The Geopolitics and Economics of AI: Why the “AI Race” Is the Wrong Mental Model

2026-07-19 · Industry Analysis

This presentation challenges the popular notion of a global “AI race,” arguing that artificial intelligence should instead be viewed as critical national infrastructure similar to energy or electricity. Given AI’s potential to capture a significant share of global economic activity, no single provider or nation can realistically dominate the market without creating unsustainable economic and geopolitical imbalances. Instead, AI will evolve into a fragmented global ecosystem where countries pursue sovereign AI capabilities while specialising in areas aligned with their industrial strengths. For Europe, the opportunity lies not in replicating frontier model providers but in integrating AI into manufacturing, scientific research, public services, and strategic industries.