Empowering Europe through the Fight against Climate Change

The decline of the European Union has now become undeniable, and its consequences are increasingly visible on our economy and population. While fierce debates are taking place across Europe about whether we should stay on course with our climate ambitions, conservative right-wing and far-right forces are seeking to reverse them. However, correctly identifying the root causes that have led to our societal model being challenged on the international stage means understanding that decarbonisation represents a real hope for emancipation for 21st-century Europe. More than an economic policy, the Clean Industrial Deal offers a genuine new doctrine.

A Bitter Reckoning: Time to Learn from It

The rise of extremism, deindustrialisation, impoverishment, geopolitical weakness, and energy and technological dependence are among the many factors that have cast doubt on the EU’s ability to become a power in its own right. This feeling, shared by many of us, did not appear out of nowhere. It stems from a steady decline that began at the turn of the century, and particularly after the 2008 crisis. This is the storyline laid out in the Draghi Report published in September 2024.

In a quarter-century, China’s GDP, which represented only 16% of the EU’s in 2000, reached 96% in 2023. In addition, GDP per capita grew almost twice as fast in the United States over the same period.

The main reason identified by the former President of the European Central Bank for this gap is the EU’s low productivity—largely due to its failure to embrace the first digital revolution in the 1990s.

More broadly, the EU has fallen behind technologically in several sectors, increasing its vulnerability and dependence amid intensifying Sino-American competition in which the rise of China and its alternative value system appears unstoppable. The report also points to competitiveness issues facing Europe vis-à-vis China and the US—explained in part by high energy costs. With no natural energy resources, the EU became reliant on fossil fuel imports—a vulnerability that turned critical after the outbreak of war in Ukraine. Beyond energy and tech dependence, Europe’s reliance on the US for defence has rendered it vassal-like in that domain.

Time passes and the fierce competition between the American and Chinese giants continues to grow. Their models seem ever further from our own, reminding us daily that the European Union is under threat. Our unique values—solidarity, tolerance, and freedom—cannot be preserved unless we develop the means to defend them.

Abandoning Climate Goals Means Misreading the Situation

In this context of economic hardship and compromised sovereignty, many have found an easy scapegoat. Even as the chaos of the climate crisis unfolds before our eyes, a wave of opposition is rising across Europe against decarbonisation efforts. Many claim that Europe’s loss of competitiveness, deindustrialisation, and decline have been accelerated—or even caused—by climate policies. Right now, in the European Parliament, the Council, and across national governments, debates are intensifying over whether to stick to the 2040 target for emissions reductions. While a 90% reduction target is supported by climate scientists who stress the unviability of any alternative, others argue for lower targets—or even abandoning long-term goals altogether. Within the Parliament itself, conservative and far-right parties continue to exploit the issue, promising voters a return to the “glorious thirty” years after WWII—a time of full employment, cheap and abundant energy, and rising purchasing power, unencumbered by environmental constraints.

Yet the Draghi Report is unequivocal: the downward trajectory of the past two decades was not caused by recent environmentalpolicies.

Abandoning ecological ambition will not reduce our global dependence, lower energy costs, increase productivity, or reverse deindustrialisation and impoverishment. Ignoring the actual causes of our current situation will only prevent us from implementing the solutions needed to overcome it.

As always, the same causes produce the same effects. What is needed is a shift in paradigm.

More than a stimulus plan, the Draghi Report offers a true doctrinal shift to shape the EU’s future in the 21st century. To move beyond stagnation, we must treat climate ambition not as an obstacle but as the engine of our emancipation. This vision—championed by the former ECB President and adopted by the European Commission in its Competitiveness Compass—is embodied in the Clean Industrial Deal.

The Clean Industrial Deal: Europe’s Vision for the 21st Century

Among the various measures proposed in the Commission’s Competitiveness Compass earlier this year are more traditional ones such as administrative simplification and investments in high-tech innovation. But what stands out is the environmental pillar. Following the Draghi Report’s recommendations, the goal is to make decarbonisation a real driver of industrial revival and independence.

