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1. Benchmarking Quantum Technology Performance: Governments, Industry, Academia and their Role in Shaping our Technological Future

Author:
Fredrik Erixon, Andrea Dugo, Dyuti Pandya, and Oscar du Roy
Publication Date:
03-2025
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
In this study on the transformative potential of quantum technology in reshaping economies, we present results and evidence drawing on a unique and innovative quantum dataset compiled by ECIPE. This data offers new insights into the current state of quantum advancements. This comprehensive database sheds light on the roles of various actors – governments, industry, and academia – showcasing their contributions to the development of quantum technologies. By grounding the analysis in real data, we provide a clearer understanding of the dynamics at play, enabling stakeholders to assess the sustainability of quantum technology progress and foster an ecosystem that supports both public and private sector involvement.
Topic:
Science and Technology, Digital Economy, Private Sector, Industry, and Quantum Computing
Political Geography:
Global Focus

2. India and the World Economy: Policy Options at a Time of Geopolitical Drama, Technological Shifts, and Rising Protectionism

Author:
Fredrik Erixon, Dyuti Pandya, and Vanika Sharma
Publication Date:
03-2025
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
What trade policy should India pursue? Geopolitical drama and a faltering multilateral system have made choices of trade policy harder for many countries. Rising protectionism, economic nationalism, and growing scepticism towards globalisation eat into most trade relations. Technology-driven innovation and rapid changes in the composition of trade have added additional layers of complexity, forcing governments to develop new policies for cross-border economic integration. This is the inflection point for India’s trade policy: its traditional approach is increasingly unable to respond to new economic and political realities, and new approaches may be needed to deliver better economic outcomes. Using India’s external trade strategy as a starting point, this policy brief presents three strategic options for India, each reflecting varying degrees of trade openness as a means to drive economic development. Using categories from the world of soft drinks, we call them “Trade Zero”, Diet Trade” and “Trade Regular”. First, the Trade Zero approach allows India to maintain its defensive stance on trade, focusing primarily on the growth of its domestic market and demand. Trade only serves as a means to manage production surpluses. Second, the Diet Trade approach pushes India to softly enhance trade with its already well-established trading partners, ideally by focusing on high-value-added goods and services. The model emphasises deepening diplomatic relations through trade: however, not at the cost of domestic policy priorities. And lastly, the Trade Regular approach encourages the adoption of a more ambitious trade strategy with the aim of establishing India as a central hub connecting major global economic regions. This would happen through upgrading existing trade agreements, signing new multilateral trade agreements, as well as adopting significant domestic reforms for further economic liberalisation. India’s trade performance provides the actual context of the realities of India’s trade policy. There are some notable features in India’s trade performance: its trade sector is small (international trade as a share of the GDP); it has a large services export sector compared to the export of goods; exports of high-value added goods and services has increased substantially; there is a consistently large share of big economies such as the United States and the European Union in India’s exports. All these features point to India’s position in global trade as a relatively high-value added economy. India, therefore, not only has an opportunity to leverage its trade capacity to significantly improve economic growth but can also adapt to newer forms of trade and increasingly engage with the global economy. Moreover, given the shifting global context and the increasing trade reciprocity demands from larger economies, India will also need to strengthen its trade relations with a diverse set of partners. In a way, India’s economy has already made the choice of which model that suits it best. Given the key features of the country’s trade sector, India’s real economy is already moving towards a Trade Regular model. However, there is a gap between the actual performance and policy positions, which remain defensive. Future trade growth, however, will likely depend on India becoming more pro-active in its trade policy and better equipped to negotiate trade agreements that respond the ambitions of its outward-oriented companies.
Topic:
Science and Technology, Geopolitics, and Trade Policy
Political Geography:
South Asia and India

