Europe’s digital gap with the world’s leaders is now being compounded by an emerging gap with the world’s leaders in its development and adoption of artificial intelligence (AI) technologies. Without faster and more comprehensive engagement in AI, that gap could widen. Europe may not need to compete head to head but rather in areas where it has an edge (such as in business-to-business [B2B] and advanced robotics) and continue to scale up one of the world’s largest bases of technology developers into a more connected Europe-wide web of AI-based innovation hubs.

To scale up and close the gap with the world’s AI leaders, this Mckinsey discussion paper says Europe will need to focus on five priorities: (1) continued development of a Europe-wide, vibrant ecosystem of deep tech and AI startups; (2) acceleration of digital transformation and AI innovation among incumbent firms; (3) progress on the digital single market; (4) fundamental development of research, education, and practical skills; and (5) bold thinking about how to guide societies through the potential disruption.