First, to drastically cut energy costs and boost competitiveness and autonomy, the plan calls for massive electrification of the economy and even wider deployment of renewables. Second, it provides strong support for the development of a European green industry. This will not only accelerate decarbonisation and electrification but also strengthen Europe’s position in a critical tech sector. We can no longer afford to fall behind in the innovations that will shape the future—especially in areas where we already have expertise. More than €100 billion could be mobilised to support the deployment of renewables, decarbonisation, and innovation. Third, recognising our limited resources and global dependency, the plan includes a comprehensive strategy for materials: better management, more efficient use, and support for the circular economy. The remanufacturing market alone is expected to reach €100 billion. Fourth, several measures aim to correct shortcomings in previous transition efforts, including a stronger carbon border adjustment mechanism and new economic defence instruments. Fifth, a skills strategy will support training to create 500,000 quality jobs.

Again, this is more than a green stimulus. It is a long-term strategy. In this context, the 90% emissions reduction target for 2040 is no longer a constraint—but the core engine of our industrial transformation.

What once seemed the greatest challenge facing humanity—the climate crisis—could, paradoxically, become the opportunity that finally emancipates Europe.

China’s Green Strategy: A Masterclass in Long-Term Vision

For those in Europe who view decarbonisation as naïve or exaggerated, it is worth recalling that the rest of the world has not waited for the EU to act. At the forefront is China, which long ago integrated green industry into its long-term development plans. Currently the world’s largest emitter of greenhouse gases, underestimating China’s commitment to building a clean economy would be a serious misjudgment. As always with China, its approach is strategic, patient, and thorough.

For the past two decades, China has invested in mastering green technologies such as solar panels, batteries, and electric vehicles. It gradually integrated more and more of the value chain and now controls the majority of it in several industries. China now produces over 80% of the world’s solar panels and is the top producer and exporter of electric vehicles. These strategic choices required long-term vision and massive investments—made at a time when few foresaw the explosion in demand. China understood that, sooner or later, the world would have to shift from fossil fuels to alternative technologies—and it intended to lead the way. It also extended its control over rare earths, which are crucial not only to green technologies but to many of tomorrow’s innovations. China’s interlinked industrial strategies are now well established.

China has methodically built green industry into its broader development strategy based on its strengths and constraints. Europe should take note.

The Green Industrial Deal: Europe’s Inflation Reduction Act

Among countries integrating decarbonisation into their long-term strategy, the United States stands out as a forerunner. While Joe Biden’s green policies may now face headwinds with Donald Trump’s return to the White House, we must not overlook the significance of one of the largest plans enacted in the US in decades.

The Inflation Reduction Act was not only a climate victory—it aimed to reorient the US industrial base amid intensifying global competition with China. Massive subsidies for households (e.g., for electric vehicle purchases) and green industries were meant to boost production and steer the US economy toward the industries of tomorrow. It also aimed to restore the middle class—long affected by deindustrialisation and declining job prospects.

It’s worth noting that the US benefited from specific conditions: a strong economy, a powerful federal state, and low electricity costs. The green strategy was tailored to these strengths.

A United Europe Is Essential for Overcoming the Challenges Ahead

First, not all industries can be saved during this vast transformation. Unfortunately, no large-scale studies have been conducted to determine which sectors are truly competitive in Europe. The question of which industries to prioritise remains taboo.

Second, implementation will be critical. To succeed, the plan must be coherent and well-executed. But since some funding will be allocated by national governments, they may favour their own industries—even those no longer competitive. Effectively capitalising on the EU’s single market will be key.

Finally, in terms of political fragmentation, the temptation to water down climate and energy transition targets remains strong. But while the US and China are implementing similar paradigms with long-term strategic depth, Europe’s own characteristics and weaknesses make its rapid ecological transition even more urgent. If we want to regain competitiveness and sovereignty, relaunch our industry, and reclaim strategic sectors, we must act now. Prosperity is the only path to securing our social systems and continued progress. Maintaining the 90% emissions reduction target for 2040 is therefore essential. It is not a constraint, but the engine driving the transformation of our industry—and, ultimately, our continent’s emancipation.