Lagarde Urges Europe to Build AI and Datacentres as US Holds 75% of Computing Capacity
Updated
Updated · The Guardian · Sep 14
Lagarde Urges Europe to Build AI and Datacentres as US Holds 75% of Computing Capacity
3 articles · Updated · The Guardian · Sep 14
Summary
Christine Lagarde said Europe needs domestic AI models and more datacentres to avoid being cut off by the US or China, warning access to foreign-controlled systems could become leverage in disputes over tariffs or digital taxes.
Europe now has just 5% of global AI computing capacity versus 75% in the US, while the US produced 59 notable AI models last year and China 35; France and the UK produced one each.
Lagarde said the bloc faces an "awkward choice": delay AI adoption to protect data and lose growth, or adopt quickly and become dependent on foreign providers across banking, transport, healthcare and border controls.
AI could lift productivity by up to 4% over a decade, she said, but Europe already lacks enough datacentre capacity and the shortfall is projected to widen more than sixfold within 10 years.
The 5% vs. 75% Compute Gap: How Energy, Gridlock, and US Dominance Threaten Europe’s AI Future
Overview
Europe’s AI landscape is being reshaped as private capital, led by major US tech firms like Google, shifts investment from traditional hubs facing power and land shortages to emerging markets in the Nordics and Southern Europe. This migration is driven by the need for abundant renewable energy and faster development, as seen in Finland and Portugal. However, Europe still lags far behind the US in AI compute capacity and private investment, leaving startups and researchers struggling with access gaps and heavy regulatory burdens. Despite new EU initiatives like AI Gigafactories and the Cloud and AI Development Act, high energy costs, grid bottlenecks, and chip dependencies continue to threaten Europe’s digital sovereignty and competitiveness.