The European Union has announced a €1.3 billion investment to support artificial intelligence, cybersecurity, and digital skills as part of the Digital Europe Programme for 2025-2027. The funding package represents a significant portion of the programme’s total €8.1 billion budget through 2027, building upon the EU’s existing digital identity and authentication initiatives, including the ongoing development of its digital identity ecosystem.
The investment will focus on several key technological areas, including supercomputing, cloud infrastructure, and quantum communication. A major emphasis of the funding will be ensuring that new technologies comply with the EU’s AI Act and related digital regulations. The quantum communication aspect follows recent industry developments, such as Vodafone and IBM’s collaboration on quantum-safe security for mobile networks.
The initiative corresponds with the enforcement timeline of the EU’s AI Act, which entered into force in August 2023. The first major enforcement milestone occurred on February 2, 2025, implementing bans on “unacceptable risk” systems. Requirements for general-purpose AI models will take effect on August 2, 2025, with full implementation of the AI Act following on August 2, 2026. High-risk systems will have until 2027 to achieve compliance.
“Securing European tech sovereignty starts with investing in advanced technologies and in making it possible for people to improve their digital competences,” said Executive Vice-President for Tech Sovereignty, Security, and Democracy Henna Virkkunen. “With the opportunities under the Digital Europe Programme, we are ensuring that new technologies – and with them new potential – reach European citizens, businesses and public administrations.”
The European Commission is working to streamline regulatory requirements by assessing overlaps between the AI Act and other legislation, including the Digital Services Act and Digital Markets Act. The effort aims to simplify compliance procedures for businesses while maintaining regulatory effectiveness. The integration effort builds on previous regulatory harmonization work, including the ITIF’s recommendations for digital identity solutions in the Digital Services Act.
Industry response to the EU’s regulatory approach has been mixed. A coalition of 150 European companies, including Airbus and Renault, expressed concerns in June 2023 about potentially restrictive AI regulations driving innovation outside the EU. The regulatory framework has also increased scrutiny of foreign AI developers, particularly regarding privacy and national security considerations. The developments come as the EU continues to advance its digital sovereignty agenda, exemplified by projects like the EU Digital Identity Wallet, which is set to begin beta testing in Italy.
Sources: TechStartups.com, CyberPeace.org, Winbuzzer.com
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