Europe’s Silicon Valley? No thanks

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CAMBRIDGE, England — This city wears many crowns: the fastest growing in Britain, the world’s most intensive research cluster and the university with the highest number of tech founders.

It also has Britain’s second highest level of inequality and one of the lowest amounts of rainfall of any U.K. city.

The tension between those titles has come to a head in the government’s bid to turn Cambridge into “Europe’s Silicon Valley.” Housing Secretary Michael Gove wants to build more than 150,000 new homes there by 2040, more than doubling the city’s size and triple the number local planners had earmarked for the area.

“Nowhere is the future being shaped more decisively than in Cambridge,” Gove said in a speech in December. “Its global leadership in life sciences and tech is a huge national asset. But until now… its growth has been constrained.”

He envisaged a new quarter with “beautiful Neo-classical buildings, rich parkland, concert halls and museums.” A new development corporation would be established to deliver the vision “regardless of the shifting sands of Westminster,” Gove said.

But in the face of mass house-building and water shortages; the investors, city leaders, businesses and environmentalists POLITICO spoke to for this article were skeptical of the scale of the government’s ambitions for their city.

They say they have other ideas.

Growing in a drought

The biggest obstacle to the city’s growth plans is a shortage of water. 

Plans for 9,000 homes and 300,000 square meters of research space, including a new cancer hospital, are being held up after the Environment Agency raised fears about water scarcity. Meanwhile, the area’s local water utility, Cambridge Water, is having to rework its latest management plan to account for the government’s inflated target.

The city pumps its water from underground chalk aquifers, but its rivers and streams are drying up. Levels in the River Cam have been 10 centimeters below their 2013 average for the last four summers.

“There is absolutely no point talking to us about expansion… unless you can solve the water problem,” said Cambridge Science Park director Jane Hutchins.

The science park wants to build a new campus and Hutchins said “we need to be able to accommodate growth at pace and in a timely manner, but we are all very conscious that we can’t do it at the cost of the environment.”

The Conservative MP for South Cambridgeshire has expressed similar concerns.

Plans for 9,000 homes and 300,000 square meters of research space are being held up after the Environment Agency raised fears about water scarcity | Cambridge City Council

The government has put £3 million into a water scarcity group and hopes a new reservoir in the Fens will solve the problem. But that is at least ten years away. In the meantime it is looking to rainwater harvesting, reducing consumption and a new pipeline.

Gove said in December that “new steps to help manage demand for water in new developments” would come in the new year.

Investors, tech founders and university leaders told POLITICO the water supply problem can be overcome, but environmentalists see it as an existential threat.

Sitting in a rooftop restaurant above the Cam, Tony Eva, whose film Pure Clean Water examines the city’s water crisis, said: “How many times can you say we will solve the problems caused by growth with more growth?”

“The shortage of water is not a new feature, we have known [about it] for 60 to 70 years… These clever people have sat on their hands and now they are having to do something. In one sense it is too late.”

Grow your own way

Wendy Blythe, chair of the Federation of Cambridge Residents’ Associations, agreed.

She argues that Cambridge has had enough growth and the “goodies” should go to less affluent parts of the country. Critics of Gove’s plan point out that the minister in charge of “leveling up” is putting forward a policy that could do the opposite.

“Lots of things are happening to Cambridge to become a ‘Silicon Valley,’ and ordinary residents are paying for it,” Blythe said.

Grappling with these problems is Tabitha Goldstaub, a tech entrepreneur and executive director of Innovate Cambridge, a group set up by the university and investors to come up with a more sustainable innovation strategy.

“We’d like to be as successful [as Silicon Valley] but we don’t want to be as socially unequal,” she said.

Income inequality in Cambridge, measured as the gap between the poorest and richest residents, is the second highest in England and Wales, only behind Oxford, and it is widening.

But Goldstaub said the city had “woken up” to the challenge and that supporting local people was a key pillar of an innovation strategy which it unveiled in October.

Income inequality in Cambridge is the second highest in England and Wales | Cambridge City Council

Innovate Cambridge hopes to get the wider population behind that strategy by showing the benefits of living close to so much research, such as better cancer survival rates at Addenbrooke’s Hospital.

It has also set up a community fund for founders to pledge a percentage of money they make from selling their startups in the future. 

Pro-vice-chancellor for enterprise at Cambridge University, Andy Neely, said: “We need to make it clear to people why the research and cluster is improving the quality of their lives.”

