Europe’s urgent mission: Nokia and Ericsson lead the charge for tech competitiveness
Nokia and Ericsson, two of Europe’s leading connectivity companies, have joined forces with technology giants ASML and SAP to address a growing challenge: Europe’s lagging competitiveness in the global tech industry. Hosting the New Industrial Ambition for Europe summit in Brussels, the companies aim to catalyse investment, innovation, and reform across the European Union to secure the region’s digital future.
With support from senior policymakers and leading CEOs, the summit highlights a defining moment for Europe to reclaim its technological leadership through decisive action and long-term strategies.
Why Is Europe Falling Behind in the Global Tech Race?
Despite being home to some of the world’s most advanced companies, Europe continues to trail behind the United States and China in technology innovation and economic influence. According to the 2024 Draghi Report, U.S. tech giants spent the equivalent of 50% of Europe’s total public and private R&D budgets in 2023. Additionally, Europe faces a staggering €450 billion investment gap in technology, resulting in a 20% productivity deficit compared to U.S. firms.
This disparity has real consequences for Europe’s digitalisation efforts, with connectivity and innovation increasingly linked to economic growth and security. Speaking at the summit, Nokia President and CEO Pekka Lundmark warned, “European competitiveness already has one foot in the morgue. Our digital future looks less certain than ever, but the good news is that we can still turn this tanker around.”
What Are the Key Priorities for Reviving Europe’s Tech Sector?
The summit’s discussions revolve around implementing the recommendations of the 2024 Draghi and Letta reports, which provide a roadmap for fostering innovation and reducing fragmentation across Europe’s technology landscape. These reports emphasise the need for investment in advanced connectivity, artificial intelligence, and cloud computing while creating a regulatory environment that encourages growth.
Pekka Lundmark and Ericsson CEO Börje Ekholm emphasised the importance of policy reform. Ekholm noted, “Regions like the U.S. and China are embracing opportunity through investment, policy, and regulatory support. Europe is not. If this continues, the model cannot survive.”
Key actions highlighted include:
- Implementing the 5G Security Toolbox to safeguard networks critical for digitalisation.
- Strengthening R&D investment to bridge the €450 billion gap.
- Simplifying regulations and enabling market consolidation to support Europe’s tech champions.
- Enhancing education and attracting global tech talent to address skill shortages.
How Can Connectivity Drive Europe’s Competitiveness?
Europe has long been a leader in connectivity, with companies like Nokia and Ericsson at the forefront of developing advanced 5G networks. However, this leadership is now at risk due to uneven implementation of policies and insufficient investment in infrastructure.
The CEOs at the summit stressed the urgency of deploying secure and trusted networks, such as those outlined in the 5G Security Toolbox, as the backbone of Europe’s digital economy. They also called for aligning connectivity goals with the EU’s green initiatives, ensuring sustainable growth.
Christian Klein, CEO of SAP, highlighted the potential of digitalisation to boost productivity across all sectors, saying, “Policymakers can support a European tech renaissance by reducing regulatory burdens, incentivising R&D, and digitising public administration.”
What’s at Stake if Europe Fails to Act?
As the new European Commission takes office, the summit marks a critical moment to address systemic challenges and secure Europe’s position in the global tech landscape. Without immediate reforms, Europe risks falling further behind its competitors, not only in technology but also in economic resilience and geopolitical influence.
Enrico Letta, President of the Jacques Delors Institute and former Italian Prime Minister, stressed, “Investments in advanced connectivity infrastructure are essential to secure Europe’s future. Collaboration between companies like Nokia and Ericsson and policymakers is commendable, but it must be matched with swift action to implement recommendations.”
Lundmark echoed this urgency, stating, “This cannot be a decade-long endeavour. Europe must act right now on issues like telco mergers and the 5G Toolbox. If we get this right, it’s a massive opportunity.”
What Are the Next Steps for Europe’s Tech Renaissance?
The path forward requires a unified effort from policymakers, businesses, and educational institutions to create a supportive ecosystem for technological innovation. Concrete steps include:
- Fully implementing the recommendations of the Draghi and Letta reports.
- Reforming merger guidelines to allow telco consolidation and scale.
- Setting clear targets for 5G deployment while removing barriers such as high spectrum fees.
- Reshaping education systems to align with future tech needs.
Börje Ekholm summed up the challenge: “The solution is well-known. The EU must act decisively to enable the technology sector to play its part in delivering future European prosperity.”
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