FST JOURNAL

Imagine that Vice Admiral Eugene H Black III, commander of the US Sixth Fleet, suddenly requested something unpalatable of UK Prime Minister, with his fleet stationed in the English Channel. The Government and most people in the UK would regard this as a strange manifestation of the ‘special relationship’ between the USA and UK, as well as a flagrant violation of UK sovereignty.

Curiously, when former US Secretary of State Mike Pompeo requested the UK stop using Huawei 5G products, both governments understood that the USA indirectly controls the payment infrastructure of the City of London and that US chip and electronic design tool software is needed for the design of all UK electronic chips.

The UK acquiesced despite a thorough analysis by GCHQ, Britain’s intelligence agency, concluding that Huawei products were safe to use in non-critical parts of the country’s 5G infrastructure. Pompeo’s request was no less forceful than having a US naval fleet moored in the Thames Estuary. 

Sovereignty is conventionally considered as something that stems from the barrel of a gun or muzzle of a missile launcher. It is usually defined as the ‘supreme authority in a territory’ but is often thought of as being free from dependence on others. This classical account of sovereignty has to do with possessing the military might to either strong-arm other nations or deter them.

With the rise of technology, this classical view has changed faster than we could have imagined, in large part because of the importance of some technologies to our healthcare, economy, security and day-to-day lives. Many critical technologies make sure our hospitals, schools, modes of communication, financial system and food production continue to function unencumbered. Critical technologies have become so ubiquitous in our lives that the economy, society and our day-to-day lives would be disrupted without them.

This dependence was especially clear during the Covid 19 crisis, which showed how fragile supply chains around the world are and how no  country was prepared with the PPE, ventilators or medicines their populations needed. The reliance of the world on Chinese manufacturing was unlike anything seen in a long time.

Technology sovereignty is the iconic issue of the 21st century, as countries race to control all critical technologies. Consider ARM, Britain’s crown jewel, whose microprocessors power more than 95% of the world’s smartphones with over 200 billion units sold. ARM was acquired by Japanese investor Softbank in 2016, and in 2020 US-based NVIDIA began a campaign to acquire them.

With the intervention of the US, UK, and EU competition authorities, the acquisition attempt was curbed because of its implications on technology sovereignty. If the sale had gone through, the US-based NVIDIA could prevent ARM from selling licences to NVIDIA competitors around the world and save the best licences for itself. US export controls would have meant the future of ARM’s global footprint would be decided in the White House instead of No10.

Such dependencies in many areas of critical technologies would open Britain up to the risks of economic coercion by other nations through market- leading companies, coercion as effective as the military version of yesteryear but much more subtle. This has the power to disrupt our economy and create undesirable geopolitical leverage. We face the risk of becoming a technological colony of another nation if we do not have Technology Sovereignty in all, or at least some, critical technologies.

Key questions

Britain must ask itself three important questions:

1. Do we have the critical technologies ourselves?
2. If not, do we have access to these technologies from a number of independent countries to ensure a diversity of supply?
3. If still not, do we have guaranteed, unfettered, long term (i.e. greater than five years) access to monopoly or oligopoly suppliers of a single country (typically the USA or China)?

If Britain answers ‘No’ to these questions, it must do whatever it takes to build or secure capabilities in those technologies. One key question then becomes: which territories can be technologically sovereign in all critical technologies?

The world is already beginning to form into three Technology Sovereignty Circles, the USA, China, and Europe which represent the only nations or groups of nations capable of controlling access to all critical technologies. All other nations in the world will have to join one of these Technology Sovereignty Circles in order to access them and flourish in the 21st century.

To bolster its Technology Sovereignty, the USA has initiated a $100 billion technology independence programme and the EU is considering its own €100 billion fund. Meanwhile, China is the single largest investor in many areas of technology innovation including green technology, 5G and artificial intelligence.

To avoid becoming a technological backwater or technological colony, the UK must begin organising its affairs to build new capabilities in critical technologies. It can achieve this by scaling breakthrough companies at speed and securing the design, manufacturing and supply chains of critical technologies.

The UK does not have a problem in technology research with four out of the top ten global academic institutions based here. It also has no issue starting enough companies with a number of high-tech innovation clusters around the country. The Catapult centres that were established in 2010 (now over 40 in many areas of technology innovation and with further Government support) have also been a success in translating research to industry through commercial applications. The problem is not growing companies fast enough and big enough at home, a point recognised in the 2022 UK Digital Strategy published on 13 June¹.

Looking to the future, there are four key technologies that will become as ubiquitous as ARM microprocessors in smartphones and as important as PPE during the pandemic:

• Artificial Intelligence and machine learning;
• Quantum computing;
• Blockchain and smart contracts;
• Synthetic biology.

Britain has had a strong start in each of these areas with a number of research groups at different institutions and new cutting-edge companies emerging out of different clusters. To exploit this, Britain must establish a new minimum £5 billion p.a. technology sovereignty fund (less than 0.25% of annual GDP) that is focussed on making equity investments, matched by the private sector, in deep-tech companies in these four areas throughout the lifetime of the company. The ambition of this fund would be to turn these early stage deeptech businesses into world-leading technology companies that are based and owned domestically.

To avoid becoming a technological backwater or technological colony, the UK must begin organising its affairs to build new capabilities in critical technologies.

Collaboration

At the same time, the UK cannot build technology sovereignty in all critical technologies alone. A new international process of supranational collaboration will ultimately need to emerge to counterbalance the ongoing and ever-accelerating US-China trade war that is concentrating access to these technologies into a new bipolar international order.

This new international process should be predicated on a new human right: one where all citizens have access to critical technologies, much like the right to life, property, and privacy. It would be founded on the basis of subscribing to shared common values in return for collective access to key technologies.

The UK can and should play an important role in engaging with partners to align on shared values. Think of a United Nations dedicated to spreading access to critical technologies and regulating the use of dual-purpose technologies, creating interoperable standards, reciprocal IP sharing arrangements, cross-border working arrangements in complex R&D, and supporting the growth of world-leading technology businesses between them. This is an approach to technology access focussed on value alignment instead of hegemony.

If a new international process is ultimately created, nations around the world will join and sign up to these shared values to avoid becoming a technological backwater or technological colony of the USA or China. This way forward provides the foundation for a new single Technology Sovereignty Circle that can scale globally. The US and China would then have no choice but to join or risk being left behind as they only represent one-fifth of the global population.

Through this dual internal and external approach, the UK has the opportunity to build Technology Sovereignty in a way that will ensure its citizens have access to the four technologies that will be the PPE of the future. It will also support the creation of world-leading companies to restock our Technology Sovereignty chest with new crown jewels, working with like-minded partners through shared values.

¹ https://www.gov.uk/government/publications/uks-digital-strategy