Europe vs. China's battle in robotics investment

Europe vs. China's battle in robotics investment
Europe vs. China's battle in robotics investment

We show you our most important and recent visitors news details Europe vs. China's battle in robotics investment in the following article

Hind Al Soulia - Riyadh - By Christopher Dembik

DUBAI — The pandemic served as a wake-up call to European governments on the urgent need to reduce economic dependence on the rest of the world, notably Asia. Many European leaders, including French President Emmanuel Macron, have highlighted the urgency to relocate strategic supply chains in Europe.

The EU is broadly self-sufficient, especially in agricultural commodities, but it is not certain it can regain autonomy in other products and goods where it is not self-sufficient yet. Relocation takes time, requires a lot of political will and a solid pre-existing industrial base in the host countries. It is especially necessary to reach a high level of robotization in factories in order to increase efficiency in production.

In the chart (provided with the article), we have plotted robotics investment defined as the supply of industrial robots per year for the main global economies based on data released by the International Federation of Robotics. It appears that the EU as a whole has made progress in this area over the past years, reflecting mostly an acceleration in robotization in CEE, but it is still lagging significantly behind China in robotics investment.

This year, the supply of industrial robots is expected to reach 82K in Europe versus 250K in China. China is investing three times more than Europe in the key segment of industrial robots. Based on a country by country basis, the gap is even worse. France’s flat curve should not mislead you.

The country has started to really invest in robotics since 2015-16 on the back of fiscal incentives, but the results are still too insufficient. In 2020, France will invest four times less than Germany — which certainly provides some explanation for why the country is lacking competitiveness.

And things are unlikely to change anytime soon for Europe. In the context of the seven-year Multi Financial Framework currently negotiated at the EU level, and that should be discussed by President Macron and Chancellor Merkel at Meseberg, we estimate that the total package allocated to reduce reliance on extra-EU trade and push to supply chain relocation would represent, at best, 0.08% of EU GDP per year – mostly as part of the Horizon Europe Program.

The least we can say is that it is clearly not enough to reduce economic dependence on Asia and especially China.

— The writer is head of macro analysis at Saxo Bank


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