Photo by Rafay Ansari on Unsplash
The blueprint for a net-zero industry “lacks vision on how to ensure Europe’s industry stays competitive and attracts investment.”
That is the view of the European Economic and Social Committee, the body that represents the various economic and social components of organised civil society. It is an institutional consultative body established by the 1957 Treaty of Rome.
The Green Deal Industrial Plan (GDIP) and the Net Zero Industry Act (NZIA) are good overall, says the EESC. But they should be more specific as to what actions will be taken to improve locational factors, boost the competitiveness of Europe’s economies and set the EU apart from its systemic rivals.
“We are very critical of the fact that it has taken something like the Inflation Reduction Act in the USA to spur the EU into action,” says Sandra Parthie, rapporteur of the EESC opinion on the GDIP and NZIA.
“We would have liked this to come earlier. We would have liked the EU to react more forcefully and with more conviction, to show our companies and societies that we really want Europe to remain relevant as an industrial location, with good jobs and good salaries for workers.”
European industry has become less competitive than that of its main rivals over the past decades.
Per capita GDP in the EU has dropped from around 70% of per capita GDP in the US in the 2000s, to under 66%. US and EU shares of the world’s gross investment have declined from 29% to 20% and from 23% to 15% respectively between 1999 and 2020.
Meanwhile China, which only had 5% in 1999, had 29% in 2020. The EU has the ability to change this: completing the single market could add more than EUR 700 billion in economic output over 10 years, and a common digital economy could contribute another EUR 178 billion.
The EU could also gain more by establishing and promoting European standards globally, says the EESC.
To reverse this downward trend, the EESC recommends carrying out an audit to identify how the EU can control and improve its value chains and avoid excessive dependencies. It has also suggested that the EU should submit all draft legislation to a competitiveness check.
