Europe’s private sector has to take its own steps to improve the investment environment and drive productivity and innovationBOX 2 Industry leaders typically point first to policy and regulatory shifts as essential enablers of raising Europe’s global technology competitiveness. Those public sector steps may well be critical, but there are a number of corresponding actions the private sector can take across the same six priority areas to help reduce the continent’s innovation and funding gap. Corporate leaders can recommit to bold strategic and productivity agendas to regain lost ground no matter what the environment around them. –Building scale. A complete single market should help – but so would consortiums, alliances and programmatic M&As. –Simplifying the regulatory and permitting environment. Simplification of the regulatory environment should help – but so would private companies joining forces to provide a platform for regulatory services that helps firms navigate public processes and procedures. –Increasing innovation capital and investment. A capital markets union and healthier venture capital and private equity environment should help – but so would more growth-oriented strategies, equity stories and corporate venture units. –Driving commercialization. Government procurement and market creation should help – but so would (cross-)industry partnerships to scale rollouts of new services. –Strengthening research and talent. Better public education should help – but so would corporate on-the-job and formal trainings as well as increased industry collaboration with academia. –Cultivating ecosystems and global leaders. Cluster development and industrial policies should help – but so would particularly large multinational enterprises paying more attention to nurturing ecosystems of innovators around them.8. Securing skills: Reskilling 1 million Europeans in priority tech. Extending on-the-job reskilling, diplomas and postgraduate courses in fields such as AI, cybersecurity, automation and big data with the goal to train more than 1 million Europeans in skills related to priority tech by 203049 could begin to close the skills gap and create the required baseline of tech talent. Europe could win back talent with talent attraction and visa programmes in sectors such as banking and “industrials”.50 Incentives for businesses to upskill, cross-skill and reskill employees and a robust career support system, including internships and job placement services, could begin to bridge the tech skills gap in critical value chain segments. Cultivating ecosystems and global leaders. Europe has largely missed the software wave and the consumer internet wave in tech. It focused instead on expanding its leadership in areas like industrial machinery and automotives. As a result, Europe does not have innovation clusters to rival Silicon Valley, and fewer leading technology firms that can serve as a nucleus of innovation for start- ups, a customer for new products, a potential funder or later buyer, or a source of well-trained employees and founders. Taking a page from the playbook of emerging economies could help address this. 9. Securing know-how: Global capability transfer: Europe can learn from emerging economies that have a long history of technology and capability transfer. Now it may be time for Europe to act where it has fallen behind, specifically incentivizing hyper-scalers to expand R&D presence and footprint in Europe and creating incentives or rules for them to build out European ecosystems and capabilities. More can be done to encourage within-Europe exchange of leading practice and capabilities, too. To ensure that the nine grands projets gain the required traction and momentum to deliver impact fast, a final overarching 10th grand projet is proposed with the purpose of coordinating efforts and tracking progress. 10. Driving action: Deploying a nerve centre and ensuring governance. Leadership, clear governance and accountability will be needed to move the other nine grands projets – as well as Europe’s overall competitiveness agenda – to action. Could a “nerve centre” across EU corporate and public leaders, large technology firms, start-up leaders, academics and civil society be established that coordinates and accelerates action? It would need to be sponsored at the highest level, reporting directly to EU leaders and CEOs, to set the right priorities. It could also continuously track progress, and course-correct where needed. One simple metric to track could be: How much in actual investment is being announced and made – in aggregate and per technology arena – in Europe? Though it’s incumbent upon the public sector to initiate and drive the policies it ultimately decides to propose, the private sector does not need to wait and has its own part to play in parallel across the same six key themes (see Box 2). Europe in the Intelligent Age: From Ideas to Action 19

Europe in the Intelligent Age 2025