Focus, Synergy and Systems: Three Strategic Principles to Harness Europe’s Quantum Industry

CSDS POLICY BRIEF • 16/2026

By Riccardo Bosticco

7.7.2026

Key issues

• The quantum technology industry is taking shape amid intensifying geopolitical rivalries. The challenge is to balance technological advancements and economic security.
• The United States, China and the European Union are competing through different models. Brussels lacks the strategic principles to guide its quantum policy.
• Three strategic principles should guide Europe’s quantum industrial policy: focus, synergy and systems. Quantum technologies require prioritisation, complementarity and interoperability.

Introduction

In the 1980s, physicist Richard Feynman foresaw that the most powerful computer would exploit quantum physics. Today, that vision is becoming reality: estimates indicate the next three to five years will prove decisive in determining the emerging quantum industry’s winners and losers. In 2025, quantum technology companies generated roughly US$1 billion in revenues. Experts project the value to more than quadruple by 2028, to reach a US$2.7 trillion economic turnover by 2035. Hence, entrepreneurs and governments are hurrying to secure the materials, components, machines and engineers to scale the technology and its applications. Concurrently, the industrial challenge is converging with the geopolitical one. Quantum technologies promise disruptive advantages across fundamental sciences as well as national security-sensitive domains like encryption and sensing. The unprecedented power of quantum computation makes it impossible for economic and political leaders to ignore it.

Advancements in quantum computing are occurring against a backdrop of fast-paced technological change, concentrated mostly around artificial intelligence (AI) and related technologies, and geopolitical turmoil, both of which are transforming economic flows and structures into instruments and arenas of warfare. In this context, states are faced with the double challenge of sustaining technological advancements profitably and hardening their grip over the technologies’ material foundations – either to prevent chokepoints from ending up under foreign control, or to use them offensively. The United States (US), China and the European Union (EU) are all adopting different models to address this dual challenge. The US makes no secret of its objective to establish lasting quantum supremacy: it hosts one of the most innovative technological ecosystems globally; it can leverage the scale of “Big Tech” platforms to speed up technological access while locking in users through network effects; and it possesses an economic security apparatus which knows how to use policy to prevent technologies and expertise from spilling over to its rivals. China, in contrast, is growing an increasingly competitive scientific and technological ecosystem; it boasts unparalleled state power; and, similarly to its approach to AI, it aims for self-sufficiency in quantum computing, which Beijing’s 15^th Five-Year Plan designates as the most promising technology for future growth.

The EU is no less ambitious. Brussels can count on a solid scientific base; it possesses significant advantages across different quantum hardware platforms, as well as market leadership in key quantum enablers like cryogenics. However, it also faces significant challenges compared to Washington and Beijing. First, the current structure of the EU polity is an impediment to reaching the same scale. Politically, it makes it hard to define clear strategic objectives; economically, it prevents firms from receiving comparable levels of financial support. Second, the same structure and the division of competencies among supranational and national bodies clash with today’s overhaul of the boundaries between economic and national security. Fulfilling the EU’s quantum ambitions, therefore, requires striking a balance between setting the right incentives for domestic firms to scale without turning to foreign capital markets and securing control over bottlenecks through the emerging quantum supply.

The EU’s quantum policy, this CSDS Policy Brief argues, should be centred around clear strategic principles designed to strike that balance. This policy brief advances three:

– focus: to prioritise the stack layers where Europe should compete;

– synergy: to create the incentives that favour the commercialisation of quantum; and

– systems: to make the EU’s quantum industry operate in unison.

Strategic principles should guide any policy: they must be sharp enough to set a direction and flexible enough to accommodate the unforeseeable. They must be sensitive to how the technology concerned works and how markets are evolving. Accordingly, this policy brief outlines the basic characteristics of quantum technologies that lie at the heart of industrialisation challenges. Next, it reviews the main characteristics of the American, Chinese and European approaches to quantum technologies. Then, it expands on the EU’s position in the emerging quantum ecosystem. The final section develops the three strategic principles of focus, synergy and systems.

