From niche innovations to global powerhouse: An EU quantum strategy

On November 12^th, the EU’s Technology Commissioner, Henna Virkkunen, singled out quantum technology as a field where the European Union has many reasons for optimism. She has pledged to introduce a new strategy to boost the technology. This is the right moment for such a European initiative.

Why quantum technologies matter

Quantum technologies are transitioning from research and development (R&D) to practical commercial and military applications. This holds significant economic and strategic potential. 

• Quantum computing can solve complex problems that are currently intractable for classical computers. This can supercharge innovation breakthroughs in drug discovery, materials science, and financial modelling. Quantum computers can break current encryption methods, making existing data security frameworks obsolete.
• Quantum communication offers ultra-secure communication channels using quantum key distribution (QKD). For industries such as finance, government, and healthcare, maintaining data integrity is paramount.
• Quantum sensors can provide unprecedented precision in measurements, benefiting industries such as medical imaging, navigation, and environmental monitoring. This precision can lead to more efficient and cost-effective solutions.

In the next five to ten years, those at the forefront of these technologies will gain a significant competitive edge, both financially and militarily. Countries without quantum technology or dependent on rivals for access to it risk falling behind in innovation, jobs, and security. Quantum is becoming a vital frontier in global competition.

The EU in the race for global quantum leadership

Commissioner Virkkunen is right in stating that the EU holds strong cards in quantum technology. It hosts thriving ecosystems that produce promising technological innovations and commercial applications. However, it also faces serious challenges in fulfilling its claim for global leadership.

Innovation gaps

Technological breakthroughs require years of R&D. Despite the EU’s pride in its academic leadership, few EU institutions rank among the world’s top quantum research centres (at universities in Copenhagen, Paris, Munich, and Delft). US institutions like Caltech, MIT, and Harvard, dominate the list, along with universities from non-EU countries, such as the United Kingdom and Switzerland. Accelerating R&D investments would help close this gap.

Investment shortfalls

Quantum technology thrives through a combination of academic research and innovative start-ups. Public and private funding in the EU lags behind the United States and China. Promising European start-ups have been moving across the Atlantic for easier access to private equity. The former European Central Bank president, Mario Draghi, urged the EU earlier this fall to further boost its investment in quantum technology and facilitate access to European private equity for start- and scale-ups.

Security risks

Quantum computing has both civilian and military uses. This ‘dual-use’ potential raises national security concerns that necessitate protective measures, such as export controls, FDI screening and research security. But, the European economic security architecture is still in its early stages. It is also fragmented across member states, while the US and China are acting rapidly and decisively, for instance, by issuing export controls. The EU needs to equip itself with the tools to play its part in that global game.

Mapping the EU’s quantum sector

The EU lacks a comprehensive understanding of quantum technology’s critical supply chains, potential choke points, and its own strengths and weaknesses. Its quantum sector consists primarily of smaller ecosystems in the five member states that have formulated full-fledged national quantum technology strategies: Denmark, France, Germany, Ireland, and The Netherlands. Instead of big corporations, the EU has start-ups and some successful scale-ups, such as Bluefors in Finland and TOPTICA in Germany. These companies excel in niche areas like lasers and cryogenic technology but need coordinated support to scale globally.

The EU cannot nurture these niches because it does not have a quantum strategy, which prevents informed decision-making. Mapping European quantum technology value chains is complicated because relevant data is not easily available. Previous efforts have established that European firms have an edge in lasers, cabling and refrigerators, but the rapid evolution of the technology keeps the sector in a state of flux.

A solid foundation… 

Having exclusive technology can give the EU leverage. Brussels can withhold it from rivals or share it selectively with allies in exchange for their cutting-edge technology. To achieve global leadership in quantum technologies, Europe needs a strategic approach. The following three goals can be the foundation for a solid strategy. 

Having exclusive technology can give the EU leverage. To achieve global leadership in quantum technologies, Europe needs a strategic approach

Indispensability: Control of critical quantum-enabling technologies and components, such as cryogenic technology and lasers, would make the EU indispensable to other tech ecosystems. Indispensabilitycan emerge from superior R&D, intellectual property, equipment, or successful commercialisation. 

Allied leadership: The EU should aim to lead the development and commercialisation of quantum technologies in partnership with its allies. One way to do that would be to coordinate innovation and technological advances along an ‘allied’ quantum supply chain.

Security: Europe’s quantum sector must reduce reliance on strategic rivals for critical inputs and avoid transferring sensitive technology to competitors.

… for a European strategy 

Working towards these goals, the European Commission should increase the Quantum Flagship budget, a long-term research and innovation instrument, and encourage member states to boost national investments. Better coordination is key. The EU should create a central body to streamline regulations, align programmes, share best practices, and facilitate collaborations like the Franco-German-Dutch quantum partnership.

For quantum technologies to thrive, there must be a market willing to adopt these innovations early. The EU and member states should create incentives for the early adoption of quantum technologies in the public and private sectors. European quantum companies can also be more effective and scalable by improving their interoperability.

The EU should finally deliver a European capital market to support start-ups and scale-ups. Promotive funding should focus on areas of EU strength—such as lasers and cooling systems. These areas would enhance the bloc’s ability to shape the technology battlefield of the future. More generally, mapping the strengths of the EU quantum market will help allocate limited resources more effectively.

Finally, coordination of export controls and other economic security measures would strengthen the EU’s position and ensure collaboration with global partners for further technological advancement.

Henna Virkkunen’s comments are timely. A strategy is necessary. Europe must act now to secure its quantum future.