The Department for Levelling Up, Housing and Communities says investing in Cambridge will reduce regional inequality. A spokesperson for the department told POLITICO: “We must be ambitious and expand the city and we will only do that through sustainable development.”

We’ll think, you’ll make

On the three-minute walk from the city’s main railway station to the office of VC firm Cambridge Innovation Capital (CIC), you pass offices for Apple, Microsoft and Amazon. But the city is more proud of the startups which have spun out of its university.

New arrival Gerard Grech, who has joined the university to lead a program supporting tech founders, said he was astounded by the innovation in the city. “In my first week here I met someone who had sold businesses to Google, to Apple and to Microsoft. I could not believe it,” he said.

The area around the station is also where Goldstaub hopes to build a new innovation center, where she sees VCs, researchers and startups mingling and coming up with new ideas.

But despite its concentration of creativity, some say the government’s “Silicon Valley” ambitions should be spread across larger parts of the country, rather than focusing on Cambridge.

The city has recently signed a partnership with Manchester to pitch their respective tech hubs as a single cluster to investors, and Goldstaub says such deals should be “the exemplar” going forward.

Semiconductor firm Pragmatic provides a model for this type of development. The company is aiming to become the U.K.’s biggest semiconductor manufacturer, and its founders moved from Manchester to Cambridge for its talent. It is still headquartered in Cambridge, but does most of its manufacturing in Sedgefield, north-east England.

CIC was an early investor in Pragmatic, which completed a £500 million funding round this month.

Andrew Williamson, managing partner at CIC, said this was an example of “a hub and spoke” model which Cambridge excels in.

A report on the university’s economic impact suggests it is generating £30 billion of economic value in the U.K. and supporting 86,000 jobs | Cambridge City Council

“Where the model differs from Silicon Valley is Cambridge is 150,000 people… so we are tiny. What we can do here is fundamental research and the first few steps of the commercialization of that research, but we’re clearly not going to do manufacturing at scale.”

Sai Shivareddy has learned that over the last two years. He co-founded Nyobolt, which designs and manufactures super-fast chargers and batteries for EVs.

The company spun-out from the university and was valued at £300 million last year, but it has struggled to find suitable manufacturing sites in Cambridgeshire. Shivareddy said he is now looking to manufacture in north England or Scotland, as well as Asia.

Giving out the goodies

A report on the university’s economic impact suggests it is already helping the leveling up agenda by generating £30 billion of economic value in the U.K. and supporting 86,000 jobs, more than 30,000 of which are outside the east of England.

“The way the U.K. will compete with Silicon Valley is to think in large clusters,” Neely said, pointing to the Oxford-Cambridge Arc and the Manchester partnership. 

“Cambridge can play a really powerful role providing the boosters but it can’t just be Cambridge.”

Rebecca Simmons, chief operations office at Cambridge quantum firm Riverlane, agreed. “I don’t think Cambridge can do it all,” she said. “If we want to get bigger, we have to do it across the country. Particularly in the quantum world — Oxford, Bristol, Sheffield, Manchester, Liverpool, they’ve all got good hubs mostly based around universities.”

“It’s important that we step up and connect the dots between the various cities in this country,” said Grech, who led startup incubator Tech Nation for a decade. “For me, Silicon Valley is a mindset. I think we should basically adopt its mindset and apply it everywhere.”



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PTFE ban: The hidden consumer costs and employment losses

As part of the EU’s landmark Green Deal package, the 2020 Chemicals Strategy for Sustainability called for an ambitious concept: achieving a toxic-free environment by 2030. A central pillar of this ambition is the proposal for a universal PFAS — per- and polyfluoroalkyl substances — restriction, addressing contamination and emissions from the controversial family of substances sometimes known as ‘forever chemicals’.

Action to tackle this family of chemicals is overdue, and European industry is ready to do its part. As the president of the Federation of the European Cookware, Cutlery and Houseware Industries (FEC), I welcome the initiative. FEC members pride themselves on providing safe and durable products to consumers, and were early to phase out these problematic substances. Despite this, the current restriction proposal still needs substantial changes to achieve its goals of protecting human health and the environment while balancing socioeconomic effects, impacts on carbon emissions and circularity.

While many elements of the proposed restriction are well justified, some risk damaging the EU industry’s competitiveness and hindering progress on the green and digital transitions, all while banning substances which are known to be safe. The European authorities need to understand the impacts of the proposal more thoroughly before making decisions which will harm consumers and the European workforce, and perhaps even result in worse environmental outcomes.

The current restriction proposal still needs substantial changes to achieve its goals of protecting human health and the environment while balancing socioeconomic effects.

