The European Union is looking to counter President Donald Trump’s aggressive trade war with tariffs, as well as investing in European tech companies in a move to compete with ever-expanding Silicon Valley.
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In a document obtained by POLITICO, European Commission officials are pressuring their president-elect, Ursula von der Leyen, to create a fund that would invest $100 billion into “high-potential” European companies, all to compete with American and Chinese technology companies which have dominated the tech market worldwide for decades.
The 173-page plan drafted by EU officials suggests a self-awareness that Europe has slipped in terms of global economic authority, and the leaked document shows an aggressive plan to compete with China and the US in the technology industry, as well as potential unilateral tariffs on the United States in retaliation for Trump’s trade war.
When it comes to technology, European countries have long lagged behind the likes of American tech powerhouses like Google, Facebook, Apple, Microsoft and Amazon, which hold a market capitalization occasionally nearing $1 trillion.
Even Europe’s biggest tech company, Spotify, is still 100 times less valuable than its’ U.S. counterparts. But with the specter of market-driven Great Britain leaving the EU on Oct. 31, the rest of the European Union will soon be free to implement more interventionist-based economic policies.
China, too, is in the EU’s crosshairs in regard to economic and technological competition, with Chinese companies such as Baidu and Tencent identified in the 173-page document as entities that have no similar peers in Europe.
“Europe has no such companies,” the document reads.
In what appears to be an act of economic self-preservation, the EU proposal will look to block Chinese companies from providing services to European businesses.
“The emergence and leadership of private non-EU competitors, with unprecedented financial means, has the potential to obliterate the existing innovation dynamics and industrial position of EU industry,” the proposal notes.
The plan also includes potential tariffs on American goods that the EU would employ in retaliation should the Trump administration succeeds in undermining the World Trade Organization.
Trump’s policy has been to deprive the WTO of the judges necessary for it to operate the international trade arbitration court, and the planned EU counter-offensive of imposing tariffs on the U.S. makes for a contentious future for the global economy.