3. EU Export of Regulatory Overreach: The Case of the Digital Markets Act (DMA)

Author:
Matthias Bauer, Dyuti Pandya, and Vanika Sharma
Publication Date:
04-2025
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The EU’s Digital Markets Act (DMA) exemplifies the “Brussels Effect,” extending the EU’s regulatory influence beyond its borders and shaping global digital competition policies. While intended to curb the market power of large technology platforms and promote fair competition, its broad, rigid, and pre-emptive approach risks stifling technological development, deterring investment, and creating legal uncertainty, particularly in emerging markets still building digital infrastructure and seeking to attract foreign investment. Large technology firms play a pivotal role in global economic development, driving innovation, infrastructure upgrading, and consumer welfare. However, increasing regulatory scrutiny, particularly under DMA-like frameworks, could inadvertently harm the very markets they help grow by imposing compliance burdens that hinder business expansion and technology diffusion. Countries with weaker institutions and regulatory capacity – such as India, Brazil, South Africa, and other emerging market and developing economies (EMDEs) like Indonesia – could face greater risks of regulatory capture, corruption, and enforcement challenges if they replicate the EU’s approach without adapting it to their economic realities (Section 2). A key concern with the DMA is the departure from traditional case-by-case enforcement in competition policy, instead relying on broad, pre-emptive obligations based on ambiguous concepts such as fairness and contestability. This shift reduces legal certainty, increases the risk of inconsistent enforcement, and may inhibit dynamic competition, which is essential for innovation-driven sectors like fintech, e-commerce, ICT, and edtech. By prioritising static over dynamic competition, the DMA could impede technological progress, limiting consumer choice and long-term economic benefits (Section 3). The global adoption of DMA-like regulations risks further regulatory fragmentation and may create unintended consequences, particularly in emerging economies where regulatory frameworks, institutional quality, and market structures differ significantly from the EU. Broad prohibitions on business practices, such as self-preferencing and data-sharing, could limit opportunities for local firms to scale internationally, weaken cybersecurity protections, and reduce incentives for large technology firms to invest in these regions (Section 4). To ensure proportionate and effective competition enforcement, governments outside the EU should prioritise regulatory flexibility and case-by-case assessments over broad, static restrictions. OECD best practices on competition policy emphasise clear objectives, legal certainty, and regulatory proportionality, ensuring that competition enforcement supports, rather than stifles, innovation and investment (Section 5). Moreover, the risks of corruption and regulatory overreach in developing countries make broad ex-ante regulations especially problematic. Excessive discretionary power granted to local authorities could increase the risk of politically motivated enforcement, deter foreign investment, and undermine long-term economic growth. A more effective approach would be to strengthen institutional frameworks, enhance transparency, and adopt supply-side policies that support technology neutrality, free trade, and economic freedom.
Topic:
Science and Technology, European Union, Regulation, Digital Markets Act (DMA), and Economic Competition
Political Geography:
Europe