Why quantum industrialisation is hard

Quantum technologies comprise three broad families of applications: quantum computing, quantum communication and quantum sensing. Different in purpose and maturity, they all rely on the same underlying principles of quantum mechanics. The fundamental unit of quantum information is the quantum bit, or qubit. Unlike a classical bit, which can take a value of either zero or one, a qubit can exist in a superposition of both states (0 and 1) simultaneously. Multiple qubits can also become entangled, meaning that their states are correlated and end up being described jointly rather than independently. Together, superposition and entanglement are two properties of quantum mechanics that allow systems to represent and manipulate information in fundamentally different and more powerful ways than classical computers. These same properties, however, make quantum systems fragile. Interactions with surrounding environments can disrupt quantum states and destroy the information they contain. Maintaining useful quantum states therefore requires sophisticated error-correction techniques as well as highly specialised hardware capable of shielding qubits from external disturbances. Thus, the third property of quantum systems is coherence: electron waves must move in unison for quantum systems to work properly.

To achieve coherent or fault-tolerant quantum systems, it is necessary to understand the difference between physical and logical qubits. Physical qubits are the hardware devices that store information in a quantum computer. They are the equivalent of a transistor in a classical computer (the tiny semiconductor devices that control the flow of electricity). As the next section shows, quantum technologies have not yet converged on a single hardware platform. Logical qubits, instead, are the error-corrected qubits that emerge from combining many physical qubits through quantum error correction. Logical qubits are mathematical abstractions but constitute the most important metric for assessing progress in quantum computing. The companies that demonstrate fault-tolerant quantum systems are those that will transition fastest from research to actual products. The endgame for companies at the forefront of competition is to scale error-corrected, fault-tolerant quantum systems.

Processing and manipulating qubits requires specific hardware platforms. However, multiple platforms exist and compete simultaneously: superconducting circuits, trapped ions, neutral atoms, photonic and spin qubits, among others. Some experts predict that the industry will eventually consolidate around just one, as occurred with Intel’s x86 in microchips decades ago. Others, instead, foresee that multiple platforms will coexist, just like different processing units exist in classical and AI computing (such as CPUs, GPUs, etc.). This uncertainty, however, leaves quantum policymakers and investors with a choice: concentrate resources on promising bets, risking high losses if wrong or spread support more evenly, risking underinvestment in the most likely winners. Nevertheless, focusing on such questions risks downplaying the importance of other enabling technologies that will allow quantum to scale. These include the materials needed to produce and operate quantum technologies, cryogenics, control electronics, software applications and networking. Markets in these enabling technologies are evolving, with quantum industry frontrunners maintaining varied dependencies across the forming quantum stack. The next section cursorily describes the American, Chinese and European approaches to quantum technologies.

Three quantum models

As of 2024, EU public investment in quantum technologies trailed only China’s (US$ 15 billion versus a combined EU figure of roughly US$ 10 billion, against US$ 5 billion in the US), while Chinese private investment roughly doubled the EU’s, and American private investment roughly quadrupled it. These figures reflect the three different industrial approaches to quantum adopted by the US, China and the EU, briefly described below.

The US thinks of technology as part of an overall strategy to affirm America’s technological superiority and make other nations rely upon it. In the US, it is mostly Big Tech like IBM, Google and Microsoft, which are driving quantum industrialisation. Nonetheless, the US also enjoys high-performing venture capital markets, which allow startups to find financial and operational room to scale. Simultaneously, the government contributes to coordinating efforts and public support for fundamental science through initiatives such as DARPA’s Quantum Benchmarking Initiative, which helps evaluate whether competing hardware approaches can reach utility-scale operation by 2033, and the use of export controls aimed at denying rivals access to critical technologies. In late 2024, the Department of Commerce introduced export restrictions targeting quantum computing, imposing licensing requirements on quantum computers and the transfer of related components, materials, software and specialised knowledge. Nevertheless, the American quantum industrial base rests on relatively weak foundations, with many of the materials, components and enabling technologies needed to operate quantum computers imported from abroad. The US concentrates most of its resources outside enabling materials and technologies: less than 12% of US quantum R&D between FY2019 and FY2024 went to enabling technologies such as lasers, cryogenics and fabrication infrastructure. Consequently, the US’ champions currently find themselves atop a thin base of suppliers dispersed internationally.

