As geopolitical competition intensifies and economic interdependence becomes increasingly vulnerable to strategic coercion, Europe is redefining economic security as a core pillar of national and regional security. This paper argues that protecting strategic industries is no longer solely an economic objective but a geopolitical necessity for preserving Europe’s resilience, technological leadership, and long-term strategic autonomy.
The European Centre for Strategic Studies and Policy (ECSAP)
For much of the post-Cold War period, European economic policy was built upon a relatively straightforward assumption: greater globalization would produce greater prosperity, deeper political cooperation, and ultimately greater international stability. Economic integration was widely regarded as a force capable of reducing geopolitical tensions by creating mutual dependence among states. The European Union became one of the strongest advocates of this model, promoting open markets, liberalized trade, foreign investment, and increasingly complex global supply chains. European industries expanded their international production networks, multinational corporations optimized manufacturing across multiple continents, and policymakers viewed economic openness as both a commercial and political success. Security policy and economic policy largely evolved along separate paths. National security focused primarily on military threats, while economic policy concentrated on competitiveness, innovation, and market efficiency. This separation reflected an era in which globalization appeared capable of insulating economic relations from geopolitical rivalry.
During the past decade, however, this assumption has steadily eroded. Successive international crises have demonstrated that economic interdependence can generate strategic vulnerabilities alongside economic benefits. Disruptions to global supply chains, geopolitical confrontations, technological competition, sanctions regimes, energy crises, and increasing state intervention in international markets have collectively transformed the European understanding of economic security. Rather than viewing globalization as an irreversible process of integration, policymakers increasingly recognize that economic relationships can also become instruments of political influence and strategic pressure. Dependence on external suppliers for critical technologies, energy resources, industrial components, pharmaceuticals, and digital infrastructure has emerged as a potential security liability rather than simply an economic efficiency.
The transformation has been particularly visible within Europe’s industrial sector. Manufacturing industries that once prioritized cost efficiency above all other considerations are now reassessing the resilience of their supply chains. Governments have become increasingly concerned that excessive dependence on external production networks could undermine national preparedness during periods of geopolitical instability. Strategic industries—including semiconductors, artificial intelligence, telecommunications, aerospace, defence manufacturing, pharmaceuticals, critical minerals, and advanced manufacturing technologies—have consequently moved from the realm of industrial policy into the broader framework of national security planning. Economic resilience has become inseparable from strategic resilience, reflecting a growing recognition that military capability ultimately depends upon industrial capacity, technological innovation, secure supply chains, and reliable access to essential resources.
This shift represents one of the most profound changes in European strategic thinking since the end of the Cold War. National security is no longer measured solely by military expenditure, alliance structures, or defence capabilities. Increasingly, it is assessed through the resilience of domestic industries, the security of technological ecosystems, the protection of critical infrastructure, and the capacity of national economies to withstand external shocks. Governments have begun to acknowledge that strategic competition increasingly unfolds through investment restrictions, export controls, technology transfers, industrial subsidies, cyber operations, and supply-chain disruption rather than through conventional military confrontation alone. Economic policy has therefore become an essential instrument of geopolitical strategy.
For the European Union, this transformation carries particular significance because its economic model has historically relied upon openness. Unlike many major powers, Europe built much of its prosperity upon international trade, cross-border investment, integrated production networks, and regulatory leadership within an increasingly globalized economy. While these characteristics remain considerable strengths, they also expose European industries to external risks that have become progressively more visible. Strategic competitors can exploit commercial dependencies, restrict access to critical technologies, manipulate supply chains, or employ economic measures to pursue geopolitical objectives. Consequently, the traditional distinction between commercial policy and security policy has become increasingly difficult to sustain.
Economic security has therefore emerged not as a rejection of globalization but as an effort to make globalization more resilient. European policymakers are not seeking comprehensive economic isolation or widespread protectionism. Rather, they are attempting to identify those sectors where excessive dependence could generate unacceptable strategic risks. This distinction is critical because it reflects a more selective approach to economic openness. Markets remain central to European prosperity, yet strategic sectors increasingly require additional safeguards to ensure continuity during periods of international tension. Industrial resilience, technological sovereignty, and secure access to essential resources are gradually becoming as important as market efficiency in shaping economic decision-making.
The growing importance of economic security also reflects broader changes in international competition. The global economy is increasingly characterized by strategic rivalry rather than purely commercial interaction. Governments are intervening more actively in industrial development, protecting emerging technologies, subsidizing domestic manufacturing, screening foreign investment, and strengthening national innovation systems. Economic policy is no longer confined to promoting growth; it has become an instrument through which states pursue geopolitical influence, technological leadership, and long-term strategic advantage. Europe is responding to this evolving environment by reconsidering how openness, resilience, and competitiveness can be balanced without undermining the principles that have historically supported its economic success.
Ultimately, the rise of economic security represents a recognition that prosperity and security are no longer separate policy domains. A nation’s ability to innovate, manufacture advanced technologies, secure critical infrastructure, and maintain resilient industrial capacity increasingly determines not only its economic performance but also its geopolitical influence and strategic autonomy. For Europe, protecting strategic industries is therefore becoming less a question of industrial policy than one of safeguarding its future capacity to act independently in an increasingly uncertain international system.
