The manufacture of sensitive technologies such as semiconductors, quantum computers and other high-performance computers, biotechnology, instruments for climate protection and renewable energy or critical raw materials by European companies abroad must be more strictly regulated in the future. In individual countries such as China and Russia that are considered “systemic rivals” in the EU or subject to sanctions, outsourcing of production may be prohibited entirely. This is what emerges from the first European economic security strategy, which the EU Commission and Commissioner for Foreign Affairs and Security Policy, Josep Borrell, published on Tuesday.
The objective of the joint communication is to minimize the risks “that arise from certain economic flows in the context of heightened geopolitical tensions and accelerated technological changes”. At the same time, “a maximum of openness and economic dynamism” must be maintained. “In today’s fierce competition for the technologies we need most, Europe must play an active role,” said Commission Vice-President Margrethe Vestager, in charge of digital, in presenting the 15-page document. It is important to reduce the “risks of our mutual economic dependencies”, for example in supply chains, in critical infrastructure, as well as the dangers of technology flow and economic coercion – rather than decoupling completely. This is the only way to maintain “our leading position in the global technology race”.
Planned geopolitical filter
The strategy is “country-neutral,” Vestager emphasized. “However, we will use a geopolitical filter when assessing risks.” The identified risks “reflect the behavior we are observing in third countries”. It’s no secret “that Russia has raised our concerns about energy security.” Commission President Ursula von der Leyen (CDU) also emphasized in March that there were “particular concerns” about security and the flow of technology in relation to China.
The EU already has a regulation on the export of goods, materials, software and other technology that can be used for both military and civilian purposes (dual use). According to the document, this includes quantum computers, advanced chips and artificial intelligence (AI). The Commission intends to apply the associated export controls more rigorously in the future and will present a proposal by the end of the year at the latest to “improve the effectiveness and efficiency of the existing framework”. Together with a new group of experts from member states, the Brussels government institution also intends to explore “possible measures to deal with security risks related to foreign investments”.
Acquisitions of companies are also controlled
A longer list of technologies that are critically important to economic security is expected to be in place by September. In addition, according to the plan, there will be stronger controls on whether foreign companies can buy operations or critical infrastructure in the EU. Indeed, national security is a matter for member states. It is unlikely that many simply want their skills in this area to be taken away from them. Vestager therefore warned: “If we don’t act together, we’re a playground. If we act together, we’re an actor.” Economic dependencies must no longer be “weaponized” by third countries: “We have to protect our data and our technology”. The Commission therefore also took more specific action against Huawei and ZTE last week.
(mki)
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