11. Securing Europe’s Future: Strengthening ICT Competitiveness for Economic and National Security
- Author:
- Fredrik Erixon, Oscar Guinea, and Dyuti Pandya
- Publication Date:
- 12-2024
- Content Type:
- Policy Brief
- Institution:
- European Centre for International Political Economy (ECIPE)
- Abstract:
- Europe’s Information and Communication Technology (ICT) sector, including ICT manufacturing such as telecom equipment and electronic components, as well as ICT services such as software, telecommunication services, and data processing, is no longer merely an economic pillar but a strategic asset essential for national security and defence capabilities. This paper identifies two concerns linking technology and national security: the exploitation of ICT as a gateway to critical infrastructure and the weaponisation of trade and technological dependencies in ICT by foreign nations. Addressing these two challenges requires tailored approaches, as they involve distinct nations and contexts. First, the EU should reduce its reliance on Chinese telecom equipment within its networks and accelerate the deployment of 5G. While phasing out Chinese telecom equipment will take years, a faster rollout of 5G can be achieved in the short term. To accomplish this, the EU should promote the scale and profitability of its telecom operators. Secondly, the EU relies heavily on US companies for a substantial share of its cloud-based online services. However, it is unlikely that the US would impose restrictions on these exports to the EU. Furthermore, replicating the infrastructure needed to deliver cloud-based online services would entail significant costs. To achieve technological leadership, the EU must prioritise emerging technologies such as 6G, XG, AI, quantum computing, and edge and hybrid computing, which will form the foundation of future commercial and military innovations. Thirdly, the EU should strengthen its leadership position in the development of technologies for advanced mobile communication, including 5G, 6G, and XG. Through significant effort and investment in R&D, European companies have secured a leading role in developing technical standards for cellular communication and telecom equipment. Large European firms such as Ericsson and Nokia, as well as EU SMEs that are champions in their fields, are among the most significant contributors to the technological standards. This hard-won position is one that EU policymakers must do their utmost to protect and develop. However, complacency is a recipe for disaster. The EU has the potential to foster companies that could lead in the technologies of tomorrow. It possesses the necessary fundamentals to drive technological innovation in the ICT sector, including high levels of human capital, firms operating at the technological frontier, and a market economy underpinned by strong institutions, the rule of law, and robust intellectual property protections. These constitute Europe’s comparative advantages, and the EU must adopt policies that recognise and reinforce them, rather than undermine them.
- Topic:
- Defense Policy, National Security, European Union, Digital Economy, Trade, and Competition
- Political Geography:
- Europe