EU Unveils Multi-Billion Tech Fund to Compete with US and Asia
Le Maire announced the creation of the fund at the “Building Europe’s Digital Sovereignty” conference in Paris on Monday. Photo: Sarah Meyssonnier/ Reuters
A multi-billion euro fund will expand Europe’s tech sector in an effort to make the continent more competitive against the U.S. and Asia. The initiation of the publicly funded reserve was announced by France’s Minister of Economy and Finance, Bruno Le Maire, at a digital sovereignty conference on Monday.
Le Maire explained that Europe’s dependence on foreign tech giants will decrease if domestic tech startups receive higher levels of financing, declaring, “there is no longer any political sovereignty without technological sovereignty.” The German finance ministry reported that Berlin would add one billion euros to the fund.
On Tuesday, the European Commission announced the EU will ease state aid laws for innovative semiconductor plants, in an attempt to double outputs in the domestic chip industry. The European Chips Act will contribute 15 billion euros in additional public and private investment by 2030, according to Commission President Ursula von der Leyen.
Not all EU countries feel comfortable with the relaxing of funding rules. One diplomat suggested that a race to obtain subsidies would favor companies based in larger countries like France, Germany, Italy, and the Netherlands.
A chip on an electronic device at a shop in Brussels, Belgium. Photo: Yves Herman/ Reuters
EU Digital Chief Margrethe Vestager warned EU governments against using unfair tactics to attract investments, explaining, “we have always been sort of very attentive to the fact that it should not be for one government to try to lure investments in one territory by jacking up the state aid promises.” Vestager clarified that Europe is hoping to become more independent, but becoming fully self-sufficient is not doable.
Currently, Europe venture capital funds are too small to contribute to the development of European tech startups, leaving entrepreneurs to seek funds abroad. The EU’s strict state aid rules have contributed to European firms’ inability to find public funding.
Europe’s move to boost semiconductor chip production mirrors the US CHIPS Act, a $52 billion bill aimed at increasing competition abroad passed by the Senate last summer, as a large volume of the global chip production takes place in China and Taiwan. Minister Le Maire’s introduction of the fund has laid out big picture plans, though details remain to be seen. “Our ultimate target is to have 10 technology companies worth more than 100 billion euros each by 2030.”