Search

Begin New Search Topic European Union Political Geography United States of America

31. Empires of Exceptionalism: Lessons from the EU AI Act and Attempts at AI Legislation in California

Author:
Hosuk Lee-Makiyama and Claudia Lozano
Publication Date:
11-2024
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The EU AI Act, which passed after three years of negotiations and much ambivalence, sets a comprehensive regulatory framework that reflects the European Union’s unique needs that are not translatable to other jurisdictions. The proposed bill in California (SB 1047) illustrates this case in point. The bill could potentially mislead the public into thinking that AI is already under effective regulatory control. Lawmakers must recognize that the EU differs from other systems. The EU AI Act is not only shaped by the desire to slow down global AI development, allowing Europe to catch up with rivals like the US and China: The EU lacks an enforceable constitution, and the Act prohibits its governments to impose social scoring and discriminatory measures. SB 1047 only addressed humanity-ending disasters and had unclear practical value. Meanwhile, the EU AI Act was passed into law to prevent internal competition and Europe’s history of authoritarianism. Existing laws in California and the EU already regulate most AI use cases. In addition, the EU AI Act reviews existing regulations to ensure they are still fit for purpose, something California failed to do in SB 1047. A critical takeaway is to examine existing obligations or executive powers (including enforcement agencies and public funding) to achieve the desired policy objectives. The diverging outcomes of the two laws show the importance of avoiding mismatches between policy objectives and legislative scope. AI regulation cannot substitute for other policy objectives, like privacy and antitrust. Also, lawmakers must weigh the cost of failed regulation against the risks of non-regulation. California did not see any immediate costs of inaction, whereas delayed action by the EU might have led to the fragmentation of its internal market. Also, given its collective decision-making, the EU can escape accountability for policy failures due to premature laws in a way the leaders in other political systems cannot.
Topic:
European Union, Digital Economy, Legislation, and Artificial Intelligence
Political Geography:
Europe, California, North America, and United States of America

32. The Rise of Fragmentation. A New Economic Security Era?

Author:
Alessandro Gili and Filippo Fasulo
Publication Date:
09-2024
Content Type:
Special Report
Institution:
Italian Institute for International Political Studies (ISPI)
Abstract:
Multiple crises have shaken the foundations of the global economy, and the resulting instability has yet to recover. Instead, it has led to increasing fragmentation along political and ideological lines. The current geoeconomic order is increasingly defined by the use of advanced trade defense and economic security tools, such as tariffs, trade barriers, sanctions, and export restrictions, which have become more sophisticated. Major economies are adapting to this new reality by shaping their own definitions of economic security, particularly to safeguard critical and high-tech sectors. The EU, the US, and China are each calibrating their economic security strategies, seeking a balance between openness and protection that maximizes their respective advantages. However, in this shifting international landscape, new actors are emerging with the potential to influence the global balance of power. What type of "new globalization" is emerging? Could economic security tools become the new normal in the global economy? What are the key economic security strategies adopted by the world's leading economies?
Topic:
European Union, Economy, Ideology, Tariffs, Trade, Economic Security, Instability, Fragmentation, and Geoeconomics
Political Geography:
China, Europe, and United States of America

33. How the European Union should respond to Trump’s tariffs

Author:
Ignacio Garcia Bercero, Petros C. Mavroidis, and André Sapir
Publication Date:
12-2024
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
President-elect Trump has threatened to increase United States tariffs to 60 percent on imports from China and 10 percent to 20 percent on imports from other trading partners, including the European Union. In doing so the US would be ignoring its World Trade Organisation commitments and would also rollback the substantial liberalisation that has taken place during the past 80 years, with a potentially major negative impact on the world economy. In response to this threat, the EU should pursue a three-pronged strategy. First, the EU should engage bilaterally with the US to seek to avoid the imposition of tariffs. This could include an offer to consider measures on facilitation of bilateral trade and on economic security cooperation, while making clear that any trade measures adopted by the EU will be consistent with WTO rules. This offer should be backed up with a credible threat of retaliation that could be implemented if the US decides to impose tariffs on EU exports. Retaliation could take the form of a negative list – the EU would increase its tariffs on all US exports to the same level as the US tariffs, except for products imported from the US identified as crucial for the EU. Second, the EU should act to preserve a functioning rules-based multilateral trading system, including on dispute settlement, and should continue to pursue WTO reform. To this end, the EU should build a coalition of countries including key players from the Global North and the Global South ready to lead in this endeavour. Third, the EU should expand its network of bilateral and regional preferential trade agreements. The priority should be the ratification of the agreement with Mercosur, but the EU should also aim to improve trade relations with the United Kingdom and Switzerland and to further strengthen partnerships in the Indo-Pacific region, and with Africa.
Topic:
European Union, Tariffs, Trade Policy, and Donald Trump
Political Geography:
Europe and United States of America

