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Europe launched the “three-board axe” to launch the “digital sovereignty” defense war.

Europe launched the "three-board axe" to launch the "digital sovereignty" defense war.

In 2020, despite the severe impact of the COVID-19 epidemic, the EU has made real progress in the field of digital sovereignty, advancing step by step in the fields of data economy and innovation, privacy and data protection, and network security, data control and online platform behavior.

On the one hand, the EU plans for a long time, carefully formulates a number of digital strategies, and does a good job in digital transformation and development planning.

On the other hand, we will continue to strengthen the supervision of American digital giants, actively guide and coordinate European countries to increase investment in the digital field, and promote the construction of digital capabilities and single digital markets.

In the future, with the transformation of the attitude of the United States towards Europe, resolving the digital sovereignty dispute between the United States and Europe will become an important issue in the new transatlantic relationship.

Mastering digital sovereignty through capacity-building

The EU is well aware that sovereignty in the digital field will not fall from the sky, and promoting its own digital capacity-building is fundamental.

In terms of strategic planning, in February 2020, the European Commission released three documents, “Shaping Europe’s Digital Future”, “European Data Strategy” and “White Paper on Artificial Intelligence”, covering aspects such as cybersecurity, critical infrastructure, digital education and single data market, forming a new digital transformation strategy for Europe.

In July, digital transformation became an important part of the EU’s Next Generation Recovery Plan. The European Parliament released the European Digital Sovereignty report, which puts forward further initiatives from three paths: building a data framework, promoting a credible environment, and establishing competition and regulatory rules.

In December, the European Union launched the Digital Europe Plan. 

Europe will provide 7.6 billion euros over the next seven years to build and expand Europe’s digital capabilities and strengthen Europe’s digital sovereignty.

In terms of data platforms, in April, the European Union launched the European COVID-19 Data Platform aimed at collecting and sharing research data as one of the projects of the European Open Science Cloud.

In June, the new European cloud storage service Gaia-X led by France and Germany and involving 27 European countries was officially launched. The project, which connects elements through open interfaces and standards to link data and create innovative platforms, is planned to be put to market after testing is completed in 2021. Its goal is to independently develop Europe’s next-generation data infrastructure to make Europe a leader in the industrial data wave.

In terms of supercomputing, in September, the European Supercomputing Capacity Network (EuroCC), which participated 33 European countries and invested a total of 840 million euros, was officially launched.

Supercomputer is a necessary foundation for cutting-edge scientific research and industrial innovation applications. Europe will build eight supercomputer centers and connect them with each other through high-speed networks to build infrastructure for high-performance computing in Europe. The Gaussian Supercomputing Center in Germany is responsible for the coordination of EuroCC.

German Federal Minister for Research Kaliček said that the launch of the European network of supercomputer capabilities showed that Europe’s supercomputers could provide the best equipment for the digital age. We are strengthening the technological sovereignty of Germany and Europe. This will increase the competitiveness and future viability of Germany and Europe.

In terms of chips and microelectronics, in December, 17 European countries signed the European Electronic Chip and Semiconductor Industry Alliance Plan, with the goal of building advanced European chip design and production capacity, improving Europe’s position in the global semiconductor market, and reducing dependence on Asian and American imports.

Thierry Breton, the internal market commissioner of the European Commission, said that Europe will not have digital sovereignty without autonomy in the field of microelectronics. The EU should pursue to produce at least one-fifth of the global value of chips and microprocessors to better compete with countries such as the United States.

In addition, the European Processor Initiative (EPI), which is committed to European chip autonomy, is also continuing to advance, and the first batch of microprocessors will be put into commercial production in 2022.

Strengthen market supervision to seize digital sovereignty

Strengthening the supervision of the world’s digital giants is another important measure by the EU to provide enough space for its development in the digital field. In December, the European Commission submitted two new digital bills, the Digital Services Act and the Digital Markets Act, which aim to regulate social media, online markets and other online platforms operating within the EU.

