Vulcan Insight

EU leaders push digital sovereignty up the agenda

18 September 2020

Next Thursday EU leaders will convene for a two-day summit to agree how Europe can achieve sovereignty in the digital world. The urgent need for digital independence has been laid bare by Europe’s reliance on digital infrastructure during the ongoing COVID-19 pandemic.

The European Commission has provided an impetus for EU leaders to find a common position on the development of super computers, the rollout of 5G technology, increased cybersecurity and improvements in digital education – more funding.

According to a draft position, EU leaders want the EU to launch 5G services in all EU Member States by the end of 2020, aiming to deploy sound investments delivering uninterrupted 5G coverage in urban areas and along the main transport paths by 2025.

On Wednesday, the President of the European Commission announced that 20% of the €750 billion EU COVID recovery fund, ‘Next Generation EU’, will be ring-fenced for digital initiatives. The Commission also proposed the creation of a European cloud based on Gaia-x, an initiative to link various cloud service providers.

If EU leaders can agree the priority areas for investment, the EU will be closer to achieving digital sovereignty from the likes of China and the U.S. that are winning the global digital arms race.

As part of this plan, EU leaders are also focusing on the development of an EU-wide public electronic identification system (e-ID) to access cross-border digital services and give EU citizens control over their online identity and data. It is expected that they will urge the Commission to put forward this initiative by mid-2021.

Beyond investment, the European Union aims to defend its nascent digital agenda by strengthening its competition rules to keep the U.S. and China in check. However, EU leaders are split on the approach. France and Germany are advocating for a major overhaul of the existing framework, favouring the creation of so called “European champions”. However, the traditionally free-trading Nordic and Baltic countries disagree with this approach and view the idea of “champions” as potentially problematic further down the line. They fear it will undermine small businesses and a competitive single market.

Pressure is mounting on EU leaders to find a common approach next week as a European competition framework will help ensure that it meets the challenges of not only a digital transition, but the Green transition – a major priority for the European Commission over this legislative term.