Christine Lagarde calls on Europe to develop its own AI technology for strategic autonomy and increased productivity

Europe must develop its own production capacity in artificial intelligence to protect its autonomy and maintain its standard of living, European Central Bank President Christine Lagarde said on Monday in a speech delivered in Vienna.

Lagarde warned that European companies’ dependence on imported technology, particularly from the United States, could become a major risk if access to these services is restricted or the terms of use change. Within a few years, artificial intelligence could inspect goods at the border, coordinate trains, monitor patients, decide which tax returns are audited and process bank payments.

According to the ECB chief, a potential interruption of access would affect numerous sectors simultaneously and give trading partners unprecedented leverage in negotiations over tariffs or digital taxes. The risks are heightened by recent tensions between the European Union and the United States, including trade disputes and political differences.

Lagarde’s proposed solution is the rapid development of European computing and processing infrastructure, as well as AI models capable of handling most tasks and operated on local infrastructure. If adopted quickly, artificial intelligence could increase productivity by up to 4% over the next ten years.

Europe nevertheless has insufficient data-center capacity, and the shortfall is expected to grow more than sixfold over the next decade. Lagarde also drew attention to Europeans’ financial exposure to the American technology boom through pension funds’ investments in US companies’ shares.