China is motivated to counter the US’s technological dominance, focusing on achieving national self-sufficiency through a significant state-centred industrialisation push in quantum. The Chinese model allows domestic organisations to reach substantial scale in a relatively short time, primarily through state backing. Most recently, China’s 15^th Five-Year Plan (2026–2030) has strengthened the logic of industrialisation and commercialisation, designating quantum as the first of seven “future industries” expected to drive future growth. China is already deploying subsidies, leveraging dynamic technology parks, launching technological competitions and using state-owned enterprises to create solid domestic innovation and production systems. China’s absorptive capacity is a challenge to Western competitors: by stimulating domestic consumption of domestically produced materials, components and machinery, foreign suppliers are finding themselves needing to diversify their customer base. Moreover, by nurturing domestic suppliers through state backing, competition for Western suppliers is becoming much tougher. China’s quantum strategy is rooted in self-sufficiency. This is why, in contrast to the US, China is focusing more on strengthening its own supplier base across all layers of the emerging quantum stack. China’s greatest weaknesses lie further up the stack, for example in error correction, where China still trails the technical frontier reached by leading European and American firms. Moreover, it can be argued that China’s self-sufficiency push on the one hand and the increasing competitiveness of its industry on the other are making it significantly less attractive for other countries to keep doing business in and with China. Beijing’s state-led practices might lead to impressive economic and technological development but also increase the incentives for competitors to align in opposition to it.

The EU’s approach to quantum lacks the strategic ambition of either the US or China. The EU’s model combines world-class science and numerous small champions with fragmented capital markets and limited scale-up financing. Most significantly, it lacks an overarching strategic framework. Quantum technologies fall under the EU’s efforts to build strategic autonomy or technological sovereignty; however, these terms have been criticised for their conceptual elusiveness and the lack of clarity regarding their operationalisation. Moreover, European industries express doubts about whether the EU can realistically achieve technological competitiveness and security by itself. The discussion about what strategic principles must inform the EU’s action is still open. The EU’s 2025 Quantum Europe Strategy indicates five priority areas for the forthcoming Quantum Act: research and innovation; quantum infrastructure; ecosystems; space and dual-use technology; and skills. These are all areas where the EU should indeed focus its attention; however, the list will not deliver unless policymakers are clear about what they want to obtain through new regulations, instruments and financing. EU quantum technology companies across the emerging stack already cover more layers of the stack simultaneously than either the US or China. Moreover, the EU’s end-user industries are recognised as the readiest to integrate quantum technologies. These are advantages with potentially consequential effects on the future of the EU’s quantum industry. Before turning to the strategic principles to inform quantum policy, the next section sheds light on some of the EU’s strengths and weaknesses across the quantum stack.

The EU’s strengths and weaknesses across the quantum stack

EU firms hold competitive or leading positions across several layers of the quantum stack. Finland’s IQM leads globally in superconducting qubits, with 30 full-stack systems delivered worldwide; its Star and Crystal architectures achieve 99.9% two-qubit gate fidelity, with its Garnet processor already accessible via Amazon Braket. The Dutch firm QuantWare offers the broadest commercial product range in the sector, from 5-qubit Soprano through 64-qubit Tenor, serving over 50 customers across 20 countries. France hosts Pasqal, the global leader in neutral-atom computing, and Quandela, Europe’s leading photonic quantum computing firm. Beyond these platforms, Finland’s Bluefors leads the world in cryogenics, needed to cool quantum processors to temperatures close to absolute zero and ensure their operation. The French Alice & Bob is significantly advancing error-correction architectures for useful quantum computers through cat-qubit technology. Similarly, Austria’s ParityQC builds hardware blueprints and an operating system – ParityOS – for scalable quantum computers. Moreover, some firms are already facilitating quantum applications through software access. Germany’s software company HQS Quantum Simulations offers quantum simulation methods specifically tailored for materials science, while Spain’s Multiverse Computing produces software for quantum applications in finance, energy and advanced analytics.

At the same time, European firms also remain exposed to what are increasingly recognised as potential bottlenecks. Helium-3, essential for the operation of cryogenic systems, is concentrated in US and Russian stockpiles; Bluefors’s alternative supply partnership with the American company Interlune is not expected to reach commercial viability before 2030. At the same time, manufacturing inputs face another threat from state-backed Chinese suppliers gaining competitive advantages in fibre lasers and dilution refrigerators. For example, Shanghai-based PreciLasers has quickly emerged as a major provider of quantum-grade fibre lasers at competitive prices, while QuantumCTek’s EZ-Q dilution refrigerator has reportedly achieved mass production. Moreover, control electronics like field-programmable gate arrays (FPGAs), able to optimise qubit connectivity and software ecosystems such as the dominant frameworks Qiskit and Cirq remain largely American. Most consequentially, Amazon, Microsoft and IBM are already championing quantum-as-a-service, offering users access to quantum resources remotely. In this way, they are already positioning themselves as system-level orchestrators.

