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The struggle for the European competitiveness in the world has occupied a decisive place in the EU’s politico-economic agenda. The Commission President two times in September explained some complex issues in the contemporary European discourse concerning the EU competition issues, such as cutting red tape, creating affordable energy sectors, facilitating the internal market and trade, as well as the “lightening the burden on SMEs”.
Background
The political and business power-influence in competition issues has occurred within strong components for industries and SMEs, for craft sectors and national security.
Thus, on 18 September, the Commission President Ursula von der Leyen at the high-level meeting of leading German business and industry associations underlined that the EU’s “clear and decisive mission” is the European competitiveness, which is paramount to business, employment and even the EU-wide prosperity and future. Besides, she added, that European peace and freedom depends on increased economic growth and security in terms of critical raw materials, defence and energy.
During first nine months in the new College (since the end of 2024), the EU institutions have made resolute efforts to deal with competitiveness: the Commission prepared and adopted the so-called “competitiveness compass”, Clean Industrial Deal, a plan for AI gigafactories, as well the Capital Markets Union.
Fair enough – initially, on 16 September- the Commission revealed just three main issues in the competitiveness’ struggle (just three pillars out of Draghi’s report), which on some accounts repeat the previous suggestions.
Reference to “Opening keynote speech by President von der Leyen at the ‘One Year After the Draghi Report’ Conference in: https://ec.europa.eu/commission/presscorner/detail/da/speech_25_2102.
Our comments in:
https://www.integrin.dk/2025/09/22/european-vision-on-competitiveness-progress-commissions-recent-account/
During first months in power, the Commission prepared a package of measures expected to streamline the European competitiveness: e.g. on the ‘savings and Investment Union”, together with the action plans for the steel and automotive industries; followed by the new version of the EU-wide Internal Market Strategy (revealed in May); then, in June the initiative on quantum computing and a new aid framework was formulated; in July the proposal for a new seven-year budget, placing competitiveness at the heart, with a new competitiveness fund of €400 billion, was put at the table in the member states.
Source and references from 18 September “competition” press release at: https://ec.europa.eu/commission/presscorner/detail/en/speech_25_2128
Five urgent points in the EU “straggle”
= Firstly, cutting red tape: the “doing business” issues can often be held back by the mass of rules, reporting obligations and other requirements, especially for SMEs and craft businesses in . inventing, producing and selling products. E.g. various batteries need graphite or at least a proportion of graphite, which is a critical raw material with one country having a global monopoly in it. However, 95% of the graphite in batteries can be recycled in Europe; so the member states are able turning literally waste into the key manufacturing sector.
Besides, it is necessary, as the President puts it “to strengthen demand from Europe” bringing together innovation, growth and demand, by introducing a “Made in Europe” concept in public procurement; presently, public contracts account for 14 percent of EU-27 GDP.
= The second point is about “tackling affordable energy”, the issue which is vital for competitiveness: e.g. the main reason for the high cost of energy is the EU’s dependence on the world market concerning imported energy resources. Hence, the EU is dependent on what happens in the volatile world market.
Thus, the key to European energy affordability and security is produce energy in the member states, making the whole region independent of the volatile world market, including renewables, and nuclear energy. It is clear that the member states can decide themselves about their energy mix; they have made visible progress: about 72 percent of electricity produced in the EU comes from low-carbon energy. So far, the EU-27 states managed to saved more than €60 billion in fossil fuel imports.
However, the “affordable energy” not only has to be produced, it also has to be distributed to consumers; thus, so-called clean technology which are the growing sector the worldwide future products has attracted European-wide in the first half of 2025 all-time high €34 billion investments in wind energy; and the global battery market is expected to double over the next five years, as the global market in electric cars is booming: e.g. in the EU, sales compared to last year are up by almost 25 percent (in some African, Asian and Latin American countries they were up by 60 percent in 2024).
= The third point is about the EU’s internal market: i.e. the trend of lifting market barriers, which hamper the free flow of goods for citizens and companies (to the extent of 45% customs duty on goods and 110% on services). For example, a German medium-sized company which services machinery elsewhere in the EU states must be able to send its staff to working places without any difficulty. This is why the EU want to simplify and digitalize these procedures to be finalized by the end of 2025. But if manufacturing and craft businesses are looking for suitable workers from other EU states, the recognition of professional qualifications shall be enforced; still some states do not respect the professional qualifications of others. And the member states should not impose their own national “gold standards” through gold-plating, which is just creating new barriers in the single market.
= The fourth point is about increasing the European export potentials; but the geopolitical tensions are toxic, and the EU is experiencing export controls in China, which are putting entire production lines in the EU member states under pressure. The threat of trade wars creates uncertainty, which are damaging for the investment process.
Presently, the global volatility becomes “a new normal”: e.g. the EU recent customs deal with the United States is a vivid example. However, points the President, customs duties are similar to taxes: i.e. the duties are becoming primarily taxes for American consumers. The agreed “all-inclusive cap of 15%” (with “no stacking”) means that the old customs duties are not imposed on top, so the EU companies could be “in a very competitive position”, she added.
Besides, about 80 percent of the EU external trade take place with countries outside the US.
More on common market issues in:
https://ec.europa.eu/commission/presscorner/home/en#news-block
= The fifth point is about small and medium-sized enterprises; there are about 23 million SMEs in the EU. Therefore, all new legislation at the EU level will have to undergo a new, stricter SME and competitiveness check. These are lessons that the EU institutions and the member states have learned from the past, leading to legislation that is more streamlined going forward.
Hence, the SMEs are at the center of the EU omnibus regulations concerning the internal market strategy and simplification. For example: a smaller undertaking must be allowed to exceed the threshold of 250 employees without having to shoulder the full responsibilities of larger undertakings and the Commission has introduced the new category of Small Mid-Caps. With the simplification packages, the EU is aimed at reducing the administrative burden for all enterprises by at least 25 percent and for SMEs by at least 35 percent.
Conclusion
A focal element in the European way to combat the lack of competitiveness shall be underlined: i.e. the regulatory means. The Commission has chosen “not an easy fight”, as the President noted. But, as she added, “we will only be successful if we move forward decisively”.
The bottom line is that driving forward innovation and investment, to name a few, shall be in the hands of executive bodies and institutions…
The EU competition agenda sticks to the administrative “urgency measures” to force “innovative clout” by the member states’ industries and SMEs, manufacturing and banking sectors. As the President concluded, “I ask you: bring that influence to the table”.
Only the time will tell whether this age-old EU “administrative method” could provide positive outcomes; however, the President is still “looking forward to a fascinating discussion”.
Citations from: https://ec.europa.eu/commission/presscorner/detail/en/speech_25_2128