The EU competitiveness compass: Europe's roadmap to sustainable prosperity

The European Commission has unveiled its 'Competitiveness Compass' - the first major initiative of the new mandate. The aim: to establish Europe as a driver of innovation and the first carbon-neutral continent.

Why Europe needs to catch up

Over the past two decades, the EU has lost ground in productivity growth. But Europe has all the resources it needs to reverse this trend: a highly skilled workforce, capital, a strong single market and a stable social infrastructure. Now is the time to remove structural impediments and regain competitiveness.

Ursula von der Leyen: Speed is of the essence

Commission President Ursula von der Leyen said: 'Europe has what it takes to compete in the global economy. But we need to act more decisively. The Competitiveness Compass translates the recommendations of the Draghi report into a clear roadmap. What we need now is speed and unity - the world will not wait for us.

Three priorities: innovation, decarbonisation, security

1. Unleashing innovation

• The EU will provide targeted support for start-ups and deep-tech industries.
• 'AI gigafactories' will be set up to advance artificial intelligence.
• New EU strategy for scale-ups: less red tape, more growth.

1. Decarbonisation & affordable energy

• Promote clean industries while reducing the burden on energy-intensive industries.
• An 'industrial deal for clean technologies' will strengthen sustainable business models.
• Accelerated approval procedures for climate-friendly innovations.

1. Less dependency, more security

• Expanding trade agreements. New partnerships will secure raw materials, energy and key technologies.
• Revised procurement directives will allow European preference for strategic contracts.
• More EU defence cooperation: joint arms purchases, pooling research and development, integrating industry, creating a single defence market, easier access to finance for SMEs.

Five levers for sustainable competitiveness

1. Cutting red tape: the aim is to reduce administrative burdens by 25% for businesses and 35% for SMEs.

2. A strong single market: common standards and faster standardisation procedures for SMEs.

3. Efficient capital markets: a European savings and investment union to better mobilise private financial resources.

4. Strengthening the skills base: promoting training, recruitment and mobility.

5. Better coordination: a new instrument to ensure the implementation of common EU objectives.

The background

The compass is based on the Draghi report, written by Mario Draghi on behalf of the Commission. It warns that Europe can no longer rely on past growth drivers. The EU must act - decisively, in a coordinated way and quickly.

Source: European Commission