artificial Intelligence (AI) initiative”, “100 new professorships in this area” just to name two of these promises. Although many experts were not satisfied with the extent of these planned efforts and the amount of investments, it seems that policymakers cannot or do not want to deliver on even these promises. So only a few months later, industry and area experts are becoming increasingly disappointed. The Verein Deutscher Ingenieure (VDI) recently published the results of a survey amongst their members which highlight that policymakers are acting not dedicated and fast enough from an industry point of view. It seems thus likely that Germany and Europe, in general, cannot keep up with the developments in the USA and China.

So what happened to the different initiatives? A small article review reveals why so many experts and industry representatives get more and more frustrated. The Handelsblatt reported that the German Government planned to invest only 142 Million Euro (out of 359 billion Euro in total, which is thus 0.04 percent) in 2019 and until 2023 the investments in AI are now planned to be 500 Million Euro in total. A day after the revelation of the planned budget, chancellor Angela Merkel outsourced the problem to the EU by calling for an EU initiative on AI.

In the meanwhile, it has become also obvious that 100 new AI professors in Germany in the next years are rather science fiction than actual policy. I just refer to this article that explains the dilemma and the problems with this endeavor. 

A brain drain of the best talents

Besides the amount of investments, also the specific area of investments has recently been criticized because in particular older and non-sophisticated methods are likely to be funded. The paper on the national AI strategy does – for example – not mention Deep Learning a single time on 47 pages which makes domain experts skeptical.

Frankfurt is also supposed to be an AI hub; at least this was a promise before the election. Until now I had to fill out an Excel sheet on past and recent projects in the area of AI and communication attempts (by colleagues from TU Darmstadt and me) with the government from Hesse have not been fruitful yet.

However, to be honest, at least my colleagues from Bavaria have gladly reported that indeed large investments in their universities have been made (see e.g. here or here). This potentially creates a brain drain of the best talents to Bavaria. Well, this is how competition in a federal republic works.

Overall, this short review of recent developments can certainly help explain the current state of disappointment. If the government decides that we can rest on our laurels for a few more years without investing in our future, Germany and Europe will not play an important role in the world anymore. In all cases, creating high expectations without fulfilling them, is certainly not a good plan for governments and political parties. I personally believe that we need to invest more in data analytics, data-driven decision making and in the education of our young talents in this area.

Oliver Hinz is Professor for Information Systems and Information Management at Goethe University Frankfurt.