Reflections on Power, Diplomacy, and Strategic Foresight

Europe’s Digital Sovereignty: Power Is Infrastructure
By José Parejo, Founding Partner, José Parejo & Associates

Empires are not built on constitutions. They are built on grids.

Europe speaks often of strategic autonomy. It invokes the language of sovereignty, resilience, and independence. Yet in the digital century, sovereignty is not declared in treaties, nor secured in parliamentary speeches. It is embedded in the hard physical layers of infrastructure: cables, chips, data centers, spectrum, and above all the electricity that sustains them. The question for Europe is not whether it can regulate technology. The question is whether it can power it.

The Illusion of Sovereignty as Rhetoric

Carl Schmitt once defined sovereignty as the power to decide on the state of exception. In digital affairs, sovereignty is the capacity to decide what happens when demand spikes, when grids overload, when foreign platforms dominate. It is not the ability to legislate ideals, but to command electrons, chips, and latency in moments of crisis.

Europe’s political rhetoric suggests progress. In practice, the continent operates with structural deficits. Stand-alone 5G coverage reaches just 40% of its population, compared with 91% in North America and 45% in Asia-Pacific. Europe has installed only 320 edge-cloud nodes, against its own target of 10,000 by 2030. Just eight operators have even launched commercial edge offers. Sovereignty cannot be claimed with PowerPoints. It must be built in steel, silicon, and substations.

Historical Parallels: The Infrastructures that Decide

Every century reveals its decisive infrastructure. In the nineteenth, it was railroads: Britain accelerated, Russia lagged, and the map of industrial power shifted accordingly. In the twentieth, it was electrification and oil pipelines: those who mastered grids and refineries commanded both industry and war. During the Cold War, it was nuclear weapons and satellites: the infrastructure of deterrence and communication that structured the bipolar order.

Europe today risks repeating its familiar pattern: strong in regulation, late in infrastructure. In railways, Britain outpaced the continent. In nuclear energy, France advanced while others hesitated. In digital sovereignty, Europe is again debating frameworks while others build at speed. History suggests that the side that builds faster, not the side that legislates better, sets the terms of the system.

The Structural Gap

The gaps are visible to anyone who looks closely.

• 5G SA Coverage: 40% in Europe vs. 91% in North America.

• Edge Nodes: 320 deployed vs. 10,000 required.

• Energy Demand: Data centers consuming 96 TWh in 2024, rising to 236 TWh by 2035 — a 150% increase.

• Local Grid Strain: Data centers already absorb 33–42% of electricity in Frankfurt, Amsterdam, and London; nearly 80% in Dublin.

I recall visiting Dublin in 2023. An energy planner showed me charts where household and industrial demand traced relatively smooth curves. Then he pointed to the spikes from server farms: steep, relentless, dominating the grid’s profile. “Every time a new campus goes live,” he said, “we must redesign the system around it.” Sovereignty, I realized, is not abstract. It is measured in megawatts.

The Global Triangle

The geometry of power is unforgiving.

• The United States is reindustrializing at scale. Through the CHIPS Act, the Inflation Reduction Act, and direct subsidies, it seeks to bring semiconductor fabs, battery plants, and AI compute capacity back onto its soil. It dominates finance, oceans, and security, and is determined not to surrender the digital backbone to others.

• China exports digital infrastructure as part of its Belt and Road: submarine cables, 5G networks, surveillance systems. It controls critical parts of the semiconductor value chain and operates hyperscale AI clusters fueled by state subsidies.

• India is emerging as an independent pole. It adds nearly 10 million workers annually while China loses five million. Apple already assembles a quarter of its iPhones there. Its digital state — Aadhaar identity, taxation, logistics — functions as a meta-infrastructure more coherent than many OECD economies.

Europe must navigate this triangle not as a neutral arbiter but as a dependent actor. It produces less than 10% of the world’s semiconductors, imports 95% of its chips, and depends heavily on foreign cloud providers. Strategic autonomy cannot exist when the arteries of computation are controlled elsewhere.

