Europe earmarks €160bn for digital era investments

  • The European Commission is desperate to ensure the digital and sustainable future of the region
  • It has come up with a new scheme called STEP to fund critical technology R&D, using existing investment programmes plus a €10bn top up
  • Developments related to AI, 5G and advanced connectivity are in line for additional funding
  • The EC believes the STEP investments, including contributions from private capital, could reach €160bn by 2027

The European Commission has proposed a new four-year investment programme valued at €160bn to support the development of key digital technologies and ensure the region’s environmentally sustainable future.

Dubbed Strategic Technologies for Europe Platform (STEP), the new scheme is designed to fund the development and manufacturing of “critical emerging technologies relevant to the green and digital transitions in the EU” with a focus on what the commission calls deep tech, clean tech and bio tech.

The “deep and digital technologies” include microelectronics, high-performance computing, quantum computing, cloud computing, edge computing, artificial intelligence (AI), cybersecurity, robotics, 5G and advanced connectivity, as well as virtual reality (VR). The investments in these areas will be partially focused on the development of defence and aerospace applications.

The clean-tech focus encompasses renewable energy, sustainable alternative fuels and smart energy solutions.

STEP will also fund the creation of biotechnologies, help with “safeguarding and strengthening the respective value chains” and pledges to “steer investments in related critical raw materials” to reduce the bloc’s “strategic dependencies” and enhance its sovereignty and economic security. It also plans to address labour and skills shortages across these sectors.

The new programme builds upon existing European Union (EU) financial programmes, such as InvestEU and Innovation Fund, and acts as “a more structural answer to the investment needs” of the EU’s industries. It is being proposed as part of the bloc’s budget for the period between 2024 and 2027.

As part of the proposal, the commission has asked EU governments to contribute an additional €10bn to help achieve some of the goals outlined by STEP.

“The future of the strategic industries should be made in Europe. Today, with STEP, we set the stage to mobilise the necessary funding available across various EU programmes to stimulate investments in critical technologies and make sure companies grow and flourish in the EU,” said Ursula von der Leyen, president of the European Commission.

“With the existing funding, and an extra €10bn that we intend to inject, we aim to reach up to €160bn in investments in the coming years,” she added.

According to von der Leyen, the commission expects the €160bn target to be met by combining EC funding with “crucial” contributions from private investment firms.

The commission’s president added that this move will open the doors to the creation of a “fully-fledged” Sovereignty Fund that will focus on the promotion and development of innovation and industrial development that is “made in Europe”. 

The STEP investment plan is part of a broader EU budget proposal that needs to be adopted by the European Parliament and the European Council to come into force.

- Yanitsa Boyadzhieva, Deputy Editor, TelecomTV