The New Frontier Foundation (NFF) is pleased to announce its contribution to 2025 Dubrovnik Forum, Croatia’s most important strategic conference, organized by the Croatian Government (Ministry of Foreign and European Affairs). NFF, in the second year since its inception, had the distinct honor of collaborating with the Ministry to organize and chair a panel discussion titled “How AI Can Enhance European Competitiveness” within the Forum’s official program. This collaboration underscores NFF’s commitment to fostering critical dialogues and enhancing the quality of strategic discussions in Croatia. Panel discussion report is published here.

The panel’s primary goal was to explore the requisites for a successful transition into the AI age, emphasizing collaboration among all stakeholders – governments, the private sector, and researchers – to leverage AI as a powerful tool for strengthening European competitiveness. The dialogue aimed to deepen understanding of this vital topic, fostering innovation and empowering citizens to confidently utilize technology.

Moderated by Natko Vlahović, Chairman of the New Frontier Foundation, the panel featured a distinguished lineup of experts:

• Ivan Crnčec, State Secretary in the Ministry of Justice, Public Administration, and Digital Transformation of the Republic of Croatia.
• Hendrik Bourgeois, Head of Europe Government Affairs at Mastercard Europe.
• Stjepan Roglić, Vice-President of the Supervisory Board, Orbico Group.
• Cezara Panait, AI Policy Lead CEE, Government Affairs and Public Policy, Google.
• Professor Mihael Mudrić, PhD, Faculty of Law, University of Zagreb.

Key Insights from the Panel Discussion:

AI’s Economic Potential for Europe:
Cezara Panait from Google highlighted AI’s capacity to boost Europe’s productivity and economic growth, particularly in Central and Eastern Europe. She presented Google-commissioned findings suggesting that if Croatia fully adopts generative AI, its GDP could increase by 5%, adding an estimated 3 to 4 billion euros to its economy. This would also augment one million Croatian jobs, making tasks more efficient, rather than replacing them. Panait stressed the urgency for Europe to embrace AI to strengthen competitiveness, increase efficiency, and promote trustworthy and ethical AI practices, urging the CEE region to actively participate in AI regulation discussions.

Croatian Government’s Strategic AI Approach:
Ivan Crnčec detailed Croatia’s strategic documents for AI development, including the “National AI Development Plan for the period until 2032” and an accompanying action plan for 2026-2028. He mentioned a broad expert working group involved in this initiative, expecting both documents to be finalized by year-end. Crnčec also revealed an exclusive development: Croatia is amending its penal code to introduce a new criminal offense covering the criminal liability of AI, initially for automated vehicles but designed to be broader, covering commission or omission in the development, testing, use, and management of AI systems. This pioneering effort aims to address serious consequences such as bodily harm, property damage, or death.>

The Critical Need for AI Literacy and Responsible Use:
Professor Mihael Mudrić emphasized the urgent need for comprehensive AI education from kindergarten to the workplace, citing challenges like public servants unknowingly uploading sensitive documents to public AI tools. He underscored that users are ultimately responsible for AI tool output, necessitating education for critical evaluation of AI-generated content.

Industry Perspectives:
Hendrik Bourgeois from Mastercard highlighted AI’s criticality for European competitiveness, especially for SMEs, noting its role in preventing Europe from falling behind in global productivity. He stressed AI’s importance in maintaining trust within Mastercard’s global payments network, processing 169 billion transactions annually and using AI for fraud prevention.

Stjepan Roglić of Orbico Group emphasized the need for local companies to implement global AI solutions and innovations, acknowledging the rapid pace of technological change. He expressed hope for a more innovation-conducive environment in Europe, noting the crucial interplay between the private sector and government in AI development and regulation.

Regulatory Challenges and Global Outlook:
The discussion also addressed regulatory hurdles, with Panait warning that the EU’s AI Act and other digital regulations could disproportionately affect SMEs and unicorns, potentially hindering innovation. Bourgeois acknowledged the negative impact of increased economic protectionism on global business and highlighted the challenge of policy uncertainty. Roglić underscored the business community’s desire for stability and a secure environment for growth, particularly in Eastern Europe and Ukraine.

The panel delivered a resounding message: Europe’s competitiveness in the age of AI hinges on a concerted, collaborative effort, encompassing strategic national planning, continuous investment in research and infrastructure, widespread education, and a regulatory environment that intelligently balances innovation with safeguards. By embracing these principles, Europe can enhance its competitiveness and empower its citizens to confidently utilize AI as a beneficial tool for decades to come.