ClimateDigitalEnergyEnvironmentHealthIndustry

Giving rise to new European industrial leaders capable of ensuring Europe’s strategic autonomy

Where we stand today

Since the outbreak of Covid-19, Europe has been operating in a crisis mode. In order to protect the health and lives of our citizens and to prevent the collapse of our health care systems, we have primarily focused on supporting Member States in their fight against the Covid19 virus: Further, we helped to stabilize the economy by providing for financial support and keeping the internal market open, thus guaranteeing the free movement of people and the free flow of goods and services.

However, precautionary measures taken by the European Union as well as by the Member States to prevent further Covid19-spreading, such as countrywide shutdowns or current restrictions like curfews come at an economical cost. The effects of the recession, which Europe is entering at the moment, will still be seen in the years to come even though we have a strong industrial base in Europe. In order to prevent a deepening of the recession, the European Union enacted stimulus packages of unprecedented sizes, the Resilience and Recovery Fond and Next Generation EU programme, the details of which are currently negotiated between the European Parliament and Member States.

Lessons to be learned from the Corona crisis

Covid19 made clear that, to some extent, Europe is heavily dependant on other regions in the world. This is particulary true with regard to specific drugs and digital infrastructure. E.g.: At the beginning of the crisis, we had a shortcut in masks, medical equipment and some drugs. Further, our communication and cloud services were and still are exclusively based on infrastructure from providers outside Europe.

The Commission issued its Communication on a New Industrial Strategy for Europe before the outbreak oft he Corona crisis, thereby analyzing the new and ever-changing geopolitical realities such as global market distortions, protectionism and trade tensions which are having a profound effect on Europe’s industry.

This analysis is even more true if we look at the experiences made during the crisis. Therefore, the lessons to be drawn from Covid19 are clear: We Europeans have to become more resilient, thus move for strengthening Europe’s autonomy without being protectionist.

The Challenge

Strengthening Europe’s autonomy is dependent on a strong economy. Europe’s way out of the recession should be guided by a clear roadmap, which shows the way to go but allows at the same time for companies to adapt their business models to market needs within the given political framework. Europe is full of talented and creative people in business, industry and academia. Let us give them all the support necessary for them being innovative!

Companies can only take over European and global leadership if politics refrain from detailed regulation but focus on clear goals set for Europe. These are: Empower our talented people, invest in a strong decarbonised industry and take over leadership in digitalisation.

Invest in people and technology

Europe’s strength are its talented people! Due to excellent education systems in the Member States, our people are best qualified to invent, create, experiment! Policies should therefore focus on investments in people and technology as we are planning to do with e.g. the new Horizon Europe research programme, the Erasmus progammes etc.

Considering investments, let us focus on SMEs when looking for innovations: All over Europe we have family undertakings, small and medium sized companies which are very close to business and consumers needs. Companies know their markets and are flexible in aligning with specific needs. Our investment policy should therefore reflect these huge potentials!

Making the Green Deal A Success

The Green Deal has set ambitious targets, which could become primary drivers of Europe’s economic recovery. New technologies for decarbonisation, the roll-out of green hydrogen and renewable energy should enable our companies to become leaders in their respective fields.

In order to achieve this, we need to promote the goals of the Green Deal through innovations and incentives, not through bans or strict regulation.

Now, more than ever, we need to ensure that green legislation does not create additional red tape. We need to screen the climate policy measures as to whether they are effective and cost-efficient. This requires, in particular, affordable energy and raw materials. Further, climate policies must be streamlined with our industrial policy and the recovery plans for our economy.

Europe will be in the lead and, thus a global frontrunner, if we create lead markets in clean technologies which are affordable. Only under these circumstances, other regions in the world will follow our way in becoming carbon neutral. We have to show that carbon neutrality works and is not jeopardizing our jobs in Europe and our social welfare system.

Digital Leadership

The pandemic has shown how much we rely on digital technologies in our daily work and communication. Students working remotely and businesses operating in home office mode are the most striking examples.

Strengthening digital technology will play a unique role in Europe’s competitiveness and its autonomy in the digital sphere.

In order to compete for global technological leadership with the giants in the US and the state-owned economy in China, Europe as a whole must substantially increase R&D investments and go for the next technological leaps.

Key priorities must be quantum technology, artificial intelligence, machine learning, data science, new energy technologies, smart grids, energy storage, energy efficiency, medicine and health in European networks.

Digital sovereignty also includes a European research data cloud system or a European research data infrastructure. Critical hardware, such as semiconductors and processors, should also be produced in Europe, European cloud services should be available and data should be processed in Europe.

All this should be part of Europe’s digital agenda. Providing broad access to state-of-the-art digital technology, especially for our SMEs, will be a significant boost for Europe‘s economy.

Strategic autonomy

Ensuring strategic autonomy is key in this new and changing geopolitical environment. The European Union is an open market, but has to ensure fair competition with foreign competitors and investors. Thus, the White Paper of the Commission on an Instrument on Foreign Subsidies is welcome as we have to address distortive effects caused by foreign sudsidies within the single market. Further, as we rely on free and fair trade with partners all over the world, we should work on strengthening the World Trade Organization which requires some changes in the current structure of the organization.

Summary

Let us suppose that we enable our industry to achieve climate goals with new technologies and digital solutions while ensuring their competitiveness and access to global markets: In that case, I am convinced that Europe has an excellent chance to give rise to new industrial leaders who not only contribute to our European strategic autonomy but who also demonstrate what we Europeans are so proud of: Our values such as freedom, democracy, rule of law and cultural diversity. Yes, we care for the environment and the climate. Yes, we allow everyone to be unique, but we also have to take care of the ones who need our help. That is the European Way of Life.