The global race for artificial intelligence (AI) supremacy is shifting and Europe is at a pivotal moment. The continent has been a leader in AI regulation for years, ensuring ethical guidelines and oversight while the United States and China pursued rapid technological advancements. However, with the return of Donald Trump to the White House, the US may be headed for a period of policy uncertainty, funding cuts and deregulation. If Europe acts decisively, it could turn this moment into an opportunity to regulate AI while leading its development, research and implementation.
Trump’s previous administration deprioritised scientific research, reduced public funding for key institutions and undermined international cooperation in technology. Many experts fear that his second term could further weaken American leadership in AI, notably if the US government reduces research funding, increases hostility toward foreign talent or takes an unpredictable stance on AI safety and governance.
At the same time, American companies remain dominant in AI, mainly through firms like OpenAI, Google and Anthropic. While Europe has a vibrant research community, it lacks the commercial giants that drive AI breakthroughs. However, if Trump’s policies disrupt the US research ecosystem, top scientists may look elsewhere for stability. This is where Europe can step in but only if it moves beyond regulation and actively fosters AI leadership.
For Europe to become a true AI powerhouse, it must address several key weaknesses: research funding complexity, lower salaries for scientists, fragmented infrastructure and weaker industry collaboration. While European universities produce world-class research, many of their AI experts work for American companies or move abroad due to better pay and more funding opportunities.
For example, the European Research Council (ERC) provides some of the world’s most prestigious grants but its complex application processes and low success rates discourage many researchers. European salaries for experienced AI jobs fall behind those in the US by more than €100,000 in most cases. This makes it hard to retain top talent.
Europe’s AI ecosystem also struggles with infrastructure investment. The EU’s digital economy remains behind in key areas such as cloud computing, semiconductors and computing power. US tech firms benefit from a more extensive funding network, including venture capital and industry partnerships that accelerate innovation.
In contrast, European AI startups often face higher regulatory barriers and fewer opportunities for commercialisation. This dynamic must change if Europe wants to move from an AI regulator to a global leader.
To seize this opportunity, Europe must focus on five strategic pillars:
Simplifying research funding – AI researchers need access to funding without excessive bureaucracy. The ERC and national funding bodies should streamline application processes, ensuring that research grants are competitive with those in the US and Canada. Additionally, funding agencies should increase success rates for AI projects, ensuring that brilliant ideas are not lost in administrative red tape.
Competitive compensation for AI talent – If Europe wants to attract and retain top AI researchers, it must offer salaries on par with those in the US and Switzerland. Many American AI researchers earn over $150,000 while European salaries are often half that amount. Governments and private institutions must work together to close this gap by increasing salaries, offering long-term contracts and ensuring that AI research positions come with strong incentives.
If Donald Trump’s policies disrupt the US research ecosystem, top scientists may look elsewhere for stability- Alexiei Dingli
Building a world-class AI infrastructure – Cutting-edge AI research requires immense computational power, yet, Europe lags in cloud computing and supercomputing investments. The EU must prioritise the creation of AI-specific research facilities, providing scientists with the necessary tools to conduct world-class experiments. Major initiatives like Horizon Europe should dedicate more resources to AI infrastructure, ensuring that researchers do not need to rely on American cloud services for large-scale AI training.
Strengthening academia-industry collaboration – AI research is deeply intertwined with industry in the US, mainly through partnerships with companies like Google, Meta and Microsoft. Europe must foster stronger connections between universities and businesses, making it easier for AI researchers to transition into the private sector without leaving the continent. New funding incentives should encourage joint projects between academia and startups, ensuring that European AI breakthroughs lead to commercial success.
Streamlining regulation without stifling innovation – Europe’s AI Act has set a global benchmark for responsible AI governance but it must avoid becoming an obstacle to AI leadership. If regulations are too restrictive, they could drive talent and companies elsewhere. The EU should refine its approach by ensuring regulations protect fundamental rights while allowing rapid innovation. A flexible, adaptive regulatory framework that supports AI research while preventing harmful applications will be key to Europe’s success.
Europe already has promising AI hubs that could serve as models for broader expansion. The UK, for example, is emerging as a leader in AI-driven scientific discovery, leveraging its strong university system and deep connections to the global AI ecosystem. France has taken bold steps to attract AI talent, launching initiatives like the ‘Scientific Visa’ to streamline immigration for researchers. Meanwhile, Germany’s Fraunhofer Institutes and Max Planck Society have shown how public research institutions can work effectively with industry to drive innovation. Expanding and replicating these success stories across Europe could help create a more unified and competitive AI ecosystem.
The geopolitical landscape is shifting, and Europe has a rare opportunity to redefine its role in AI. If the US research environment becomes less stable thanks to Trump, Europe could attract top AI talent, strengthen its industry partnerships and solidify its position as a global leader. But, to do this, it must move beyond its traditional role as a regulator and take bold steps toward AI innovation and commercialisation.
The choice is clear: Europe can continue focusing on oversight while relying on American AI giants, or it can invest in its future, ensuring that the next generation of AI breakthroughs happens on European soil. With the right policies, funding and vision, Europe can move from regulation to leadership in AI – and the time to act is now.
Alexiei Dingli is a professor of artificial intelligence.