34. Catch-up with the US or prosper below the tech frontier? An EU artificial intelligence strategy

Author:
Bertin Martens
Publication Date:
10-2024
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
European Union policymakers want to close the artificial intelligence innovation gap with the United States, as a way to accelerate lagging productivity growth. The EU focus is on expanding an existing supercomputer network with more AI hardware and computing infrastructure, with taxpayer support. However, this computing infrastructure is not adapted to AI modelling. The cost of catching up with leading big tech AI computing centres is already prohibitive for EU budgets, and is set to become even more so. The hardware focus overlooks missing EU markets for complementary services that are required to set up a successful AI business: large-scale business outlets for frontier generative AI models to generate sufficient revenues to cover huge fixed model training costs, hyperscale cloud-computing infrastructure and private equity financing for AI start-ups. In the absence of (or with insufficient) complementary services markets in the EU, start-ups are forced to collaborate with US big tech firms. Injecting taxpayer subsidies to make up for these missing markets may further distort EU markets. Regulatory compliance costs, including uncertainty about the implementation arrangements for the EU Artificial Intelligence Act, add to market problems. The EU should address a wider range of market failures in its policy initiatives. It should strive to increase productivity growth below the AI technology frontier, by facilitating investment and applications of AI-driven services produced by derived and specialised generative AI models, or AI-applications that build on top of existing generative AI models. Building these below-frontier AI applications requires far less computing capacity and less heavy investment costs. Promoting the uptake of AI application services across a wide range of industries can substantially stimulate productivity growth. That requires a razor-sharp focus on pro-innovation guidelines, standards and implementation provisions for the EU AI Act, shortening the Act’s regulatory uncertainty horizon as much as possible, and facilitating collaborations between EU AI startups and big tech companies. Widening and deepening the EU private equity and venture capital market would also be very helpful.
Topic:
Markets, Science and Technology, European Union, Investment, and Artificial Intelligence
Political Geography:
Europe and United States of America

35. Military capabilities affected by climate change: An analysis of China, Russia and the United States

Author:
Adaja Stoetman, Dick Zandee, Ties Dams, Niels Drost, and Louise Van Schaik
Publication Date:
01-2023
Content Type:
Special Report
Institution:
Clingendael Netherlands Institute of International Relations
Abstract:
Climate change is one of the most pressing challenges of the present and the future. Rising temperatures and sea levels, as well as extreme weather events are manifestations of climate change that also influence military capabilities. Increased attention for the climate change-security nexus is visible both at the national and the international level: nationally through the incorporation of climate change in security strategies and internationally through incorporation in important strategic documents such as the EU’s Strategic Compass and NATO’s Strategic Concept. Given its transnational nature, governments around the world have a shared responsibility to face climate change. A particular role is laid down for the global powers, China, Russia and the United States, given their position in the world. It is, however, questionable whether the global powers’ interests align. They differ in their approaches to address climate change, and even more so in their views on how it affects the armed forces. China and particularly Russia are more reluctant towards depicting climate change as a matter of international security. This is for example visible in international forums, such as the UN Security Council. In contrast, in the US, support for climate action is subject to political preferences, but climate related security risks are widely recognised within the defence establishment. This report reviews various aspects of the relationship between climate and security, with a particular focus on the military. It discusses the role of climate change in a country’s security and defence strategy and, vice versa, the changing tasks and deployment of the armed forces in response to climate change, the effects of climate change on military infrastructure, and measures to realise a greener defence sector.
Topic:
Security, Climate Change, European Union, and Military
Political Geography:
Russia, China, Asia, North America, and United States of America