4. Calling on the EU-US Trade and Technology Council: How to Deliver for the Planet and the Economy

Author:
Oscar Guinea, Vanika Sharma, Philipp Lamprecht, Dyuti Pandya, and Oscar du Roy
Publication Date:
02-2024
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
This Policy Brief proposes the establishment of an agreement on conformity assessment between the EU and the US that covers machinery and electrical equipment. The initiative aims to increase the number of European and US conformity assessment bodies authorized to test and certify EU and US machinery and electrical equipment for exports into each other’s markets, without recognizing the equivalency or otherwise altering the product requirements in regulation, standards, or other normative documents on either side. While this study focuses on the economic effects of an agreement on conformity assessment that includes machinery and electrical equipment, the scope of such an agreement could potentially be extended to several additional product categories, particularly those that are subject to requirements for mandatory third-party conformity assessment in both the EU and the US. The increase in the number of conformity assessment bodies is expected to reduce the costs and the time required to demonstrate conformity. If this policy succeeds as expected in achieving a reduction in trade costs between 2 and 6 percent, US exports to the EU are projected to increase between US$ 11 billion and US$ 32.5 billion while EU exports to the US are estimated to grow by between US$ 13.8 billion and US$ 42.2 billion. In percentage terms, US firms are anticipated to experience a larger increase in exports of machinery and electrical equipment than their EU counterparts. The increase in trade flows as a result of this agreement is estimated to be larger than the rise in trade flows achieved in other Free Trade Agreements signed by the EU or the US. Moreover, as an increasing number of EU regulations begin to mandate third-party conformity assessment, US firms will increasingly benefit from this agreement when exporting to the EU. Given China’s status as the largest supplier of machinery and electrical equipment to both the EU and the US, the implementation of an EU-US agreement on conformity assessment would not only improve conditions for transatlantic trade but also lead to reduced trade dependence for the EU and the US on China. The reduction in trade costs between the EU and the US on machinery and electrical equipment due to the agreement could lower Chinese exports to the EU and the US by between US$ 6.5 billion and US$ 19.4 billion. Importantly, machinery and electrical equipment are crucial inputs for some of the key technologies in which the EU and the US Administrations have identified trade dependencies on China. However, in contrast with other policies aimed at reducing reliance on Chinese imports, an agreement on conformity assessment for machinery and electrical equipment will not require public subsidies or impose any financial burden on taxpayers. This agreement also has the potential to benefit the environment. Machinery and electrical equipment are essential inputs for green technologies. Therefore, a reduction in the cost and time of conformity assessment in these industries will accelerate the adoption of green technologies. An agreement on conformity assessment between the EU and the US covering green goods and clean technologies could increase transatlantic exports between US$ 3.1 billion and US$ 9.2 billion. While this increase in exports is significant, broadening the scope of the agreement to include the entirety of machinery and electrical equipment, rather than just a subset, is projected to lead to trade effects eight times larger. Moreover, as green technologies rapidly evolve, an agreement on conformity assessment has the potential to serve as a dynamic instrument that evolves to accommodate future regulatory and economic developments on climate and the environment on both sides of the Atlantic.
Topic:
Science and Technology, European Union, Economy, and Trade
Political Geography:
Europe, North America, and United States of America

5. Enhancing Technology Diffusion in the EU amid Tough Structural Challenges

Author:
Matthias Bauer, Elena Sisto, and Oscar du Roy
Publication Date:
09-2024
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
To remain globally competitive, the EU must empower firms to adopt the best technology solutions available on global markets. Building on a strong tradition of innovation, the EU relies on corporations across industries to drive the diffusion of technology through the commercialisation of technological innovations. Technology diffusion is crucial for embedding new technologies into society and is essential for sustaining industrial competitiveness. EU and Member State governments must prioritise enhancing the EU’s “diffusion capacity” – the ability to effectively spread and adopt innovations across Member States.
Topic:
Science and Technology, European Union, Digital Economy, and Services
Political Geography:
Europe

6. Trade, Jobs and Technological Change: What to Expect in the Next Five Years?

Author:
Lucian Cernat
Publication Date:
01-2024
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
This Policy Brief explores the intertwined effects of trade and technological change (notably robotics and AI) on employment, highlighting a growing divergence between the number of jobs supported by exports and the declining labour intensity of exports in recent years. The decline in labour intensity may be sharply accelerated by the rise of robotics and the automation of routine tasks, displacing workers in manufacturing and logistics while enhancing productivity. For many countries that have a strong dependence on the trade-jobs nexus, the historically declining labour intensity of exports combined with the rapid adoption of robotics in key economic sectors, will mean that industries could now rely on fewer workers for their exporting activities. This dual shock suggests that, in the future, the number of jobs that depend on trade may decline. The convergence of these forces may lead to certain sectors or regions bearing the brunt of such potential labour disruptions. To address these challenges, supporting policies will be required to mitigate these adverse effects.
Topic:
Globalization, Science and Technology, Digital Economy, Trade, and Artificial Intelligence
Political Geography:
Global Focus

7. The Economic Dividend of Competitiveness

Author:
Fredrik Erixon, Oscar Guinea, Philipp Lamprecht, Elena Sisto, and Erik van der Marel
Publication Date:
03-2023
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
In a world of technological and economic rivalry, the EU must devote increased attention to its competitiveness. Higher levels of competitiveness will help the EU build a more prosperous economy which will in turn produce innovation and resources to address the great challenges of our time. ECIPE published a study presenting a competitiveness compass with concrete policy recommendations that will improve EU’s competitiveness. These policy recommendations, once implemented, will bring tangible benefits to the EU economy in the form of higher levels of trade and productivity. This report presents five scenarios in which the EU pursues competitiveness policies that lead to higher economic growth.
Topic:
Economics, Science and Technology, European Union, Economic Growth, and Competition
Political Geography:
Europe