As the most complex and wide-ranging chemical restriction in EU history, it is essential that the institutions take no shortcuts, and take the time to clearly understand the unintended environmental and socioeconomic impacts on every sector.

The PFAS restriction proposal is broad, covering over 10,000 substances, many of which were not considered part of the PFAS family in the past. In an effort to catch all possible problematic chemicals that could be used in the future, the member countries which proposed the restriction have cast a net so wide that it also includes substances which pose no risk. Even the OECD, the source of the broad scope used by the authorities, concedes that its definition is not meant to be used to define the list of chemicals to be regulated.

In addition to the legacy PFAS substances, which have serious concerns for human health and the environment, the proposal also includes fluoropolymers in its scope, which are not mobile in the environment, not toxic and not bioaccumulative — a stark contrast to the controversial PFAS substances at the center of contamination scandals across Europe and around the globe.

As the most complex and wide-ranging chemical restriction in EU history, it is essential that the institutions take no shortcuts.

Fluoropolymers are well studied, with ample scientific evidence demonstrating their safety, and unlike legacy PFAS, technologies exist to control and eliminate any emissions of substances of concern from manufacturing to disposal.

Fluoropolymers are not only safe, their safety is a primary reason for their widespread use. They provide critical functionality in sensitive applications like medical devices, semiconductors and renewable energy technology. They are also used in products we all use in our day-to-day lives, from non-stick cookware to electrical appliances to cars. While in some cases there are alternatives to fluoropolymers, these replacements are often inferior, more expensive, or have even more environmental impact in the long run. Where alternatives aren’t yet identified, companies will need to spend large sums to identify replacements.

In the cookware industry, for example, fluoropolymers provide durable, safe and high-performing non-stick coatings for pots, pans and cooking appliances used by billions of people across Europe and around the globe. Decades of research and development show that not only are these products safe, but their coatings provide the most high-performing, durable and cost-effective solution. Continued research and development of these products is one of the reasons that the European cookware industry is considered a world leader.

Fluoropolymers are well studied, with ample scientific evidence demonstrating their safety and … technologies exist to control and eliminate any emissions of substances of concern from manufacturing to disposal.

Given the critical role that fluoropolymers play in so many products and technologies, forcing a search for inferior or even nonexistent alternatives will harm the EU’s competitiveness and strategic autonomy. In the cookware industry alone, the restriction could cost up to 14,800 jobs in Europe, reduce the economic contribution of the sector to the GDP by up to €500 million, and result in a major shift of production from Europe to Asia, where the products would be made under much less stringent environmental rules. Consumers will also suffer, with new alternatives costing more and being less durable, requiring more frequent replacement and therefore resulting in a larger environmental impact.

Beyond this, companies that enable the green transition, deliver life-saving medical treatments, and ensure our technology is efficient and powerful will all be required to engage in expensive and possibly fruitless efforts to replace fluoropolymers with new substances. What would be the benefit of these costs and unintended consequences, when fluoropolymers are already known to be safe across their whole lifecycle?

Given the critical role that fluoropolymers play in so many products and technologies, forcing a search for inferior or even nonexistent alternatives will harm the EU’s competitiveness and strategic autonomy.

The scale of the PFAS restriction is unprecedented, but so are the possible unintended consequences. Industry has contributed comprehensive evidence to help fill in the blanks left by the initial proposal, it is now up to the institutions to take this evidence into account. With such a far-reaching initiative, it is essential that the EU institutions and the member countries thoroughly consider the impacts and ensure the final restriction is proportional, preserves European competitiveness and does not undermine the broader strategic objectives set for the coming years.

Founded in 1952, FEC, the Federation of the European Cookware, Cutlery and Housewares Industries, represents a strong network of 40 international companies, major national associations and key suppliers spread over Europe, including in Belgium, Croatia, France, Germany, Italy, Spain, Switzerland and the Netherlands. Our mission is to promote cooperation between members, and to provide expertise and support on economic and technical topics.



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Keeping the digital ecosystem strong

Wassim Chourbaji, Senior Vice President, Government Affairs & Public Policy EMEA at Qualcomm

Competitive markets and strong partnerships have always encouraged companies to innovate. Policies promoting such an environment allow for more inventions and creations within national, regional and international markets.

The EU leads the world in understanding the broad, interlinked forces driving technology innovation in the digital sector. The approval and enforcement of the Digital Markets Act (DMA) exemplify this leadership and are critical to preserving an open digital ecosystem.

