EU Initiates Risk Assessment of Outbound Tech Investments to Safeguard Economic Security

EU Launches Initiative to Assess Outbound Tech Investments

The European Commission has taken a significant step towards safeguarding its economic security by requesting its 27 member states to conduct a comprehensive risk assessment of outbound investments in critical technologies. This 15-month review process, announced on Wednesday, focuses on investments in semiconductors, artificial intelligence (AI), and quantum technologies 1.

Scope and Timeline of the Assessment

The assessment will cover investments made by EU companies in non-EU countries, dating back to the beginning of 2021. Member states are expected to provide a progress report by July 2025, with the final report due in June 2026. This initiative is part of a broader strategy to enhance the EU's economic security, which was initially outlined a year ago 1.

Motivations Behind the Initiative

The EU's decision to scrutinize outbound investments stems from various factors:

1. Lessons learned from the COVID-19 pandemic
2. Geopolitical tensions, including Russia's invasion of Ukraine
3. Increased cyber and infrastructure attacks
4. Concerns about potential risks during a second term of President-elect Donald Trump

A primary concern for the EU is the potential leakage of sensitive technologies that could be exploited by hostile military or intelligence services 1.

Focus on Critical Technologies

The risk assessment specifically targets three key technological areas:

1. Semiconductors
2. Artificial Intelligence (AI)
3. Quantum technologies

These sectors are considered crucial for the EU's future economic and strategic interests 2.

Potential Outcomes and Future Actions

The European Commission has stated that this review will inform decisions on whether further action is needed at EU and/or national levels to address any identified risks. The initiative aims to prevent key technologies from "falling into the wrong hands" and to boost the bloc's overall economic security 2.

Broader Context of EU Economic Security Measures

This risk assessment initiative is part of a larger set of plans announced by the EU a year ago. These plans include:

1. Closer scrutiny of foreign investments
2. More coordinated controls on exports
3. Monitoring of technology outflows to rival nations, with a particular focus on China

The EU's approach reflects a growing awareness of the need to protect strategic assets and technologies in an increasingly complex global landscape 1.