36. Assessing Digital Leadership: Is the EU Losing out to the US?

Author:
Dario Guarascio and Roman Stöllinger
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
Since Leontief’s (1953) seminal work on the factor content of trade, the validity of the Heckscher-Ohlin-model has been judged not only on the basis of formal tests of the theory but also tested against prior expectation. In this vein, this paper uses the Heckscher-Ohlin-Vanek (HOV) approach to investigate whether supposed US leadership in the digital domain can be traced back to digital task endowments embodied in labour services. In a comparison between EU member states and the US, we find that the latter is more intensive in digital tasks than the EU and that this difference is explained by both an intensity-effect (US occupations being more digital-task intensive) and a structural component (relatively more digital-task intensive occupations). Viewed through the lens of the HOV theorem we find that the US is abundant in digital tasks relative to non-digital tasks, while the opposite is true for the EU. The standard tests for the predictive power of the HOV theorem are high and in line with the results for labour in previous literature.
Topic:
International Trade and Finance, Foreign Direct Investment, European Union, Digitalization, and Competition
Political Geography:
Europe and United States of America

37. Trade Balances and International Competitiveness in Cyber-physical, Digital Task-intensive, ICT Capital-intensive and Traditional Industries

Author:
Alexandra Bykova and Roman Stöllinger
Publication Date:
05-2023
Content Type:
Special Report
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
In this report, we analyse the international competitiveness of the EU in four industry groups over the period 1995-2018. The groups are delineated by specific factor intensities, where these intensities are assessed from digital tasks performed by labour services and ICT capital stocks. The EU’s positions relating to trade balances, revealed comparative advantages and unit value ratios are assessed relative to its main competitors, such as the US, China, Japan and South Korea. The trade specialisation patterns confirm EU advantages in traditional industries, which still represent the largest part of global trade, and in the group of digital task-intensive industries. In the cyber-physical group of industries, which are characterised by both high digital task and ICT capital intensities, the EU records a trade deficit, although this has been receding in recent years. Competitiveness indicators depict heterogeneity among EU countries. The loss of international competitiveness for some technology front-runners is a worrying sign. On the positive side, however, a reduction in trade deficits or an improvement in product quality and market shares is evident for certain EU countries, especially in the Central European region.
Topic:
International Trade and Finance, European Union, Trade, Digitalization, and International Competition
Political Geography:
Japan, China, Europe, Asia, South Korea, and United States of America

38. The Ukraine War & European Security: How Durable Is America’s Strategy?

Author:
Zachary Paikin
Publication Date:
04-2023
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
More than a year after Russia’s invasion of Ukraine, the morale of the United States and its Western allies appears high.1 Spurred into action by Moscow’s act of aggression, NATO appears more united, the EU has seemingly become more of a geopolitical actor, and Ukraine has resisted and repulsed the Russian onslaught to a degree that few initially thought possible. The Biden administration has thus far laudably managed to ramp up assistance to Kyiv without directly confronting Moscow. However, while the current U.S. policy toward Russia and Ukraine may be sustainable for some time, that does not mean it will never run out of road. Sanctions against Russia — a major global economy — have been ramped up to a level previously unseen, but they have not been effective in compelling Moscow to change course. The United States and its allies have yet to agree on what they deem to be an acceptable endgame to the war. Great power or not, Russia will remain a populous, powerful and potentially disruptive actor in Europe. Without clearly and credibly proposing policies that can lower the temperature, and without beginning to envisage what a future European security order might look like, the United States risks prolonging the conflict — with potentially unforeseeable consequences if popular war–weariness continues to grow.
Topic:
Foreign Policy, NATO, Sanctions, European Union, Strategy, Military Aid, Regional Security, and Russia-Ukraine War
Political Geography:
Russia, Europe, Ukraine, and United States of America

39. China/United States: Europe off Balance

Author:
Thomas Gomart and Marc Hecker
Publication Date:
04-2023
Content Type:
Special Report
Institution:
Institut français des relations internationales (IFRI)
Abstract:
As French President Emmanuel Macron (accompanied by Ursula von der Leyen) is on a state visit to China, some twenty Ifri researchers decipher the stakes of the U.S./China/Europe strategic triangle. This 16-text study follows Olaf Scholz’s visit to Beijing (November 2022) and precedes that of Emmanuel Macron (April 2023). It comes especially one year after the beginning of a geopolitical and geoeconomic shock of a rare magnitude: the invasion of Ukraine by Russia. The War in Ukraine or the Return of Bloc Geopolitics? The war in Ukraine has broken ties between the European Union (EU) and Russia for the foreseeable future, particularly in the field of energy, though not without consequences in the Middle East, Africa, and the Indo-Pacific. Furthermore, this war has become the main show of active indirect confrontation between the United States—which has provided military support to Ukrainians, with help from its European allies—and China, which has supported Russia politically and economically. In February 2022, Moscow and Beijing declared their “no limits friendship”; in March 2023, Xi Jinping offered his personal support to Vladimir Putin after the International Criminal Court issued a warrant for his arrest. In its position on the political settlement of the Ukraine crisis, presented in February 2023, China stated: “All parties should oppose the pursuit of one’s own security at the cost of others’ security, prevent bloc confrontation, and work together for peace and stability on the Eurasian Continent”. China is no more of a mediator than the United States: it would be unrealistic to believe so. We appear to be witnessing a return of bloc geopolitics, albeit in a starkly different context than that of the Cold War (1947-1991). Globalization has produced strong economic and technological interdependencies that make any prospect of decoupling very costly, if not impossible. Economic partners are no longer necessarily military allies, and vice versa. In other words, a gap is opening up between geopolitical perceptions and geoeconomic realities. The term “decoupling” is popular in the United States, though much less so elsewhere. The rejection of bloc geopolitics is particularly acute outside of the West, where a “pragmatic” approach to foreign policy is often promoted. The Saudi foreign minister summed this up during the World Policy Conference in December 2022: “Polarization is the last thing we need right now. […] We need to build bridges, strengthen connections, and find areas of cooperation”. A few months later, China pulled off an extraordinary diplomatic coup by brokering a deal to restore relations between Riyadh and Tehran. For the EU, the situation is particularly delicate: Europe is in the Western camp, but a severing of ties with Beijing would cause a crushing economic blow. In 2022, China accounted for more than 20% of the EU’s imports, while the United States accounted for around 12%. By 2030, the EU’s GDP is expected to rise to $20.5 trillion, compared to $30.5 trillion for the United States and $33.7 trillion for China. In January 2023, the President of the European Commission declared at Davos: “We still need to work and trade with China, especially when it comes to this transition. So, we need to refocus our approach on de-risking, rather than decoupling”. For its part, Beijing has encouraged European aspirations of “strategic autonomy”, understood in China as a form of detachment from the United States. At the same time, the EU is constantly strengthening its military, technological, financial and energy ties with the U.S. This collective study notes a hypothetical search for balance on the part of the Europeans, faced with a war on their territory (the Western peninsula of the heartland), who cannot escape Sino-American mechanisms, and who do not form a monolithic whole. It also analyzes the strategy of several important actors outside our continent, and shows that, from Ukraine to Taiwan, via Africa and the Middle East, Europeans have little room for maneuver. This is why the study proposes recommendations to try, at a crucial moment, to reinforce their positioning.
Topic:
Foreign Policy, Climate Change, International Trade and Finance, Science and Technology, European Union, and Industry
Political Geography:
China, Europe, and United States of America

40. Digital Sovereignty: European Policies, American Dilemmas

Author:
Mathilde Velliet
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
Institut français des relations internationales (IFRI)
Abstract:
European digital sovereignty has been made a priority by Ursula von der Leyen’s European Commission. Due to the privileged position of American companies in the European market, Brussels’ efforts towards digital sovereignty (on privacy, antitrust, data sovereignty, etc.) are closely scrutinized by American policymakers. They often view European initiatives as “protectionist” and unfairly targeting U.S. companies. However, the American vision of European digital sovereignty has evolved in recent years under the influence of two main factors. On the one hand, awareness of the problematic effects and practices of platforms has led to a consensus on the need for reform in the digital sector. On the other hand, technological competition with China has been elevated to a priority. This vision remains fraught with contradictions, along inter-party, intra-party, inter-agency, state-federal, and issue-based fault lines. Washington’s position on anti-monopolistic practices is an illuminating example, characterized by a double discourse between a desire to reform the U.S. digital sector domestically and active diplomacy to dilute these efforts at the European level. Nonetheless, several American actors – particularly in the legislative branch – are seeking to learn from the successes and flaws of European regulations for American reform projects, such as on platform regulation or privacy. The China factor reinforces the ambiguity of the U.S.’ position. It creates new opportunities for cooperation in the face of perceived common vulnerabilities (infrastructure security, inbound investments, etc.) and autocratic definitions of digital sovereignty. However, it also raises tension and misunderstanding on the American side towards European reforms that often target American companies more than Chinese ones. Lastly, while American and European companies have adapted to the need for digital sovereignty through a range of technical and commercial solutions, the temptation of a maximalist definition of European sovereignty continues to create major stumbling blocks, particularly on the cloud.
Topic:
European Union, Regulation, Cloud Computing, Digital Sovereignty, and Data Governance
Political Geography:
China, Europe, Asia, North America, and United States of America