The development of communications network infrastructure is another important area that can spur innovation. The EU has recognized the need to incentivize investment in digital infrastructure through ‘virtuous circles’ to bring reliable and secure connectivity. The physical network sits at the core of the digital ecosystem, but is also at the heart of our economies and societies.

Moreover, the EU has focused on the strategic value of semiconductors as engines of the digital transition that foster Europe’s competitiveness. The EU Chips Act has highlighted the need for a geo-diversified production and coordinated strategy amongst countries to balance global dynamics, security needs and supply priorities.

Fostering talent

In addition to the regulatory environment, it is important to nurture the human ingenuity that drives technology by strengthening partnerships that bring people and companies together.

Successful partnerships that lead to cutting-edge innovations are built on the individual human connections that spark new ideas. Talent is the most valuable resource for today’s knowledge-based economy. Promoting participation in science, technology, engineering, and mathematics (STEM) disciplines to create the skilled workforce necessary for the global digital economy is essential. Qualcomm collaborates with community stakeholders on several programs across Europe that reach and inspire students from all backgrounds.

Furthermore, local innovation hubs have a paramount role in attracting, retaining and developing talent. With this in mind, Qualcomm established a 5G/6G R&D centre in Lannion, France, and an Artificial Intelligence (AI) R&D lab in Amsterdam, the Netherlands, doing fundamental research to fuel the connected intelligent edge with innovation.

Successful partnerships that lead to cutting-edge innovations are built on the individual human connections that spark new ideas.

Transforming through partnerships

Partnerships to develop and apply advanced technologies are decisive in unlocking access to future innovations and use cases, such as leveraging the metaverse for industrial and learning applications. Europe is an epicenter of technology R&D leadership — and our labs in Austria, Finland, France, Germany, Ireland, the Netherlands and Spain are integral to our ability to engage in such partnerships.

From operators to automotive and industrial players, Qualcomm’s partnerships with European companies are good examples of how shared digital value can be created across an expanding range of verticals – by combining complementary technologies and expertise.

The automotive sector is a prime example. Digital transformation is a priority for automakers as vehicles become connected computers on wheels. Qualcomm’s digital chassis high-performance solutions empower automakers to add a full suite of technology to create software-defined intelligent vehicles that are highly customizable and upgradeable. This flexibility enables the adoption of a wider array of powerful automotive platforms, while allowing automakers to keep the relation with their customers and shape the in-vehicle digital experience.

Europe is an epicenter of technology R&D leadership — and our labs in Austria, Finland, France, Germany, Ireland, the Netherlands and Spain are integral to our ability to engage in partnerships.

Protecting innovative ideas

As companies like Qualcomm drive cycles of innovation and creativity, it is important to have a strong intellectual property regime that protects the ideas that emerge. One key area that relies on such protections are communications standards like 5G. Standards are the foundation of the digital ecosystem. They also are crucial to competition, helping new entrants compete with existing players.

Today’s 5G standard is a direct descendant of a European initiative back in the 1980s that pushed for a single mobile standard to enable the single market. Europe’s strong patent rights were critical to its early leadership in mobile standards. These rights have given innovative companies the necessary incentives to invest in research and development and to contribute their intellectual property (IP) to the standards. Without these incentives, innovation within the ecosystem would stagnate.

This year, the European Commission will tackle files that will impact standards development – including the IP that fuels the necessary ongoing innovation. It is our hope that their importance to the digital ecosystem continues to be championed.

Qualcomm is a partner to Europe in achieving its digital transformation through talent development, transformative partnerships, and continuous innovation.

Building a future vision

All stakeholders have a role to play in incentivizing a vibrant digital ecosystem. By keeping a holistic view of all aspects that support a healthy digital ecosystem, Europe is bound for success.

This success can be further bolstered by the joint EU-US continuous dialogue. We hope the Trade and Technology Council (TTC) will be a vehicle for the EU-US cooperation to address new and emerging global tech and trade challenges. The TTC could serve as a focal point to increase trust and understanding to enable innovation, encourage investments and foster competition. Global leadership can only be achieved through policy cooperation and market-led approaches.

Qualcomm is a partner to Europe in achieving its digital transformation through talent development, transformative partnerships, and continuous innovation. Our connected future depends on it.



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A plan for competitive, green and resilient industries

We, Renew Europe, want our Union to fulfil its promise of prosperity and opportunities for our fellow Europeans. We have championed initiatives to make our continent freer, fairer and greener, but much more remains to be done.

