Impulses: Gaining strength through strategic investments
Geopolitical tensions have established themselves as a permanent side effect. In a changing world order, states are increasingly questioning existing cross-border dependencies – especially in the areas of supply chains, national security, energy supply and digital infrastructure. Securing supply chains within the framework of multilateral structures is currently shaping both political priorities and investment decisions by state and private sector actors. European companies can also benefit from this trend.
World powers with a focus on national interests
Under the current U.S. administration, an "America First"-oriented industrial policy is being consistently pursued. Even close allies face trade tariffs on exports to the United States, despite long-standing political partnerships, while NATO partners can no longer fully rely on military support from the United States.
The emerging world power China is also pursuing a strategy of targeted national strengthening in key industries such as electric vehicles, solar modules and artificial intelligence. The aim is to further expand the global dominance of Chinese supply chains and at the same time reduce its own vulnerability to external dependencies.
Europe is strategically vulnerable
Europe is in danger of being crushed in the field of tension between global power competition and must therefore regain its strategic ability to act. Although the continent remains an economic heavyweight, three key weaknesses are becoming increasingly apparent: a lack of military autonomy, insufficiently independent energy supplies and limited access to critical digital infrastructures.
Russia's war of aggression against Ukraine, which has been ongoing since 2022, the realignment of US tariff policy under President Trump, and the recent tensions in the Middle East have relentlessly exposed Europe's structural weaknesses and international dependencies – especially in the field of energy supply. Although Europe has reduced its dependence on Russian gas, at the same time its dependence on American liquefied natural gas (LNG) has increased. Despite progress in the expansion of renewable energies, the continent remains vulnerable to external supply disruptions.
Russia's war of aggression has also revealed serious shortcomings in terms of security policy: Europe was insufficiently prepared for a military conflict on its own soil. For decades, the assumption prevailed that large-scale wars were a thing of the past, while responsibility for security was effectively outsourced to the United States. As a result, not only defense budgets shrank, but also military capabilities and ammunition stocks.
A third area is less visible, but just as crucial: digital sovereignty. Today, modern defense systems, financial markets, and government administrative processes are hardly functional without cloud technologies. As digitalization progresses, the dependence on high-performance cloud infrastructure is growing continuously. Nevertheless, central areas such as cloud computing, data storage and artificial intelligence are dominated by a few US technology companies. Hyperscalers such as Amazon, Microsoft and Google together control around 70 percent of the European cloud market.[1]
Europe therefore remains dependent on other countries in those areas that are becoming increasingly relevant for economic stability and security.
The European reaction as an opportunity for investors
Europe has decided to take on its own defence again: since the Russian invasion of Ukraine, military spending has increased significantly, and in 2025 NATO allies committed to spending 5% of their GDP on defence in the future.
These higher budgets will initially flow into the reconstruction of sharply shrunken stocks of ammunition, missiles and air defense systems. Companies in these areas are likely to benefit from sustained demand in the long term. Manufacturers of military aircraft, helicopters and modern electronics also play a central role in Europe's defence capability.
At the same time, the focus of spending is shifting towards capabilities that reflect the changes in modern warfare. The increased use of drones is driving the demand for unmanned systems and their defense. In addition, modern military operations are increasingly dependent on secure communication, sensor technology, electronics and cyber capabilities. Companies in the areas of command and control systems, communications and electronic warfare are therefore likely to benefit particularly from increased investments.
“It is not the renunciation of globalisation, but the conscious handling of dependencies that defines Europe's future – supported by investments in key industries.”
Steffen Kunkel, Chief Investment Analyst
Energy independence as a strategic priority
The expansion of renewable energy and additional storage capacity is crucial for energy security, as domestically generated electricity makes the EU more resilient to external shocks. Accordingly, the share of renewable energies in total consumption is to increase to 45% by 2030 – from currently around 25%.[2] Nuclear energy also remains part of the debate, especially as a stable source ofbaseload supply.
However, the investment needs go far beyond generation and storage. Europe's energy infrastructure has not yet been able to keep pace with growing demand, with electricity grids in particular being a key bottleneck. Companies in the fields of grid technology, energy management, system automation and transmission and interconnections should therefore benefit significantly from the expansion and modernisation of Europe's electricity infrastructure.
Reduce digital dependencies, strengthen infrastructure
A similar pattern can be seen in the technology industry as in the energy sector: Europe has high-performing companies – such as SAP in the field of enterprise software and cloud services or Mistral in the field of artificial intelligence. But they do not operate on the scale of US hyperscalers, whobenefit from capital strength, global reach, extensive data access and strong network effects. Europe's strategy should therefore be aimed less at building its own tech giants along the lines of this model, but rather at limiting the risks associated with this dependency.
At the same time, providers of cloud computing and AI also rely on physical infrastructure, which must be built and operated in Europe. As usage grows, so does the need for data centers, power supply, grid connections, cooling systems, and automation and network technology. The expansion of cloud capacities therefore requires a correspondingly powerful infrastructure – regardless of whether it is used by European providers or US hyperscalers. This creates substantial investment opportunities for European companies in the areas of data centres, energy supply, cooling, connectivity and digital infrastructure.
Conclusion: Investments on the way to greater resilience
The geopolitical upheavals make a reassessment of strategic dependencies inevitable. In order to finance the necessary change, both public and private investments are needed. Europe is an example of fundamental strategic decisions that are increasingly shaping political action worldwide.
A complete decoupling from global supply chains is neither realistic nor desirable – a certain degree of dependence will remain. But as defence, energy and technology increasingly determine economic stability, Europe is working hard to reduce its vulnerability in these key areas. This change is leading to increased investment in infrastructure and industrial capacity to increase resilience and become more self-reliant in the long term.