These facts need to be understood against the background of a technological competition shifting towards the integration layer that, by connecting hardware, software, networking and so forth, allows quantum computers to operate as scalable systems. American cloud platforms have first-mover advantages and market clout in this regard. In fact, quantum processors will not operate as stand-alone technologies, but they will function as accelerators within hybrid architectures, accessed through cloud platforms, and connected through networking to other high-performance computing (HPC) infrastructure. Whoever defines how these layers operate together will capture more value than any single layer and will likely shape the standards around which the rest of the industry organises.

Conclusion: three strategic principles for the EU’s Quantum Act

The Quantum Act should be centred on strategic principles to inform the direction of the EU’s quantum industrial policy efforts. Such principles must balance the economic and geopolitical interests at stake. The EU must be able to secure control over key bottlenecks in the emerging supply chain; it must be able to bring domestic companies to scale despite structural constraints; and it must skilfully create the incentives for firms to help the European quantum industry operate as a system.

Principle 1 — Focus

No actor can dominate every layer of the emerging quantum stack. The EU, with a fraction of its rivals’ capital, certainly cannot, especially considering the limited time frame within which the EU’s action must take place. The EU Quantum Act should address Europe’s strategic strengths to consolidate (e.g. superconducting and neutral-atom hardware, cryogenics, error-correction software); the strategic bottlenecks where it is relatively easy to close the gaps through targeted intervention (e.g., helium-3 alternatives such as Munich-based Kiutra’s adiabatic demagnetisation refrigeration, control electronics and fabrication capacity); and dependencies which would be best managed through diversification with partners. A tiered funding architecture should sustain support for established and highly promising strengths and provide time-bound support for closing specific bottlenecks. To do so, the EU should also take inspiration from its competitors. For example, the EU could launch grand challenge competitions to attract innovators and scientists to find solutions to Europe’s most compelling strategic bottlenecks. To be competitive internationally, the EU should first encourage more competition domestically.

Principle 2 — Synergy

Quantum is an enabling technology, not an end market. Its value is realised only when connected to the industries that will use it, such as chemicals, pharmaceuticals, automotive, aerospace, manufacturing and logistics. These are sectors where the EU’s industry already shows quantum readiness. Policy should facilitate the connection of quantum developers to end-user industries. Public procurement and pilot projects must be used to pair quantum firms with established industrial users, of the kind already emerging between several European hardware and software firms and their industrial clients. The European Chips Act pilot lines should be used as a base but be more inclusive about which types of business can join. To achieve scale, potential end users must be able to participate in demonstration projects. This could also help address the EU’s scale-up financing gap: involving end users brings more private capital and can signal commercial viability. Cases such as the BMW Group partnership with US-based company Quantinuum suggest end users are interested in applying quantum. However, the EU should structure incentives to make such partnerships involve EU-based businesses. The objective of creating synergies is to demonstrate quantum advantage across end-user industries.

Principle 3 — Systems

The future of computing will be hybrid, not purely based on quantum, at least in the short-to-medium term. Quantum technologies should not be thought of as the product of vertically integrated businesses, but as modular efforts to make systems work as such. This is why the EU should not be thinking about which hardware platform to fund more but instead focus on creating the incentives for different local platform providers to scale, while encouraging the establishment and use of open architectures to allow hybrid computing. The Dutch firms QuantWare and QBlox, together with the Australian firm Q-CTRL, provide blueprints for modular on-premises systems through their Quantum Utility Block architecture. As experts note, EU quantum companies are mostly component and sub-system specialists. Thus, the objective must be to create interoperability within Europe and use it to scale at the same time. If successful, this could even be used as a bargaining chip with foreign organisations wanting to access Europe’s computing ecosystems. In this regard, standardisation will also play a major role. Efforts in this direction are already taking place globally, but the EU could do more to establish a European standard to tie to public procurement and funding access.

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