The world literally has hard proofs of mass espionage by the NSA and CIA after Snowden and Wikileaks Vault 7. Moving your government secrets to the US cloud has been madness for at least 12 years.
If China and Russia can somehow solve the issue and manage their infra, I don't see why EU, for example, can't.
It's better to have at least partially protected your whole government and citizens data than having it handed directly to the foreign intelligence in bulk. That's the question about political will, we don't talk about average Joe here.
When I last looked into it, the compute overhead was very high, such that (for the tasks I was looking at) it seemed significantly cheaper to handle everything on-premises with trusted hardware than remotely on untrusted hardware.
To be clear, this was 10 years ago so things may have changed. Also, my task was memory bandwidth limited, where even changing the memory access patterns slowed things down by 10% or more.
