Medium scenario unless stated

Until now, EU policymakers have discussed the Cloud and AI Development Act (CADA) using incomplete data that understates the financial impact of its ‘sovereignty’ requirements on taxpayers and businesses. This new study by ECIPE reveals the real-world costs missed in the European Commission’s official impact assessment.

Under a realistic, moderate implementation scenario, CADA will create €115 billion in cumulative economic exposure across the EU27 over a ten-year period (2027-2036). If Member States mandate ‘sovereignty’ for half of all private essential entities and gold-plate these rules, that figure would surge to €233 billion.

This map shows the total modelled economic footprint of CADA (2027-2036) per Member State, broken down by cost type and domain. It combines three primary burdens: one-off software re-architecting costs, 10 years of recurring ‘sovereignty’ price markups, and postponed cloud and AI productivity gains.

Hover over any Member State on the map to view its estimated financial exposure across all three scenarios (Narrow, Medium, Broad). Select a country to open its national impact report.

Figures for Germany, France, Italy, Spain, Poland, the Netherlands, Belgium and Austria are reported; the remaining member states are modelled from the EU27 residual.

Across all implementation scenarios, CADA’s total economic footprint over 10 years – reaching €115 billion in our central Medium baseline – is driven by four key mechanisms. Select a shock to see its breakdown.

Public authorities are directly hit in their operational and procurement budgets by CADA. Under our central Medium scenario, the public sector carries €35.1 billion in cumulative economic exposure over ten years. Out of this, €33.3 billion consists of higher ongoing cloud bills and software migration costs that must be funded by European taxpayers. An additional €1.8 billion is lost in delayed public service digitalisation.

Hover over any Member State on the map to view its estimated public sector bill exposure across all three scenarios (Narrow, Medium, Broad). Select a country to open its national impact report.

Figures for Germany, France, Italy, Spain, Poland, the Netherlands, Belgium and Austria are reported; the remaining member states are modelled from the EU27 residual.

CADA extends far beyond government procurement. Under Article 31, regulators can extend strict sovereignty rules to private companies operating in essential NIS2 sectors – including energy, transport, banking, healthcare, and water utilities.

While annual EU public sector cloud spending is roughly €4.1 billion, the private essential sector spends over €61 billion. Extending CADA requirements to just 25% of essential private cloud workloads (our central Medium scenario) adds €80 billion in private adjustment costs – accounting for 70% of CADA’s entire €115 billion economic footprint.

Hover over any Member State on the map to see the financial exposure facing its regulated essential private industries across all three scenarios (Narrow, Medium, Broad). Select a country to open its national impact report.

Figures for Germany, France, Italy, Spain, Poland, the Netherlands, Belgium and Austria are reported; the remaining member states are modelled from the EU27 residual.

To compare national impacts fairly across economies of different sizes, this map divides each Member State’s 10-year total economic bill by its working-age labour force.

Hover over any Member State on the map to view its estimated financial exposure across all three scenarios (Narrow, Medium, Broad). Select a country to open its national impact report.

Modern European tech companies build their products using global cloud platforms, tools, and databases. When higher assurance levels restrict these foreign technology inputs, European software vendors face forced product redesigns, downgraded functionality, and supply chain disruptions.

Building out compliant European sovereign cloud capacity will not happen on private investment alone. To meet CADA mandates, taxpayers will likely be asked to provide public grants, subsidies, and state aid to accelerate data centre construction and infrastructure upgrades.