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From the discovery of earths place in the solar system to the invention of the plane, photography, or the internet: history is full of examples where scientific and technological progress was initially held back by fear.

Recent calls to pause the development of advanced artificial intelligence (AI) systems more powerful than the Generative Pre-trained Transformer 4 (GPT-4) model for at least six months are therefore no surprise. And while there are valid concerns about the potential risks of AI, it is already well understood that the overwhelming benefits of continued innovation in this field will outweigh potential risks.

Instead of hitting the brakes on AI innovation, EU policymakers should hit the accelerator on smart AI regulation. In this respect, the European Union has already taken a step in the right direction with its risk-based AI Act that is currently going through parliament.

Nevertheless, with ChatGPT and other innovative AI-powered tools making headlines, the focus of the debate is often on alarmist stories which tend to overlook the many societal benefits. For example, AI can help people with disabilities to access services more easily, or enable healthcare professionals to diagnose and treat patients more accurately and efficiently. Continued research and innovation is likely to unlock new solutions to the worlds most pressing problems, including climate change and pandemics.

Yet contrary to some alarmist claims, AI will not replace or substitute humans. What it holds is the potential to empower people in many different ways. In its early days, photography was also feared to replace the art of painting, so it is understandable that some are concerned with AI. But just like any other technology, AI first and foremost remains a tool developed and controlled by humans.

Putting a brake on research and innovation in AI will not only deprive society of all its benefits, but also jeopardise the development of many other technologies. This, in turn, will result in a distinct competitive disadvantage for countries or regions in the EUs case that choose the regressive path instead of going forward.

As recently pointed out by Bruno Sportisse, CEO of the French National Institute for Research in Digital Science and Technology, all digital innovations are in fact intertwined today. The future of cybersecurity also lies in the development of AI algorithms to automatically detect and respond to attacks, which is key to the controlled spread of the cloud.

This means that everything from cybersecurity to cloud and quantum computing is heavily dependent on developments in artificial intelligence, which is powering current and future innovations in all these fields. As European policymakers discuss the blocs new AI Act, the first of its kind in the world, they should therefore focus on promoting the safe and responsible use of AI technology and not on that brake.

The risk-based approach of the new regulation will impose rules on providers and users of AI systems, depending on the risks a particular AI application poses. For example, end users will have to be informed when they are interacting with an AI system and regulatory sandboxes will be introduced, allowing developers to create and test their systems in safe environments in collaboration with regulators.

These EU rules will thus protect consumers and provide useful guidance for developers. Although the AI Act can still be further improved in order to unlock AIs full potential, the current proposal already properly addresses the risks posed by AI and will improve trust. Combined with strong innovation and education policies, Europes new rulebook will help society to safely leverage the huge potential of AI.

While the EU is at the forefront of AI regulation in the world, some still argue that these European rules come too late. But it is wrong to think that states and society are not equipped to deal with new technological innovations. Not only does the EU already have an extensive regulatory framework for the digital sector that also applies to AI, including the General Data Protection Regulation (GDPR), but companies and AI labs themselves are adhering to strict rules when it comes to developing and deploying AI.

OpenAI, the creator of ChatGPT, for example, is strongly committed to developing trustworthy and responsible AI, and to that end works together with industry players and policymakers. Other companies that lead on AI innovation, such as Google and Meta, have introduced AI principles and pillars of responsible AI, respectively, which they are committed to uphold.

If there is one conclusion that we can draw, it is that there is a compelling case for steering towards more, not less, innovation in AI. As scientific and technological breakthroughs will continue to emerge at an increasing pace in the coming years, regulators, policymakers, and society at large should embrace a more progressive approach.

The EU should not be fixated on what is making headlines today, but rather focus on ensuring we create a regulatory framework that is ready for the future, which will bring about innovations that we are not even able to grasp yet.

Just like our generation with its pocket-sized camera phones now has to laugh at the thought that the earliest room-sized cameras were seen as an existential threat to painters like Rubens or Michelangelo, future generations will be wondering what Europe was thinking when it briefly considered a freeze on the development of those very first room-sized AI applications.

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Instead of Hitting the Brakes on AI, the EU Should Embrace Smart ... - Disruptive Competition Project

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Recent news reports have suggested that the European Union Parliament will likely retain treatment of certain trade finance instruments at a credit conversion factor (CCF) of 20% instead of increasing it to 50%, but trade finance specialists tracking the ongoing proceedings have said that the EU banking community needs to remain extremely cautious.

Christian Cazenove, group head of trade oversight at Societe Generale, is part of the coalition of bankers who have enlisted the help of corporates under the umbrella of the ICC (International Chamber of Commerce) and drawn from solid industry data to make the case to EU policymakers that hiking the CCF to 50% for performance-related trade finance instruments such as bonds, guarantees, and standbys is unwarranted and would be deleterious for corporates, competitiveness, and ultimately national economies.

