Europe is ready for strategic autonomy, but at what cost?

South China Morning Post · Feb 27, 2026 · Collected from RSS

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This year’s Munich Security Conference arrived as less of a shock to Europeans, who have largely accepted that the good old days are gone for good. A few might still have got teary-eyed when US Secretary of State Marco Rubio described America as eternally “the child of Europe”, but most in the audience understood the underlying message: “You are on your own now, Granny.”The difference between Rubio’s more measured phrasing and Vice-President J.D. Vance’s blunt remarks last year is largely a matter of syntax. “Nobody doubts the good old days are over and we need to look after ourselves. Rubio and Vance are, in fact, saying the same thing,” one European diplomat observed.Officials, experts and academics I’ve spoken with during my recent visits to Munich, Berlin and Brussels agree on two imperatives: Europe must urgently regain its competitiveness and achieve strategic autonomy. The consensus holds that Europe now lags behind the United States and China, particularly in technology and advanced manufacturing. Without reclaiming its competitive edge, the continent will enter major-power negotiations from a position of weakness.Make no mistake: the EU still excels in basic research and innovation, but it remains painfully slow to translate breakthroughs into market-ready products.Part of the problem stems from well-documented overregulation. For instance, it would cost a small or medium-sized business €200,000 to €500,000 (US$235,000 to US$590,600) just to go through the compliance process required by the EU AI Act to deploy an AI system considered “high risk”.Market fragmentation compounds the challenge: legal frameworks, tax regimes and business practices vary significantly across the 27 member states, hindering European tech firms from scaling as rapidly as their American and Chinese counterparts.