8. The Economic Impacts of the Proposed EUCS Exclusionary Requirements: Estimates for EU Member States

Author:
Matthias Bauer and Philipp Lamprecht
Publication Date:
10-2023
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The EU Agency for Network and Information Security (ENISA) is proposing a far-reaching “European Cybersecurity Certification Scheme for Cloud Services“ (EUCS) to be established in the European Union (EU). According to the latest draft of August 2023, leaked by Politico in September 2023, the proposed EUCS would by design prevent non-European vendors from providing “high assurance level” cloud services in the EU. In this study, we show that the proposed “immunity” requirements, i.e., foreign ownership and headquarter restrictions, local staff requirements, and data localisation would lead to significant losses in Member States’ aggregate economic activity and drive a big wedge between economic growth in the EU and the growth of non-EU economies. The projected losses in annual EU GDP will vary from EUR 610 billion to EUR 29 billion within approx. two years of implementation, contingent upon the specific sectoral coverage of high-assurance use cases under the cloud service evaluation level CS-EL4. The results fit into the overall picture of EU digital policy, which has weakened rather than strengthened the competitiveness of EU industries in the past. Our findings align with the broader impacts of EU digital policy, which runs the risk of exacerbating the growth gap and technology disparity between the EU and other advanced economies. Cloud services have become increasingly popular and integral to Europe’s economy. Cloud services are granting businesses of all sizes equal access to global data and resources, stimulating collaboration, and bolstering competitiveness. Advanced cloud services are levelling the playing field in domestic commerce and international trade. Smaller enterprises can harness advanced IT capabilities, particularly cloud-based supply chain management, to streamline their operations. Cloud computing solutions are also playing a crucial role in modernising public services, offering transformative potential for government administrations and service quality. Cloud services adoption is expected to grow substantially in the years ahead, driven by data analytics, AI applications as well as quantum and edge commuting solutions. The global cloud computing market is on a rapid growth trajectory and is expected to reach some EUR 2,080 billion by 2030. Industry forecasts indicate that cloud services and transversal cloud-based technologies like AI applications, quantum, and edge computing will experience consistent growth in innovation and are increasingly finding broader applications across various industries. Overall, the global market for IT services is highly competitive and dynamic, with global cloud service providers competing against a broad range of IT service providers of varying scale, including on-premises hardware vendors, private and co-located data centre providers and software providers. Despite showing a trade deficit in international cloud services trade, trade in ICT and digitally enabled services is not a one-way-street for the EU. Recent trade data reveals that the total value of EU exports in digital and digitally enabled services to the rest of the world is roughly equivalent to the total value of EU imports from the rest of the world. This balance in trade is also observed in EU digital trade with the US, where EU exports of ICT services to the US nearly match US exports of digital services to the EU. The proposed EUCS exclusionary requirements entail various negative consequences. As recognised by the European Commission’s latest progress report on digitisation in the EU, European companies have yet to reach the “Digital Decade” targets, especially when it comes to embracing cloud-supported technologies such as AI and big data, as the adoption of digital technologies remains significantly below these objectives.[1] Exclusionary requirements would create operational inefficiencies and increased production costs for cloud services providers and cloud adopters. They would undermine investments in the domestic economy, resulting in reduced international trade, competition, and innovation. The imposition of exclusionary requirements by the EU could create a domino effect of restrictions caused by retaliation and protectionism. Data localisation and nationality requirements stifle innovation and competition, particularly in data-driven industries. The creation of redundant capacities in the EU would have adverse environmental impacts, including increased energy consumption, land use, and electronic waste. Immunity requirements would increase rather than mitigate cybersecurity risks, creating a security deficit for EU cloud adopters that lose access to proven global risk detection and prevention solutions. This study provides estimates of potential GDP and industry output effects from the implementation of exclusionary requirements under the proposed EUCS framework.[2] It is shown that the strict “immunity” requirements in the EUCS cybersecurity certification framework would severely limit European customers’ access to advanced technologies, innovation and global ICT industry growth trends. The study’s findings highlight the significant economic consequences of potential restrictions on access to global cloud services across three scenarios of different sectoral coverage. It is shown that even in the least restrictive scenario, where “immunity” requirements would only be applied to a narrow spectrum of sectors and highly critical use cases, the reduction in the EU’s annual GDP could be substantial. In scenario 1 (broad critical sector coverage), reflecting political demands of the current French government, the EU’s annual GDP is projected to decrease by 3.9% when accounting for lost cloud capacities and forgone cloud capacity and productivity growth, within 2 years of implementation. For scenario 2 (medium critical sector coverage) and scenario 3 (narrow critical sector coverage), the estimated annual losses in GDP amount to -2% and -0.2%, respectively. In terms of current EU GDP, annual losses would amount to EUR 610 billion, EUR 317 billion, and EUR 29 billion, respectively, underscoring the significant magnitude of the potential impacts. For the broad critical sector coverage scenario, our results also show that the EU’s annual GDP losses accumulate over longer periods of time. After 5 years following the implementation of exclusionary EUCS requirements, the annual growth losses for the EU and its Member States remain significant. This is due to the inability of European businesses and the EU’s public sector to tap into the worldwide innovation and productivity gains offered by globally accessible technologies and services. For the EU, we estimate the annual GDP loss to be -3.6%, with a trend to further accumulate in subsequent years.
Topic:
Science and Technology, European Union, Cybersecurity, Digital Economy, and Digitization
Political Geography:
Europe

