Christine Lagarde calls for EU to continue progress on European integration of AI as well as development of AI sovereignty and strategic autonomy.
The President of the European Central Bank (ECB), Christine Lagarde, gave a speech in Vienna on 14 September calling for the faster integration of AI in Europe as well as for a transition away from technological imports to develop sovereign AI. Bridging the topics of European capital markets and AI development, she sets out objectives through which Europe can benefit from technological innovation.
In discussing the need for Europe to adopt AI more quickly, Lagarde highlighted how firms as well as workers within the EU have already begun to integrate the technology into their tasks and are doing so at a rate faster than for the integration of the Internet. However, she also underlined the remaining gap between the EU and the United States, both in terms of AI investment and in terms of American workers spending more time working with AI. In this, she also pointed to the challenge faced by Europe’s ageing society and how accelerating the adoption of AI can help overcome the issues of a shrinking European workforce.
Moreover, Lagarde turned her attention to European dependence on imported AI models from the United States and China, stressing three vulnerabilities to European digital sovereignty: ensuring control over data, ensuring autonomous access to AI, and accessing the best models. With these three issues, Lagarde considers that ‘Europe has an awkward choice’ to make where it either forgoes AI adoption and economic growth because it cannot protect its data, or it adopts AI rapidly and develops a dependence on foreign actors which threatens its strategic autonomy.
To address these challenges, she calls for the EU to build more data centre capacity to close the gap with its own computing demands, a gap which is expected to grow more than sixfold within a decade. Lagarde also reminds that Europe can build on emerging AI firms like the French company Mistral AI as well as on hardware actors like Netherlands-based semiconductor firm ASML. Through investments and the adoption of relevant policies, she expects Europe to obtain domestically developed open models and to secure its access to the frontier.
Why does it matter?
Lagarde’s speech reflects the EU’s aspirations for digital sovereignty as well as underlining how concerns regarding data security and AI access remain at the forefront of European institutions. As she centres companies like Mistral AI and ASML at the heart of Europe’s AI strategies, Lagarde also points to the institution’s regulatory expansion which increasingly encompasses technological supply-chains. In developing its digital sovereignty and pursuing strategic autonomy, the EU is blending both high-level legislation like the AI Act with investment initiatives like the Chips Act and the AI Continent Action Plan.
At the same time, recent announcements by ASML and Mistral AI point to the potential emergence of strategic partnerships between the EU and other states. For example, in seeking to advance semiconductor production processes, ASML has launched a collaborative initiative with TSMC. This initiative is, in part, because the complexity of next-generation chip manufacturing requires joint efforts. Similarly, while Mistral AI’s raised the largest equity ever by a European technology company, its series D round received significant funding from South Korean technology giant Samsung.
Lagarde mentions that ‘there is nothing inherently bad about importing’ and, thus, it may be that the EU will develop its sovereignty and strategic autonomy through a combination of domestic industry initiatives and select partnerships with states like South Korea or the United Kingdom. Europe retains the possibility of positioning itself with a separate approach to that of the United States and China, potentially pursuing a strategy that balances sovereignty with international collaboration.
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