CHALLENGES OF DIGITAL TRANSFORMATION AND THEIR CONSEQUENCES FOR THE FINANCIAL AND ECONOMIC DEVELOPMENT OF EU COUNTRIES
Digital transformation shapes the current course of economic development in the European Union. It strengthens the competitiveness of economies and stimulates innovation and labor productivity. However, digitalization also carries the risk of uneven development between countries and sectors. Issues of digital maturity, security, and sustainability are particularly important. The aim of this study is to provide an in-depth analysis of the challenges arising from the digital transformation for the European Union economy. It also assesses the impact of digitalization on financial and economic development. The study covers technological, institutional, social, and financial aspects of digitalization. The methodology is based on statistical, econometric, and scenario analysis. Panel models, the DSGE approach, and system dynamics modeling were used.The significant positive impact of digitalization on the economic growth of the Member States was revealed. The acceleration of labor productivity due to the introduction of modern digital technologies was analyzed. The emergence of a digital core between the countries of Northern and Western Europe was investigated. The existence of digital asymmetry between different Member States of the European Union was confirmed. The connection between digital transformation, innovation, and sustainable economic development was established. The positive impact of digital maturity on the macroeconomic competitiveness of countries was investigated. The existence of threshold effects of digitalization on economic efficiency was emphasized. Prospective scenarios for the digital development of the European Union until 2030 are proposed.This study confirmed the systemic nature of the digital transformation of the economy. Digitalization is a significant driver of economic growth and convergence. However, the risk of digital inequality and technological dependence remains. The effectiveness of these transformations depends on the institutional capacity of countries and investments. Developing digital skills among the population and infrastructure remains a priority, although cybersecurity, innovation, and coordinated digital policies are also important.