In late October 2021, the EU Commission launched a Capital Requirements Regulation (CRR3) proposal, which included provisions to raise at 50% the CCF for performance guarantees and set fixed maturity at 2.5 years for all trade finance instruments as part of the much broader movement to implement Basel III capital adequacy reforms.

This unwelcome development prompted a small coalition of banks within the EU to band together along with corporates, Global Credit Data (GCD) and Fleishman-Hillard agency under the ICC to gather compelling data and initiate an effort to convince the EU to reconsider.

Since mid-April 2022, the coalition has conducted over 70 meetings with EU member states, the European Council, and other EU governmental bodies.

By November 2022, the Council adopted the text and agreed to consider the coalitions amendment to keep the CCF at 20% and an effective maturity rate for trade finance products.

In January 2023, the European Parliaments Economic and Monetary Affairs Committee decided to maintain the 20% CCF for off-balance sheet trade finance instruments. The EU trialogue (EU Commission, Council and Parliament) is expected to take up the matter in early March 2023.

Cazenove said, When we discussed the issue, the (European) Council said they would not oppose the amendment, but we are still far from the final outcome and must leave member states do their role.

Sweden holds the Presidency of the Council for the first half of 2023 and indications are that the issue would be settled before the end of their leadership.

To get more appropriate treatment of performance-related trade instruments this far was only possible with the backing of corporates and robust data.

If it was only the banks, it would have been too tough, Cazenove explained to DCW. It was important to gather corporates because a move (of the CCF) from 20% to 50% would have a huge impact on risk weighting for the banks and a massive impact on pricing for corporates. But a worst-case scenario would be banks cutting many credit lines, preventing small/middle-sized corporates from having access to credit from banks. Thats whats at stake.

To illustrate the pricing shock users of performance-related trade products could face if the CCF was increased to 50%, Cazenove cited an example from a December 2021 ICC paper on the treatment of trade finance assets under the proposed CRR3. This report demonstrated the potential impact on corporates needing performance guarantees to develop infrastructure projects (like building a road or an energy station) or participate in a tender.

In the scenario given, Company A delivers work to Company B (beneficiary), with a duration of 1 year and Company B is covered by a Performance Guarantee for 100 million. It has been estimated that the RWA (Risk Weighted Asset) resulting from an increase of CCF would reach 7.4 million (CCF 50%) compared to 2.9 million (CCF 20%).

In total, the new 50% CCF proposed could cause a price increase of 150%, raising the cost to 330,000 instead of 130,000 for Company A.

Corporates from the manufacturing, transportation, and energy sectors, along with large industrial companies, aligned with the coalition of banks to push back against the proposed CCF increase. The coalition relied on statistical evidence obtained from Global Credit Data and the ICC Trade Register to demonstrate that trade finance products are a lower-risk asset class.

This article was originally published in Documentary Credit World (DCW), published by the Instituteof International Banking Law & Practice.

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EU Banks, Corporates Cautiously Optimistic While Awaiting Decision on Treatment of Trade Finance Products - Trade Finance Global

PRAGUE, April 11 (Reuters) - Czech Finance Minister Zbynek Stanjura is considering an increase in the value-added tax (VAT) rate on beer in a major overhaul of the VAT regime, part of government efforts to cut the deficit.

The reforms would combine the current two lower VAT rates of 10% and 15% into a 14% rate, while maintaining a top level of 21%, the Finance Ministry said on Tuesday.

The ministry did not list all the items which could see VAT rates increase, but Czech TV, which first reported the plans on Monday evening and called them the biggest VAT changes in eight years, said hotels, beer, water and sport could see an increase.

Stanjura told Czech TV that beer would be among items moved to a higher bracket and that items would be judged on whether "there is a societal reason to consume more of these services".

A rise in the tax on beer could be the most eye-catching tax move in a country with one of the highest per-capita beer consumption rates in the world.

A half-litre of top-selling brand Pilsner Urquell typically costs around 60 Czech crowns ($2.79) in Prague, so an increase in VAT to 21% from 10% could lead to a 6.6 crowns rise in the retail price.

The VAT changes overall could raise 24 billion crowns ($1.12 billion) for the budget next year, Czech TV said.

The finance ministry estimated that combining the lower rates would lift budget revenue by a single-billion crowns figure, while shifting some lower-taxed items into the higher rate would boost income by the low tens of billions.

The VAT adjustments were part of a wider budget consolidation package still to be negotiated by the five-party, centre-right coalition government, it said.

Prime Minister Petr Fiala also said plans published in the media were not final.

