The European Investment Bank (EIB) and European Commission published a new study, on Tuesday, on the state of play in artificial intelligence (AI) and blockchain technologies in the European Union (EU).
The study, titled “Artificial intelligence, blockchain and the future of Europe: How disruptive technologies create opportunities for a green and digital economy”, was produced by the EIB’s Innovation Finance Advisory team.
It was created in close collaboration with DG CONNECT under the InnovFin programme, a joint EIB and European Commission initiative to support Europe’s innovators.
AI and blockchain technologies have the potential to revolutionise the way people work, travel, relax, and organise societies and day-to-day lives. They are already improving the world, with AI crucial in speeding up the development and production of vaccines against the novel coronavirus (COVID-19).
Meanwhile, blockchain has the potential to not only disrupt the financial system, but also help track and report greenhouse gas emissions better, optimise commercial transport, and create genuine data privacy protection.
The further development of both technologies, guided by ethical and sustainability principles, has the potential to create new pathways for human growth. This includes driving technological solutions to make societies truly digital and greener, and ultimately keep the planet habitable.
The report shows that, in comparison to major global competitors, the EU is falling behind in developing and deploying AI and blockchain technologies. To catch up, however, it can build on its leading role in high-quality research and its vast pool of digital talent.
“The real added-value of artificial intelligence and blockchain still lies ahead of us, in industrial, business and public applications, and this is where Europe can catch up and even take the lead,” said EIB Vice-President Teresa Czerwińska, who is responsible for the EIB’s innovation investments, ”At the same time, we need to make sure that the development of these technologies is focused and respects our European values.”
She noted that there is a need to increase joint efforts, and to make this happen, the study shows that amongst other things, there is a need to invest more and faster, especially in later-stage startups.
With the EIB Group, EU countries have the ideal instrument at hand to boost and scale up the development of data-driven solutions. This would also bring excellence in research to the market, and help build a greener, smarter society, and thus a stronger Europe.
Roberto Viola, Director General of DG CONNECT and Directorate General of Communication, Networks, Content, and Technology at the European Commission, said, “AI and blockchain technologies are critical for fostering innovations, competitiveness, and sustainable economic growth.”
“They offer unprecedented opportunities as key enablers of the digital and green transformation,” he added, “It is thus essential to boost investments in both the development and adoption of these breakthrough technologies in Europe.”
The study shows that the highest number of small- and medium-sized enterprises (SMEs) involved in AI and blockchain can be found in the US (2,995), followed by China (1,418) and the 27 EU countries (1,232).
The UK is another notable player with 495. Within the EU, the highest number of companies are located in Germany and Austria, followed by southern Europe, France, and central, eastern and south-eastern Europe.
For available financing, it already seems to be a two-horse race between the US and China, who together account for over 80% of the €25bn in annual equity invested in AI and blockchain technologies.
The EU accounts for only 7% of this total, investing around €1.75bn per year. Overall, according to the study, the estimated investment gap in AI and blockchain technologies in Europe could be as much as €10bn annually.
One explanation for this gap is the limited role played by large institutional investors such as pension funds, insurers, and endowments in financing later-stage startups involved in artificial intelligence and blockchain.
The study shows that the business environment overall in the EU harbours strong potential for competing with the US and China. The EU has more specialised researchers than its peers, and typically produces the most technology-related academic research.
Some Member States are performing strongly in the digital segment, indicating that the region is in a good position to deploy AI and blockchain technologies across different sectors.
Europe also has the largest talent pool of researchers in AI, with an estimated 43,064 in the field (of whom 7,998 are in the UK), compared with 28,536 in the US, and 18,232 in China.