Annual Report 2025 - Report - Page 90
Research and Innovation in a Tripolar World
How to Catch the Train
You’ve Missed
Hardly anyone knows Europe – and its competitive weak spots – better than Mario
Draghi. In September 2024, he had set out the case for radical innovation in the aptlynamed “Draghi Report”. Almost a year later, he voiced unmistakable concerns about
execution in his Rimini speech. Only a few days after the event, he brought his ideas to
Lindau and entered a dialogue with Laureates, industry leaders, and former ministers
during the opening panel of the 8th Lindau Nobel Meeting in Economic Sciences.
“If you are not at the frontier of tech, you’re not sovereign anymore.” Jean Tirole’s opening line set a blunt tone
for the charged and unsentimental Meeting opening
panel moderated by ERC president Maria Leptin. Joining
him and Mario Draghi were former US Energy Secretary
Steven Chu, and Thomas Schafbauer, an executive at Infineon – Germany’s leading semiconductor maker. Each
brought a distinct perspective from science, policy, and
industry – but all circled around a shared anxiety: Europe
risks becoming the “plus one” in a world dominated by
the US and China.
When the debate turned to Europe’s innovation system, one frustration kept recurring – fragmentation. The
US and China act like single nations; the EU remains a
patchwork of programmes, agencies, and national agendas. Europe spends roughly the same share of GDP on
research as the US, Draghi noted, yet achieves less because funds are diluted across too many layers and institutions. The political reflex to “give a little to everyone”
has created a landscape of mediocre centres rather than
world-leading ones.
Schafbauer was even more direct: in AI, Europe has
already missed the train. “It’s the US and China now com88 | Debating Economics With a Purpose
peting on large language models,” he said, urging Europe
to focus its bets instead of scattering resources across
dozens of small projects. His example: Germany hosts
several quantum computing centres, dividing talent and
funding – while only one or two will ultimately matter.
Leptin agreed: Europe’s lack of scale cripples competitiveness. Where the US sustains three telecom giants nationwide, Europe has three per country – too small to finance
bold, risky research.
Still, fragmentation isn’t inevitable. Europe can pool
resources and specialize. Schafbauer cited Taiwan: small,
focused, and now the undisputed leader in semiconductors. Europe too must choose where to excel – power semiconductors, energy efficiency, quantum sensing, or materials science – and commit deeply. Draghi underlined the
importance of urgent measures in Europe: “What should
European governments do in order not to miss the train
which has left to at least catch some of the wagons?”
Steven Chu offered a sobering comparison between
the hunger he saw in China’s workforce and the complacency seeping through the US and Europe. He recalled
calling Chinese suppliers who answered at midnight, eager for business – an intensity rarely mirrored in the West
