Infrastructure is Europe’s first line of defence
I saw an interesting story online the other day on TechCrunch reporting an open letter sent by “a broad coalition drawn from across the ranks of Europe’s tech industry” calling for radical action from the EU “to shrink reliance on foreign-owned digital infrastructure and services”.
The letter had been prompted by concerns over the reliability of the US as a trusted partner for the supply of digital infrastructure fuelled, in part, by the antagonistic comments from US vice president JD Vance at the Munich security conference last February. As Politico noted in its headline of Vance’s visit, the vice president spent a week “waging war on EU tech law”, attacking Europe’s regulations governing US big tech companies.
TechCrunch quoted Wolfgang Oels, COO of Berlin-based tree-planting search engine Ecosia (a signatory of the letter), arguing that Europe could no longer afford to leave its digital infrastructure at the mercy of the whims of Donald Trump.
“Trump switched off access to vital infrastructures because Ukraine was not ready to cede its land and hand over its minerals,” he told TechCrunch. “Europeans need sovereignty in critical infrastructures and those do not only consist of energy and health, but certainly also digital ones.”
Andy Yen, founder of Switzerland-based Proton and signatory to the letter, added that the situation was so critical that it necessitated “requiring public procurement (and perhaps even private procurement) to buy European”.
It’s a very interesting article and well worth reading.
Right to refuse
You may not have seen an earlier story in euronews highlighting a report from Goldman Sachs that the EU could consider targeting US tech services instead of goods in retaliation for any new tariffs from Donald Trump.
The report argued that by restricting US digital services, the EU could dent a sector “that generates billions in revenue from European markets”. As the story notes, the deficit in services is caused by the dominance of US tech companies. And that could have major implications for Ireland.
“Services imported by the EU from the US span different sectors, including the financial sector, but the lion’s share are IT services that are then invoiced as royalties channelled to the US from Ireland,” Goldman Sachs noted.
So what happens if the current antagonistic approach being adopted by Trump’s America leads to a shift to buying European and, possibly, tariffs against US tech services in the future? Ireland’s reliance on those corporation tax receipts facilitated by the channelling of royalties to the US from here will obviously be under threat.
On the other side, they will also be in peril if Trump seeks to force those US companies currently operating here as a bridge into the EU market to go back to America. That may not be much of a choice in any case if the Trump administration’s pursuit of lower regulation and protections creates a growing divergence with standards and regulations in the EU.
We are already seeing divergence in the way that the EU is ruling against the likes of Meta, Apple and Google for practices that appear to be acceptable in their home country. It’s hard to see how the divide will not widen over time, short of the EU capitulating to Trump and Vance’s demands by weakening its regulations and protections. That does not seem likely at this point in time.
Ireland’s current status, built up over many years, will need to change. That will either be voluntary or forced but the stakes are becoming too high for the EU to entrust its critical infrastructure to the whims of a volatile US president and his acolytes.
If the US administration continues on its path of very public opposition and antagonism to the EU, it will be interesting to see what this means in the future for so many companies on this side of the Atlantic that have built their business on selling US technology.
Brute efforts by Trump to impose weakened US regulations and standards on the EU through the blunt instrument of tariffs are unlikely to succeed. If anything, they are likely to drive the EU away from buying US technology. That could be something a lot of US companies might come to regret. As for us, here in Ireland, we could be forced to decide whether the future lies to the west in the US or closer to home in Europe.
Subscribers 0
Fans 0
Followers 0
Followers