Christine Lagarde, President of the European Central Bank (ECB), has urged Europe to develop its own artificial intelligence (AI) technology and expand its datacentre infrastructure. This move is deemed necessary to counter the potential threat of being cut off from AI resources by the US or China.
Ms Lagarde emphasised the need for Europe to have AI models capable of performing most tasks, running from datacentres within the continent. She stated that investing in domestic AI technology would reduce the leverage that other trade partners could hold over Europe.
In a speech in Vienna, the ECB boss highlighted the current disparity in AI development, noting that the US produced 59 significant AI models last year and China 35, while France and the UK each produced one. She also pointed out that the US accounts for 75% of global AI computing capacity, compared to Europe's 5%.
Ms Lagarde warned that a withdrawal of access to AI, or a change in its terms, could have an immediate and widespread economic impact across all sectors, from border screening and tax audits to train dispatch and banking payments. She described this as unprecedented leverage that could be used in negotiations on issues such as tariffs or digital taxes.
She also noted that Europe already has insufficient datacentre capacity to meet its own demand, a gap projected to increase more than sixfold within a decade. Rapid AI adoption could boost productivity by up to 4% over ten years, which would be transformative for public finances.