Ortega y Gasset: Circumstance and Destiny

José Ortega y Gasset once wrote: “Yo soy yo y mi circunstancia, y si no la salvo a ella no me salvo yo.” I am myself and my circumstance, and if I do not save it, I do not save myself. For Europe, circumstance is not abstract: it is the physical configuration of its grids, its nodes, its cables. To save itself, Europe must save its circumstance.

Ortega’s insight reveals the danger of Europe’s current trajectory. Innovation does exist on the continent. But innovation without control of circumstance is fragile. AI startups flourish, but they run on foreign chips and foreign clouds. Sovereignty requires mastery of circumstance — otherwise Europe remains itself, but in someone else’s system.

Hannah Arendt: Power and the Digital Public Realm

Hannah Arendt argued that power arises from people acting in concert within a shared space. In the twenty-first century, that shared space is increasingly digital. Social discourse, democratic deliberation, even protest and participation — all depend on platforms, bandwidth, and compute. If the infrastructures of the digital public realm are foreign-owned, then sovereignty is hollow. Europe must confront a question Arendt would recognize: can a polity retain its autonomy when the very space of its politics is rented?

The Policy Response

The European Commission has launched InvestAI, a €200 billion program to triple capacity within 5–7 years. It has also mobilized €288 million across nearly 2,000 digital initiatives. Ambition is real, but time is scarce. Where connecting a data center takes 7–10 years — sometimes 13 — ambition becomes irrelevant. Sovereignty is a race against lead times.

Implications for Corporations

For corporate leaders, these dynamics are not abstract.

• Energy: Power Purchase Agreements (PPAs) and guaranteed grid capacity are no longer sustainability issues. They are continuity risks. Firms must treat energy access as a strategic asset.

• Technology: Edge and SA networks are not optional. Without them, latency remains too high for industrial AI, logistics robotics, or real-time healthcare. Investing in sovereign edge capacity is equivalent to investing in ERP systems two decades ago: the foundation of competitiveness.

• Finance: Capital allocation must account for grid bottlenecks. Investments in congested hubs risk stranded assets.

• Artificial Intelligence: Compute itself has become a sovereign factor of production. Firms must assess where their AI workloads run, under which jurisdiction, and at what cost of energy and latency.

The boardroom is no longer a financial chamber. It is a navigation room for geopolitics.

Spain as a Strategic Hinge

Amid these constraints, Spain offers overlooked advantages. With lower grid congestion than northern hubs, abundant renewable generation, and geographic connectivity to Western Europe, North Africa, and Latin America, it could emerge as Europe’s hinge for digital flows. If sovereignty requires space to build, Spain may be the rare circumstance where Europe can expand without immediate constraint.

The Lesson of Adaptation

Ibn Khaldun, writing in the fourteenth century, warned that civilizations collapse not when conquered but when they fail to respond to their internal challenges. Europe’s challenge is stark. Its weakness is not innovation, but implementation. Not vision, but speed. Sovereignty will not be lost because of foreign imposition, but because of domestic incapacity to build what is required in time.

Closing: The Geometry of Digital Power

The geometry of power has changed. Economically, it is increasingly bipolar: Beijing and Delhi define the gravitational axis of demography and production. Strategically, it is triangular: Washington remains the guarantor of oceans, capital, and security. For Europe, the choice is not whether to participate, but how to survive within this unstable geometry.

History will not remember the number of AI startups founded in 2025. It will remember whether Europe built the grids, nodes, and energy capacity to sustain them. The economy of the future is not oil or gas. It is data. And sovereignty in that economy will belong not to those who innovate most, but to those who govern the infrastructure that innovation requires.

— José Parejo

Founding Partner, José Parejo & Associates

Sunday CEO Strategic Insights | August 31, 2025

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