Luxembourg’s government is to co-fund a research and development (R&D) project focused on artificial intelligence (AI) involving one of Europe’s biggest banks and the University of Luxembourg.
BGL BNP Paribas is the first private bank with a project involving AI that will benefit from government co-financing as part of an ‘R&D and Innovation’ grant scheme in the European Union (EU) member state.
The project is expected to see a total spend of nearly €7.4 million (about £6.3m/$8m) over three years, with an Ministry of the Economy-managed ‘Innovation Fund’ contributing up to €2.95 million. It will see the bank – which will contribute the bulk of the funds – and the university’s Interdisciplinary Centre for Security, Reliability and Trust (SnT) co-operating on the development of what is described as an AI ‘metamodel tool’.
The Ministry of the Economy and Ministry of Finance’s joint-announcement of the project makes reference to the new Luxembourg government’s coalition agreement 2023-2028 (FR language) signed on 16 November 2023. Luc Frieden became prime minister after six weeks of talks as the incumbent coalition, led by Xavier Bettel, lost its majority in the previous month’s parliamentary election.
‘The exploitation of AI offers immense potential to boost many sectors of the economy, including finance, as well as to simplify the lives of citizens. Its development is one of the priorities of the coalition agreement,’ the two ministries’ joint-announcement (FR language) declares. ‘The government intends in particular to further stimulate Luxembourg’s economic diversification in order to create, or even strengthen, ecosystems in priority sectors, including the field of AI.’
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‘Hope other players will follow’
Luxembourg – which is bordered by France, Germany and Belgium – has a population of just 650,000, but is a prominent financial centre and home to numerous EU institutions and agencies, including the European Investment Bank (EIB).
Economy minister Lex Delles and finance minister Gilles Roth both attended a press conference at the BGL BNP Paribas headquarters to discuss the project and importance of AI to Luxembourg’s public and private sectors.
“AI is a promising technology of the future that can contribute to the competitiveness of Luxembourg by helping us to gain productivity,” Delles said. “The Ministry of the Economy is pleased to be able to support BGL BNP Paribas to carry out this innovative project, which will certainly contribute significantly to the development of skills in the field of AI in Luxembourg. Ultimately, this could strengthen the position of the Grand Duchy [of Luxembourg] internationally on this issue. I hope that other major players in the [financial services] market will follow the example by also launching R&D projects linked to AI.”
“Artificial intelligence is a transformative technology,” said Roth. “Businesses that embrace it responsibly will have a competitive advantage in tomorrow’s data-driven economy. So it’s encouraging to see that one of our leading banks is tackling the opportunities and challenges of AI head on.”
As an EU member state, Luxembourg will need to implement the 27-member bloc’s relatively high-profile forthcoming AI rules. European Parliament and Council negotiators reached a provisional agreement on the EU AI Act in December.
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‘Audacious’ research programme
BGL BNP Paribas has operations in retail, corporate and private banking. Part of the Paris-headquartered BNP Paribas Group, it already uses AI at several levels, notably for risk management, payments, ‘understanding and processing’ emails, as well as in credit management and ‘processing regulatory obligations’.
SnT, meanwhile, describes itself as a ‘hub for technology with impact’ undertaken research alongside industry focused on four areas: fintech, cybersecurity, Internet of Things and autonomous vehicles, and space systems.
BGL BNP Paribas and SnT have previously collaborated on other AI projects.
This aim of this new initiative is to create a tool able to supervise and monitor all AI solutions in production on BGL BNP Paribas infrastructure, with the ultimate aim of facilitating a scaling-up of AI deployment.
Béatrice Belorgey, chairwoman of BGL BNP Paribas’s executive committee and head of BNP Paribas Group entities in Luxembourg, described the R&D programme as “audacious” because it “addresses a technological challenge that is still little explored but which is nevertheless key to accelerating the industrial development of AI and its uses in our bank.”
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Luxembourg state’s own AI ambition
In a separate AI use-case scenario being promoted by Luxembourg’s government, the coalition agreement references AI in a section labelled ‘Digitalisation’ focused on public service operations and delivery.
‘The government is committed to advancing digitalisation in public service and thus allowing citizens and businesses to carry out all of the country’s administrative procedures digitally,’ the 209-page document states. ‘These processes will be simplified and made more accessible for people less familiar with digital technology. Artificial intelligence is becoming increasingly important and the state has already carried out pilot projects in this area.’
‘It will be essential to put in place an appropriate framework and to have these initiatives supported by professionals,’ the coalition agreement’s text continues. ‘New technologies, notably chatbots, promise valuable assistance by providing explanations and information to citizens.’
‘Collaboration between administrations will be strengthened while respecting data protection standards. This will make it possible to share documents between the different administrative entities and thus avoid unnecessary procedures. Each administrative procedure will be accompanied by a “follow-up” reference number to help citizens and businesses follow the status of their requests at any time.’
‘In this perspective, it will be necessary to increase investments in infrastructure and strengthen the technical skills of public service agents. Alongside ongoing digitalisation, continuing education will play an essential role in this development. The government will commit to advancing the technical skills of public service personnel and equipping them to best accomplish their public interest mission.’
AI is also mentioned in the context of the modernisation of tax collection. ‘Digital exchanges with tax administrations will be encouraged’, the document states, adding that ‘administrative procedures will be digitised, also using artificial intelligence’.