9. The Imperative of International Cooperation for EU Competitiveness and Resilience in Technology-Driven Industries

Author:
Matthias Bauer, Renata Zilli, and Dyuti Pandya
Publication Date:
11-2023
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The EU must embrace international cooperation and collaboration in technology-driven industries to ensure competitiveness and global relevance, while also considering the drawbacks of isolationist policies. The EU’s commitment to open markets and global cooperation has historically been its strength, and EU policymakers should continue to prioritise on these principles. Global markets, international R&D collaboration and global industry-led standards are crucial for innovation and efficiency in technology-intensive industries. Various sectors, including pharmaceuticals, ICT, aerospace, and defence, heavily rely on global partnerships to stay competitive and advance technologically. International cooperation in economic and security affairs, as exemplified by EU participation in global value chains of advanced semiconductors, the traditional EU approach to industry-led technology standardisation, and EU involvement in the international F-35 fighter development program, is critical for leveraging industry expertise, sharing technological advancements, and collectively addressing challenges in strategic sectors, thereby enhancing Europe’s economic resilience and security capabilities. Trust and legal certainty form the foundation for international partnerships in high-tech and defence sectors. Collaborations among like-minded partners enable secure information sharing, intellectual property protection, financial commitments, and compliance with regulations, while ensuring adherence to key EU values like human rights and the rule of law.
Topic:
International Cooperation, Science and Technology, European Union, Trade, Resilience, and Competition
Political Geography:
Europe

10. Has Globalisation Really Peaked for Europe?

Author:
Lucian Cernat
Publication Date:
11-2022
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
This paper builds on the recent arguments put forward by Richard Baldwin and others debunking the myth that we enter a period of de-globalisation. The paper argues that globalisation is a complex phenomenon that requires detailed, firm-level indicators going beyond simple aggregate metrics. When using such indicators, the picture is much more nuanced and, in the case of Europe, the role of global trade is as important as ever for hundreds of thousands of companies and millions of jobs supported by global trade flows. A strong participation in the “new globalisation” is also key for the future EU competitiveness in technology-driven sectors.
Topic:
Globalization, International Trade and Finance, Science and Technology, European Union, and Trade
Political Geography:
Europe