There are quite a bit of initatives and regulations along these lines imho, like the IPCEI¹ Cloud project, the French "trustworthy cloud²" strategy, the DSA³ and DMA⁴, the US-EU DPF⁵, and the well-known GDPR⁶, among others. And AFAIK there are plenty of GAFAM datacenters in Europe already (Ireland, France, Germany, Spain, ...), with more on the way ...
I could be wrong but it seems to me then that the issues raised in interview are not so much a lack of datacenters that are physically in Europe but: a) due to foreign ownership of many of them, there is still a risk of data exfiltration, say under "NSA"/FISA directives; b) a big "red button" actuated from abroad could turn these datacenters off without much notice, and; c) "European governments did not have even a smidgen of vision" and made themselves willingly vulnerable to a single supplier and its potential failures (here: Microsoft 365 -- eg. "Microsoft Outlook is a huge source of geopolitical risk").
Then again, that may be exactly what you'all wrote as a "US cloud" (Wolfclaw) could be physically in Europe but operated by a US cloud giant, and a proper EU cloud service (AC) would need to be operated by some EU outfit instead ... So, yeah, maybe Europe wanted to have its cloud and eat it too, and then ended up with neither, so far.
¹-Important Project of Common European Interest, ²-French companies running software licensed from the US tech giants on French servers, ³-Digital Services Act, ⁴-Digital Markets Act (DMA), ⁵-Data Privacy Framework, ⁶-General Data Protection Regulation