Scott (from the video [1]) says the same thing, Europe added regulations because it was getting all the tech downside without the upside, and should close down the market and create local alternatives.

I don't know if copying China is a great move for innovation though.

The EU would have to become much more powerful to be able to do that, which is scary to me seeing what happens in China.

I think you are right, maybe they should look into creating a tech hub somewhere in Europe, maybe reduce taxes or regulations there, but who knows.