BusinessEurope Headlines No. 2021-19

Competitiveness and innovation: crucial elements for the zero pollution action plan

“There is no question on the ‘if’ but rather on the ‘how’ we will make Europe’s transition a success”, said Alexandre Affre, Deputy Director General of BusinessEurope at the EU Green Week closing session, which took place on 4 June virtually. Alongside the European Consumer Organisation, the European Environmental Bureau, the European Council of Young Farmers and Housing Europe, the panel exchanged on the main takeaways from the zero pollution action plan, and on the recently announced zero pollution stakeholder platform. Affre highlighted the importance to always consider the competitiveness angle that should be a key component when implementing the plan. He further stressed the need to foster innovation as it will be the driver for future successes, while also acknowledging that the measures we bring to the table are technologically and economically viable.

Contact: Cecilia Serrano-Piedecasas

Our comment

Trade policy and industrial strategy working together

By Luisa Santos, Deputy Director General

The EU has recently revised its industrial strategy and is also undergoing a revision of its trade policy. The important question for business is how the two can work together, be mutually reinforcing and improve the EU’s resilience and global competitiveness. Europe’s competitiveness depends on the strength of its single market but also on companies’ ability to import, export and invest around the world. So how can the EU’s trade policy support its industrial strategy?

By diversifying markets and sources of supply

In some cases the EU depends too much on one region or country for certain exports or imports. By allowing European companies to export and import from more markets at better conditions we are limiting our dependency from one or two suppliers and reducing our political and economic risk exposure. Diversification of markets and supply chains can also help sharing the benefits of globalised trade more equally among more of the EU’s trading partners. But for this to happen we need to maintain an ambitious trade negotiation agenda. Chile is a good example as we are revising our existing trade agreement and trying to include more ambitious provisions on access to raw materials.

By increasing our global competitiveness

The EU industry is undergoing a fundamental transformation to achieve the objectives of the Green Deal. In this process we should retain our global competitiveness and the EU’s trade policy can help increasing climate ambition of our trading partners. This can be done at unilateral, bilateral and multilateral levels through multiple initiatives. For instance, through liberalisation of trade in environmental goods and services but also through stronger commitments from our trading partners in the area of climate or biodiversity as a condition for improved access to the EU market in our trade agreements or our generalised system of preferences. Regulatory cooperation and international standard setting are also key to boost the EU’s global competitiveness. In new technological areas international rules are non-existing or under-developed. The EU must take leadership and also look for ways to cooperate with like-minded trading partners. The Trade and Technology Council being proposed to the USA is a good EU initiative in this important area.

By addressing market distortions

There are several EU initiatives in the making aimed at addressing market distortions and promoting a more equitable and competitively neutral environment for our companies in the internal market and globally. The classic trade defence instruments are important but they don’t address many of today’s problems like unbalanced access in public procurement markets or the distortions created by foreign subsidies in the EU market. EU initiatives like the International Procurement Instrument or the Instrument on Foreign Subsidies are therefore needed. But it is also critical to have multilateral rules to discipline industrial subsidies, the role of state-owned enterprises (SOEs) or forced technology transfers.

These are just few examples of how trade policy can work in tandem with the EU’s industrial strategy and support a more conducive environment for our companies in Europe and abroad.

Contact: Luisa Santos

Updated industrial strategy must ensure conditions for growth

“To truly support European industry and companies, the EU should focus on five pillars when implementing its updated industrial strategy: avoid putting disproportionate extra burden on companies’ shoulders; keep the EU open to trade and investment; secure industrial competitiveness in the ‘Fit-for-55’ package; reinforce the single market and ensure that EU standards, crucial for the success in digital and green transitions, are driven by stakeholders; and improve state aid rules for Important Projects of Common European Interest (IPCEI), key to encourage public and private investment”. This was the core message of BusinessEurope’s Deputy Director General Alexandre Affre during a hearing organised by the European Economic and Social Committee (EESC) on 7 June and featuring the participation, among others, of the European Commission, the Portuguese EU Presidency and several representatives of the civil society. The aim of the hearing was to debate and exchange views on industrial recovery, Europe's competitiveness on the global stage, and the transition to a green and digital economy with the rapporteur and the co-rapporteur of the forthcoming EESC Opinion on the updated industrial strategy.

Contact: Daniele Olivieri

Boosting job creation and employment participation: the key drivers for employment recovery

To achieve a quick employment recovery, the main priority is to create the conditions for employers to create jobs. This has to do with the tax wedge on labour, which needs to remain at a reasonable level at all times and reduced where needed. This also has to do with introduction of well-designed hiring incentives for employers to be encouraged to hire workers in still fragile post pandemic times. In parallel, EU and national policies need to encourage jobseekers’ and workers’ employability and adaptability. A particular focus group is the high number of inactive people in our societies, who need tailored support to get closer to the labour market, develop their skills and be encouraged to return to work. Increasing their labour market participation will be of crucial importance for sustaining social protection systems. Because their productivity or work capacity may at the start be limited, well-designed in-work benefits, together with more effective activation policies, are key measures to consider in order to support higher employment participation by workers. Improved job-to-job transitions also have a key role to ensure a better match between jobs and skills across sectors. Returning to voluntary telework practices, in agreement between employers and workers, is also part of the main labour market challenges post Covid. These were the key messages passed by Maxime Cerutti, BusinessEurope Social Affairs Director, on 3 June during the World Pensions Alliance Transatlantic Conference in the panel “How are labour markets transforming in response to the Covid Pandemic?”.

Contact: Anna Kwiatkiewicz-Mory

BusinessEurope supports multi-industry statement on Chinese data legislation

On 2 June 2021, a group of 32 business organisations from around the world submitted a multi-industry statement voicing concerns in relation to the Chinese draft Data Security Law and the draft Personal Information Protection Law to the Chinese government. Besides BusinessEurope, signatories include the European Services Forum, the U.S. Chamber of Commerce, BSA-The Software Alliance, Digital Europe, and the European Automobile Manufacturers’ Association. The key areas of concern raised in the statement are, amongst others, data localisation requirements and highly restrictive data transfer provisions for personal information, proposed data transfer “standard contracts” that may not be interoperable with standard contractual clauses under the EU General Data Protection Regulation as well as the absence of other internationally recognised data transfer mechanisms, such as intra-corporate binding rules, trustmarks and regional certifications. The signatories respectfully inquire whether alternative, less restrictive approaches may exist to achieve the personal data protection and data governance objectives underlying proposed legislation. A copy of the statement can be downloaded at this link.

Contact: Benedikt Wiedenhofer

Intellectual Property Offices strengthen support to SMEs

The Management Board of the European Union Intellectual Property Office (EUIPO) met virtually on 2-3 June 2021. Among various topics, the EUIPO reported on the implementation of the SME Fund 2021, created together with the European Commission, with the support of the intellectual property offices of the Member States. The SME Fund was first launched in 2020 and is intended to help small businesses which wish to develop their intellectual property (IP) strategies and protect their IP rights, at national, regional or EU level. The Management Board also discussed some proposals for future initiatives for SMEs in 2022. In this context, they approved the extension of the original Working Group of the ECP6 European Cooperation Project (BusinessEurope is a member of this working group). BusinessEurope, represented at the meeting by Elena Bertolotto, Legal Advisor for Intellectual Property, welcomed the EUIPO efforts to support European SMEs to better access and deploy intellectual property tools and the proposals to include further support activities under the SME Fund 2021.