EU countries and the UK are embracing open source for technology independence
The EU and the UK are accelerating efforts to reduce dependence on dominant US tech giants by championing open source technologies and digital sovereignty, fostering a new era of tech independence and innovation.
The shift
At the heart of Europe’s strategy is the ambition to reclaim control over digital infrastructure, data and software. This digital sovereignty movement prioritises open source as a foundation, offering transparency, security and autonomy from proprietary US platforms. European governments and enterprises aim to build sovereign cloud infrastructures and open-source AI initiatives that comply with stringent regional regulations like GDPR.
Spain, Germany, France, Italy and others are leading with policies and public investments that promote sovereign technology ecosystems. Regions like Germany’s Schleswig-Holstein have pioneered open-source transitions and national cloud programmes are beginning to emphasise local data residency and open infrastructure.
Economically, open source contributes between €65 billion and €95 billion annually in the EU, promising significant job creation and investment returns. Politically, the Digital Markets Act and cybersecurity legislation reinforce digital autonomy as essential for Europe’s future competitiveness.
Draghi’s vision
Former Italian Prime Minister Mario Draghi’s landmark 2024 report, commissioned by the European Commission, presents a clear and urgent vision for Europe’s future competitiveness. Draghi warns of Europe’s slow economic growth and technological lag behind the US and China, highlighting the existential challenge of regaining technological leadership.
His report calls for €800 billion in annual investments, about 4-5% of EU GDP, to unite capital markets, accelerate innovation in AI, green technologies and defence, and harmonise regulations to support startups and scale-ups across all member states. Draghi emphasises creating large strategic deep tech initiatives akin to DARPA to focus on high-risk, high-reward projects managed by industry experts, not bureaucrats.
Despite some progress, only 11% of these recommendations have been implemented by 2025, constrained by geopolitical tensions and delayed regulatory reforms. Yet, Draghi’s report remains a cornerstone of EU policy, driving initiatives like the Competitiveness Compass and the Clean Industrial Deal, aiming to cultivate a digitally sovereign, economically robust Europe.
The UK’s ambitions
Despite Brexit, the UK remains a committed player in digital sovereignty, launching ambitious programmes like the £500 million Sovereign AI Unit and the UK Compute Roadmap. The government aims to transform its compute ecosystem, scaling national champions in AI and cloud infrastructure.
UK-based companies such as Civo, Nine23 and SAP are developing sovereign cloud platforms focusing on data security, low-latency AI applications and government-level accreditations.
Cybersecurity growth and innovation also remain priorities, with the UK’s Cyber Growth Action Plan galvanising industry and government collaboration to build cyber resilience.
Cross-channel collaboration
The UK and EU collaborate on digital sovereignty despite political boundaries, sharing goals to enhance secure digital infrastructure, AI innovation, and sovereign cloud solutions. Summits in 2025 reaffirmed commitments to joint development, interoperability and trusted partnerships. Initiatives involve AI-powered tools and secure data environments co-developed by UK and EU stakeholders, supported by organisations like techUK, which promote engagement and policy alignment.
Business and investor opportunities
The digital sovereignty shift opens vast opportunities across Europe and the UK:
- Businesses supplying secure, transparent, open-source software and cloud services benefit from growing public sector demand and digital transformation
- AI startups and scale-ups, particularly those focused on sovereign computing and compliance-driven innovation, represent promising investment targets
- Sovereign cloud providers are strategically positioned to gain market share as governments and enterprises prioritise data sovereignty
- Investors can leverage public funding initiatives and the rising need for European technology autonomy to back companies driving the continent’s tech independence
Impact on ESG
European businesses and investors tend to prioritise sustainability more deeply than many of their US counterparts. This shift to digital sovereignty is expected to advance Environmental, Social and Governance (ESG) outcomes simultaneously. Environmentally, sovereign cloud infrastructures are designed with strict green standards in mind, reducing energy consumption and promoting renewable sources. Socially, strengthening data privacy, security and transparency builds trust and inclusivity across digital ecosystems. From a governance perspective, controlling digital assets locally reduces dependence on foreign entities, enhancing resilience and accountability. Together, these factors mean that Europe’s move towards open source and sovereignty should deliver not only technological autonomy but also better outcomes for the planet and society.
Final thoughts
The EU and UK’s strategic focus on promoting open-source technological sovereignty reshapes the digital landscape, presenting opportunities for businesses and investors aligned with ESG principles. This shift supports sustainable technological growth, enhances societal trust and improves governance structures – critical factors for long-term resilience and competitiveness. As these regions continue to prioritise digital autonomy, companies that adopt sustainable, transparent and ethically aligned practices will likely emerge as leaders in the evolving global tech ecosystem.
To learn how we can help wealth managers better use technology:
