The AI Summit in Paris 2025 has marked a turning point in Europe’s approach to artificial intelligence (AI). What was once a cautious strategy—focused on regulation and risk—has now shifted to an ambitious push for industrial adoption, talent development, and technological sovereignty.
With over €300 billion in public and private investments committed, the EU is aiming to close the gap with the US and China, where generative AI is advancing at a rapid pace. The message is clear: if Europe wants to secure its industrial and technological leadership, it must become a competitive player in AI development and deployment.
The European Round Table for Industry (ERT) report on Generative AI, published alongside the summit, highlights both the challenges and opportunities this technology presents for European industry. Its core message is unequivocal: Europe cannot afford to remain in the realm of theory. It is time to scale adoption, train the workforce, build robust infrastructure, and ensure AI is both safe and sustainable.
From experimentation to scale
Generative AI has the potential to boost Europe’s GDP by 8% over the next decade, yet most companies are still in the pilot phase. Use cases have been identified in sectors such as telecommunications, energy, manufacturing, and financial services, but large-scale deployment remains a challenge.
A prime example is Telefonica Kernel Digital Ecosystem, which integrates AI to enhance decision-making and customer service. By combining large language models (LLMs) with a retrieval-augmented generation (RAG) layer, Kernel ensures the secure, private, and ethical use of AI.
Large corporations are making strides, but small and medium-sized enterprises (SMEs) still face significant barriers. Without a clear strategy to democratize AI access across industries, Europe risks limiting the benefits of this technological revolution to only a handful of major players.
The Achilles’ Heel: The Skills Gap
One of the greatest obstacles to widespread AI adoption in Europe is the shortage of specialized talent. According to the ERT report, 42% of Europeans lack basic digital skills, posing a serious risk to the continent’s competitiveness.
To tackle this challenge, the Paris Summit introduced the InvestAI program, which will mobilize €200 billion to train AI specialists and upskill the broader workforce. As part of its Reskilling for Employment initiative, ERT has launched the New Career Network, a digital platform that connects job seekers, employers, and training providers.
However, these initiatives may not be enough. The rapid evolution of AI demands a fundamental rethinking of education and professional training in Europe. Without aggressive reskilling and upskilling strategies, companies will struggle to harness AI’s potential, and European talent may continue to migrate to more dynamic markets, such as the US.
Infrastructure and Technological Sovereignty: Building Europe’s AI Backbone
Scaling generative AI requires massive computing resources, an area where Europe still depends heavily on foreign providers. Today, most European companies rely on US-based cloud infrastructure, raising concerns about technological sovereignty and data security.
To reverse this dependency, the Paris Summit announced €109 billion in investments for AI factories and data centers across Europe. Additionally, the AI Continent Initiative was unveiled, aiming to expand the continent’s computational capacity and foster the development of sovereign AI models.
However, key challenges remain:
- Access to GPUs and advanced computing: The shortage of high-performance GPUs is hindering AI training in Europe.
- Data interoperability: Without a clear framework for cross-border and cross-sector data sharing, Europe’s AI development will remain fragmented.
- Lack of a competitive sovereign cloud: While the US and China continue to advance their domestic cloud infrastructures, Europe has yet to establish a viable alternative.
The ERT report calls for accelerating the implementation of the EU Cloud and AI Development Act, a proposal led by Mario Draghi to enhance Europe’s technological capacity and reduce its reliance on external providers.
Smart Regulation: Leading Without Stifling Innovation
Europe has taken a global lead in AI governance with the EU AI Act, which sets strict standards for safety, transparency, and ethical AI use. At the Paris Summit, 61 countries signed the Paris Declaration on Responsible AI, reinforcing the need for a global AI governance framework.
At the national level, some governments are going even further:
- Spain announced fines of up to €35 million for companies that fail to label AI-generated content.
- The UK is reforming copyright laws to attract AI firms while ensuring fair compensation for content creators.
- France is positioning itself as a European AI hub, combining tax incentives and R&D investments to foster innovation.
For businesses, the challenge will be balancing innovation with regulatory compliance. While regulation is crucial to build public trust in AI, overly restrictive policies could hinder Europe’s competitiveness compared to regions with more flexible frameworks.
Lead or Lag Behind?
Europe is at a crossroads. Generative AI has the potential to redefine industries, boost productivity, and revitalize the economy, but achieving this future depends on the decisions made today.
The ERT report and the Paris Summit commitments outline a clear roadmap:
- Support businesses in scaling AI adoption, with funding, regulatory clarity, and public-private collaboration.
- Invest massively in AI skills and workforce transformation, ensuring employees see AI as an opportunity rather than a threat.
- Build a robust AI infrastructure, securing data centers, GPUs, and sovereign cloud solutions to reduce reliance on non-European providers.
- Ensure AI is sustainable and responsible, aligning technological advancements with environmental goals.
- Establish a regulatory environment that balances security and innovation, avoiding restrictive barriers while strengthening Europe’s position in AI governance.
Time is of the essence. As China and the United States solidify their leadership in AI, Europe has a window of opportunity that it cannot afford to miss. With the right strategy, Generative AI could become the driving force behind Europe’s industrial revival. However, if decisions take too long, the continent risks falling behind in the greatest technological revolution of our time.