The European Commission said that these two bills were at the core of its plan for the European Digital Decade.

Those major technology platforms in the United States and other countries that profit for themselves by damaging competitors may be forced to sell their businesses and pay billions of dollars in fines.

In addition, the European Union has announced the rules for search rankings for technology giants such as Microsoft and Google in the United States, requiring these technology giants to enhance the transparency of search rankings.

The digital tax is a powerful tool for unequal competition against American digital giants. Europe once suspended its digital service tax collection plan and sought multilateral agreements on international tax rules within the framework of the OECD.

However, the U.S. Treasury Department announced its withdrawal from the negotiations in June, which led to the failure to reach an agreement on the digital tax negotiations involving nearly 140 countries.

The deadline for the negotiations has been extended to mid-2021. Therefore, France restarted its digital service tax collection plan in December, which will impose a 3% digital service tax on Internet companies with revenues of more than 25 million euros in France and more than 750 million euros worldwide. European countries such as Italy, Spain and Austria have also proposed their own digital tax schemes.

In addition, strengthening digital privacy protection is also a sharp sword for Europe to show its digital sovereignty. The EU’s General Data Protection Regulation strictly regulates the collection and use of personal information.

Data controllers can transfer personal data to third countries or international organizations outside the EU only if the conditions specified by them are met. In July 2020, the Privacy Shield Agreement, a mechanism for cross-border data transfer between the United States and Europe, was ruled invalid by the Supreme Court of the European Union.

The court held that the privacy protection standards of the United States do not comply with EU guidelines and do not adequately protect the privacy of EU citizens from improper voyeurs by the U.S. government. This move brings legal and regulatory obstacles to multi-billion-dollar digital trade and has become an urgent problem to be solved in the transatlantic digital-related negotiations.

Seize the opportunity of the game to defend digital sovereignty

Overall, the development of digital economy in European countries is uneven, cross-border barriers and market fragmentation still exist, and the task of establishing a single digital market is still very difficult. 

From social platforms to infrastructure, Europe has to make strenuous efforts to get rid of dependence on countries such as the United States in all areas of the digital economy.

The European market is increasingly becoming a key battlefield for the United States and China to establish its global technological and industrial dominance, which poses a huge challenge to Europe’s digital transformation. But at the same time, Europe also realizes that this is an opportunity that can be actively exploited.

The digital economy involves the core interests of Europe. The German Foreign Policy Association (DGAP) reports that the United States needs time and appropriate mechanisms to cooperate with Europe in a constructive manner to implement Europe’s huge new draft legislation.

The EU has actively initiated the establishment of the EU-United States Trade and Technology Commission, hoping to engage in dialogue and consultation with the United States on a wide range of issues, including the digital economy.

However, in the face of huge economic interests, even with the so-called “transatlantic traditional friendship”, technology policy negotiations between Europe and the United States cannot be achieved overnight.

On the other hand, Europe, which has been hit hard by the coronavirus epidemic, will look more forward to leading a sound economic recovery through digital transformation. While emphasizing supply chain security, Europe is also interested in strengthening and deepening cooperation with China in the digital field.

During the China-EU leaders’ meeting, the two sides agreed to strengthen interconnection and deepen cooperation in trade, investment, digital economy and other fields. 

China and the EU have decided to establish a high-level dialogue in the digital field between China and Europe to build a China-EU digital partnership.

The German Global and Regional Research Center (GIGA) reports that the EU should rely more on its balancing ability and higher technological sovereignty while striving for multilateral, open and rules-based technical cooperation.

The EU has one of the largest markets in the world and is one of the most important research and innovation venues in the world.

Judging from the development of similar core technologies such as Airbus and Galileo Global Navigation System, the struggle for technological sovereignty has been accompanied by the growth of the European Union.

Looking ahead, despite the twists and turns of the road, the EU will gradually gain control over data, innovation capabilities, and legislative and enforcement capabilities in the digital environment.

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