The European Commission has unveiled a preliminary list of four technology areas that have the highest risk of being misused to prop up autocratic regimes and violate human rights.
Cutting-edge microchips, AI-powered systems, quantum computing and genetic engineering will be put under the microscope to determine whether their exports and imports represent a danger to the security of the European Union as a whole.
The internal analysis will entail close and intense consultations with the 27 member states and the private sector in order to present a final list of high-risk technologies sometime in the spring.
The designation could open the door for potential restrictions, including trade bans and investment screening, although any such step will be certainly met with the contestation of some capitals reluctant to have Brussels interfere in matters of national security.
The selection presented on Tuesday is the first tangible result of the “de-risking” strategy pioneered by European Commission President Ursula von der Leyen with the goal of decreasing the plethora of vulnerabilities and dependencies that the bloc has accumulated across several decades of free-market complacency.
Von der Leyen originally proposed “de-risking” in the context of EU-China relations, which have taken a sharp turn for the worse due to the repression of Uyghurs in the Xinjiang region, the origins of the COVID-19 pandemic, Russia’s war against Ukraine and continued tensions in the Taiwan Strait, among other sources of friction.
China is, quite notably, not mentioned by name in Tuesday’s document, even if its shadow looms over the unprecedented exercise of reviewing technologies through the lenses of national and economic security.
The EU, together with its G7 allies, has accused Beijing of doubling down on the repression of its own citizens while adopting more assertive behaviour in its international relations, often resorting to coercion, retaliation and disinformation.
But dealing with China is a treacherous road, as the country controls crucial shares of the raw materials and manufactured products that are indispensable to decarbonise and modernise the economy, including solar panels, batteries and electric cars, and has no qualms in weaponising these valuable supply chains to punish its critics.
‘A player, not a playground’
Brussels wants to build buffers in case the EU falls victim to this sort of reprisals, where entrenched dependencies are turned against national security, wreaking havoc across entire industries and endangering thousands of jobs.
“Technology is currently at the heart of geopolitical competition. And the EU wants to be a player, not a playground,” Věra Jourová, the European Commission’s vice president for values and transparency, said during the presentation.
“This is not against any country. We do what we believe it’s in the general interest of our fellow citizens,” said Thierry Breton, the European Commissioner for the internal market, speaking next to her. “When we see there is a risk of over-dependency, a risk of breaking a supply chain which could be critical for us, we take actions, we don’t wait.”
The risk assessments launched on Tuesday are meant to glean greater insights into four key technology areas, which were hand-picked due to their ever-evolving, transformative nature and their “imminent” potential to be misused for military purposes and violations of human rights, such as mass surveillance. These are:
- Advanced semiconductors, including microelectronics, photonics, high-frequency chips and semiconductor manufacturing equipment.
- Artificial Intelligence, including high-performance computing, cloud and edge computing, data analytics, computer vision, language processing and object recognition.
- Quantum technology, including quantum computing, quantum cryptography, quantum communications, and quantum sensing and radar.
- Biotechnology, including techniques of genetic modification, new genomic techniques, gene drive and synthetic biology.
Member states, experts and representatives of the private sector will participate in this internal analysis and submit feedback, comments and, ideally, confidential information that can provide a richer view of the pitfalls and side effects of these technologies.
Based on the consultations, Brussels will present in spring a final list of the most sensitive technologies, which could be shorter than the aforementioned selection.
In parallel, there will be talks on six other “critical” technology fields that could also be subject to a risk assessment sometime in the future, but not immediately. This group encompasses many well-known products, such as virtual reality, cyber-security, sensors, space navigation, nuclear reactors, hydrogen, batteries, drones and robotics.
“Be certain that we will continue, aiming for all the rest,” Breton said.
Controlling and screening
What will happen after the final list is published is only a guessing game.
Senior Commission officials have floated three possibilities: promote homegrown alternatives, partner up with like-minded countries and protect against economic threats. It’s under this last option – protect – that the bloc could impose trade restrictions.
ADVERTISEMENTThe Netherlands paved the way earlier this year when it blocked exports of advanced microchip technology destined for China, arguing they could be used for “undesirable” purposes. The Dutch decision influenced the Commission’s drafting of its first-ever economic security strategy, adopted in June.
As part of this strategy, the executive is working on a mechanism to screen outbound investment flows, meaning the investment projects that EU companies carry out outside the bloc’s borders. The tool, set to be unveiled before the end of the year, will only apply to investments with a high risk of know-how leakage and security threats.
Both avenues – stricter export controls and outbound investment screening – are all but guaranteed to face the resistance of certain member states who are loath to alienate Beijing out of fear of losing access to the lucrative Chinese market.
An anti-subsidy inquiry recently launched by the Commission into China-made electric cars has received mixed reviews in Berlin. “Our economic model should not be based or rely on protectionism – but on the attractiveness of our products,” German Chancellor Olaf Scholz said last week in an interview.
Still, the mere fact that Brussels is openly speaking about trade flows in national security terms reflects a seismic change of thinking across the continent, where open markets and low tariffs were once seen as the prelude to the spread of liberal democracy.
ADVERTISEMENTThat naivety appears to have vanished, almost entirely, and been replaced with a hard-boiled vision of a world where technology ruthlessly defines leaders and laggards.
“Overall, these stringent policies demonstrate how Western countries are willing to enforce intrusive measures that were unthinkable only a few years ago,” said Agathe Demarais, a senior policy fellow at the European Council on Foreign Relations. “However, getting companies on board with de-risking efforts will likely prove difficult. Despite the de-risking hype, two-thirds of EU firms have no plans to shift away from China.”