We are convinced that Europe has what it takes to become the global industrial leader, especially in green and digital technologies. Yet it is faced with higher energy prices and lower levels of investment, which creates a double risk of internal and external fragmentation.

The Russian aggression against Ukraine has shown us that our European way of life cannot be taken for granted. While we stand unwaveringly at the side of our Ukrainian friends and commit to the rebuilding of their homeland, we also need to protect our freedom and prosperity.

That is why Europe needs an urgent and ambitious plan for a competitive, productive and innovative industry ‘made in Europe’. Our proposals below would translate into many more jobs, a faster green transition and increased geopolitical influence.

We must improve the conditions for companies, big and small, to innovate, to grow and to thrive globally.

1. Reforms to kick start the European economy: A European Clean Tech, Competitiveness and Innovation Act

While the EU can be proud of its single market, we must improve the conditions for companies, big and small, to innovate, to grow and to thrive globally.

  • In addition to the acceleration of the deployment of sustainable energy, we call on the Commission to propose a European Clean Tech, Competitiveness and Innovation Act, which would:
  • While the EU can be proud of its single market, we must improve the conditions for companies, big and small, to innovate, to grow and to thrive globally.
  • In addition to the acceleration of the deployment of sustainable energy, we call on the Commission to propose a European Clean Tech, Competitiveness and Innovation Act, which would:
  • Cut red tape and administrative burden, focusing on delivering solutions to our companies, particularly for SMEs and startups.
  • Adapt state aid rules for companies producing clean technologies and energies.
  • Introduce fast-track permitting for clean and renewable energies and for industrial projects of general European interest.
  • Streamline the process for important Projects of Common European Interest, with adequate administrative resources.
  • Guarantee EU-wide access to affordable energy for our industries.
  • Strengthen the existing instruments for a just transition of carbon-intensive industries, as they are key to fighting climate change.
  • Facilitate private financing by completing the Capital Markets Union to allow our SMEs and startups to scale up.
  • Set the right conditions to increase Europe’s global share of research and development spending and reach our own target at 3 percent of our GDP.
  • Build up the European Innovation Council to develop breakthrough technologies.
  • Deliver a highly skilled workforce for our industry.
  • Deepen the single market by fully enforcing existing legislation and further harmonization of standards in the EU as well as with third countries.

We need to reduce more rapidly our economic dependencies from third countries, which make our companies and our economies vulnerable.

2. Investments supporting our industry to thrive: A European Sovereignty Fund and Reform Act

While the EU addresses, with unity, all the consequences of the war in Ukraine, we need to reduce more rapidly our economic dependencies from third countries, which make our companies and our economies vulnerable.

In addition to the new framework for raw materials, we call on the Commission to:

  • Create a European Sovereignty Fund, by revising the MFF and mobilizing private investments, to increase European strategic investments across the Union, such as the production on our soil of critical inputs, technologies and goods, which are key to the green and digital transitions.
  • Carry out a sovereignty test to screen European legislation and funds, both existing and upcoming, to demonstrate that they neither harm the EU’s capacity to act autonomously, nor create new dependencies.
  • Modernize the Stability and Growth Pact to incentivize structural reforms and national investments with real added value for our open strategic autonomy, in areas like infrastructure, resources and technologies.

While the EU has to resist protectionist measures, we will always want to promote an open economy with fair competition.

3. Initiatives creating a global level playing field:

A New Generation of Partnerships in the World Act

While the EU has to resist protectionist measures, we will always want to promote an open economy with fair competition.

  • In addition to all the existing reforms made during this mandate, notably on public procurement and foreign subsidies, we call on the Commission to:
  • Make full use of the EU’s economic and political power regarding current trade partners to ensure we get the most for our industry exports and imports, while promoting our values and standards, not least human rights and the Green Deal.
  • Promote new economic partnerships with democratic countries so we can face climate change and all the consequences of the Russian aggression together.
  • Ensure the diversification of supply chains to Europe, particularly regarding critical technologies and raw materials, based on a detailed assessment of current dependencies and alternative sources.
  • Use all our trade policy instruments to promote our prosperity and preserve the single market from distortions from third countries.
  • Take recourse to dispute settlement mechanisms available at WTO level whenever necessary to promote rules-based trade.
  • Adopt a plan to increase our continent’s attractiveness for business projects.
  • Create a truly European screening of the most sensitive foreign investments.
  • We, Renew Europe, believe that taken together these initiatives will foster the development of a competitive and innovative European industry fit for the 21st century. It will pave the way for a better future for Europeans that is more prosperous and more sustainable.



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