Daniel Gros
Says More…
This week in Say More, PS talks with Daniel Gros, Director of the Institute for European Policymaking at Bocconi University.
Project Syndicate: You have criticized the European Union’s imposition of high tariffs on electric vehicles (EVs) from China, arguing that reducing access to low-cost green technologies defies common sense. Now, another low-cost Chinese innovation is grabbing headlines: DeepSeek’s artificial-intelligence platform. How might DeepSeek’s more “efficient” AI inform Europe’s efforts to regain global competitiveness?
Daniel Gros: While Europe would do well to welcome Chinese EVs, in order to support the green transition, one cannot deny that there are trade-offs. After all, Europe has a massive automotive industry, which employs millions of workers whose jobs would be jeopardized if Chinese cars take over the European market. To be sure, this risk tends to be exaggerated; cheap Chinese EVs would be unlikely to put European automakers out of business. Nonetheless, it is true that Chinese imports compete directly with European production.
By contrast, Europe does not produce advanced AI models like DeepSeek. So, while the Chinese startup might compete with dominant American firms (if its technology is vindicated), it does not threaten Europe’s AI industry. On the contrary, by ushering in an era of cheaper AI, DeepSeek could facilitate European industry’s adoption of AI, thereby providing a much-needed boost to its competitiveness. It is an opportunity Europe would not want to squander.