The US and China are busy battling for supremacy on the frontiers of technology infrastructure such as 5G and internet of things. Both countries are investing heavily to build a technological edge, as they believe a superior product will allow them to establish technical standards that will become adopted globally.
The European Union is taking a different approach. While government investment in European tech lags the US and China, the EU is the leading exporter of regulatory standards globally in key areas such as data protection.
The EU has been a more effective policymaker than either China or the US. In the US, Congress has struggled to build consensus for tech regulation. International companies are generally excluded from China's policy process and so are resistant to adopting regulatory regimes set in Beijing.
While the US and China battle to develop a technological edge, they may be fighting the wrong battle.
But the US and China are not the only players in the game. Despite its underpowered tech sector, the third great trading power, the EU, has big ambitions as a rulemaker. European officials are quietly confident that, as with the “Brussels effect” whereby EU rules on cars, chemicals and food have been adopted around the world, so its regulatory process will play a large role in shaping the global digital economy.