"I will personally announce final proposals on the topic of lowering the budget deficits (resulting) from expert and political debates in about a month," Fiala said.

"Our coalition wants to look for potential savings primarily on the side of the state and only after that in people's pockets."

Czech TV reported that under the changes, services like lodging, water, sport and cultural activities that are currently taxed at lower rates would move into the 21% bracket.

The government is looking for around 70 billion crowns in budget savings or indirect tax increases to cut next year's deficit from a planned 295 billion crown gap this year, seeking to do its part to quell inflation running above 16%.

The government took power at the end of 2021 aiming to rein in debt levels that remain well below European Union averages but have grown in recent years at one of the fastest rates in the bloc.

But higher spending needs due to Russia's invasion of Ukraine and state aid necessary to ease the impact of soaring energy costs have hit its plans.

The central state budget gap should fall by 65 billion crowns in 2023, although the overall fiscal gap is expected to rise to 4.2% of gross domestic product, remaining above EU rules, according to ministry forecasts.

($1 = 21.5190 Czech crowns)

Reporting by Jason Hovet and Jan Lopatka; Editing by Nick Macfie, Angus MacSwan and Jan Harvey

Our Standards: The Thomson Reuters Trust Principles.

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The VET for the Future project in Ganja, Azerbaijan, recently organised a two-day training course aimed at enhancing career services in vocational education and training in Azerbaijan.

The project is funded by the European Union and implemented by the United Nations Development Programme (UNDP) and the State Agency on Vocational Education (SAVE).

The training helped to equip existing career centre professionals with up-to-date knowledge and skills in the field and to strengthen their working capacity. The event brought together 25 people including 15 career specialists from Baku, Barda, Jalilabad, Ganja and Gabala, experts from the Education Institute of the Republic of Azerbaijan and the European Training Foundation, as well as coaching specialists and representatives of the organising parties.

Four career centres have so far been established under the project. Over the last 18 months, 13 career advisers from these centres provided around 1,000 career counselling services. Sixty per cent of the users of the career services are men and 40% are women.

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Press release

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EU and UNDP support expansion of career services in vocational ... - euneighbourseast.eu

Feeling safe and being social are crucial for children in times of war. Kindergarten children in Slavutych, in northern Ukraine, will be safe in a bomb shelter that was restored and equipped by the United Nations Childrens Fund (UNICEF).

It is one of 56 facilities in Ukraine that has been rehabilitated to provide a safe haven for kindergarten and school children thanks to EU humanitarian funding and other donors. Protecting the most vulnerable.

Children in the EU-funded shelter in northern Ukraine can socialise and stay safe.

UNICEF

Previously, bomb shelters did not exist in the Slavutych kindergarten, and children and teachers were forced to hide behind walls during air alarms.

Now, children spend their rest hours in the shelter, which was specially equipped just over a month ago to protect them during air alerts and missile attacks.

Not long ago, this colourful and bright shelter was a dark and cold basement, providing no safety or comfort for children.

UNICEF

"We are going to visit an ant," says 5-year-old Maksym, clutching a toy as he follows his friends and teachers down the stairs. As he enters the shelter, he finds a bright, spacious room with drawings of ants on the walls.

There are currently 112 children who attend the kindergarten, and the shelter is designed for 220 people. According to the teachers, rest hours are best spent in the shelter for childrens sleep not to be disrupted during air alarms.

While the kindergarten was closed, Oksana and her colleagues guarded it, but then decided to return to work to support the children.

UNICEF

"While half awake, each child reacts to an air alarm differently, that's why we decided to have the rest hour in the shelter, says teacher Oksana.

Instead of saying we are going to the shelter, we told children from the very beginning we are going to visit an ant. It's our favourite character, she explains.

Following the start of Russias full-scale war on Ukraine in February 2022, the kindergarten in Slavutych remained closed for months until it was finally able to reopen its doors in the end of August. Yet, teachers at the kindergarten say the fear is still very real.

"We try to hold on and not to show the children that we are worried, says Oksana. We hope for the better. When the kindergarten was closed, we guarded it and then decided to return to work, because children need to socialise.

Now the children have a safe and comfortable place to play and socialise.

UNICEF

In the kindergarten, children can play in a safe environment. Parents, too, can relax in the knowledge that the new shelter protects their children.

For children to continue attending schools and kindergartens, UNICEF and partners are rehabilitating shelters and rebuilding schools in the most affected areas of Ukraine. Currently, 56 facilities have been restored.

The implementation of this programme is possible thanks to the support and funding of the European Union and USAID. In addition, UNICEF provides necessary supplies and materials for various activities and for the comfort of children in shelters.

Story by UNICEF.Publication date: 13/04/2023

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From darkness to light: how Ukrainian children find comfort and ... - Humanitarian Aid