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Two months after Germany announced its intention to compete in the global quantum computing industry, funding is set to be slashed to the tune of 200 million following budget cuts announced by the government.

In May, the government pledged a new action concept on quantum technologies to position the company as pioneers in the sector, with some 2 billion earmarked for quantum research and development.

But the governments draft of the 2024 federal budget seeks to implement austerity measures and cuts to comply with the debt brake, a law which limits new debt to 0.35% of the countrys GDP each year.

The budget negotiations this year took place under a challenging condition, as for the first time an austerity budget had to be imposed again, a spokeswoman from the Ministry for Economic Affairs and Climate Action (BMWK) told EURACTIV.

BMWK said that federal funding for the Quantum Computing Initiative of the German Aerospace Centre would be reduced by 200 million, which will see a downsize in the previously announced ambition to compete with countries like the US, China, and Japan.

The announcement has been met with harsh criticism, particularly from the opposition.

This hits the promising German startup scene in particular, and it is a big strategic mistake, Christian-democrat member of parliament Thomas Jarzombek told EURACTIV.

Quantum computers use quantum physics to store data, carry out tasks and perform computations in a way that significantly outperforms even the best supercomputers and can decode common encryptions. Due to their immense capabilities, many experts consider the technology as one of the most disruptive of our times.

The Economic Stimulus and Future Package 2020 was introduced three years ago as a measure during the coronavirus pandemic to revitalise the economy, with measures worth 130 billion euros. The means included cutting value-added tax, allocating financial allowance for families, and steps to stimulate future technologies.

As part of the package 2 billion is available for research and development in quantum technologies, reads the German governments Quantum Technologies Action Concept.

The Economic Stimulus and Future Package includes, among other things, funding for the Quantum Computing Initiative. According to the Federal Ministry of Economics, the original amount of total funding for this quantum computing initiative was 740 million.

Around 80% of these funds are earmarked for research and development contracts to companies, especially startups, and the remaining 20% for engineering research and development at the German Aerospace Centre, the BMWK spokeswoman told EURACTIV.

The funding would primarily enrich startups in their further development of preliminary products such as lasers and vacuum pumps, and thus move Germany forward in international competition.

We will have to put a lot of effort into keeping up with the fast pace of international competition. We have what it takes, Jarzombek emphasised.

According to the conservative MP, one of the most promising initiatives for international competition is the QuNet initiative.

Based on state-of-the-art quantum technology, the initiative, funded by the German Federal Ministry of Education and Research (BMBF), is developing highly secure communication systems to create a foundation for cyber-secure and robust IT networks.

Especially in the field of quantum communications, Germany has a huge potential that could also strengthen the European Union as a whole, Jarzombek added.

The BMWK spokeswoman assured that the goals of the April 2023 Quantum Technologies Action Concept remain unchanged and will continue to be adhered to, despite reduced funding.

She also said that the existing funding volume of a good half a billion euros for the DLRs Quantum Computing Initiative until 2026 forms a strong starting point for achieving promising results despite the considerable savings.

[Edited by Luca Bertuzzi/Alice Taylor]

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Germany's debt brake: 2024 tech funding programs on the back burner - EURACTIV