BusinessEurope priorities for the update of the European industrial strategy

Executive summary

Europe’s future is closely linked to the future of its industry, now more than ever given the profound impact the outbreak of COVID-19 had on already existing internal and external challenges. Despite the EU, member states and industry reacted rapidly to unexpected circumstances and key support measures were taken to alleviate the impact of the pandemic, European spirit was put at severe test.

We welcome the European Commission timely decision to update its industrial strategy. This update should fully acknowledge the impact of COVID-19 on the economy, including the possibility of a delayed recovery, develop around the urgency to restore the business' investment capacity, be based on a comprehensive approach to strengthen innovation and global competitiveness of European business and boost Europe's open strategic autonomy.

An ambitious industrial strategy is the best way to ensure the success of the twin green and digital transitions. The European business supports the goal of reaching climate neutrality by around mid-century, but the EU can only lead as global role model in climate protection if we manage the green transition while maintaining competitive value chains, jobs and companies. The digital transformation of our economies and societies is also a great opportunity, but must be supported by an incentivising investment climate and by developing trusted conditions for the safe deployment and use of new technologies. To fulfil the ambitious medium- and long-term targets of the EU for the green and digital transition and respond to the huge investments need, the level of financing support must be strongly upgraded in the EU. Both transitions must be financed with large investments, necessary to make the transition a reality, from public and private stakeholders, and channel them into the projects of the future.

It is crucial to restore freedoms of movement in the Single Market to pre-COVID conditions as soon as possible, deepen it in all areas, and focus on how the robustness of supply and value chains should be further improved through business-driven diversification. Pursuing an ambitious trade agenda is also of essence for the EU to remain a leading international actor, given the current trade and technological related challenges and assertive strategies pursued by important EU partners. Attention should also be paid to increasing funding for R&D and to the implementation of Important Projects of Common European Interest (IPCEIs), both key to boost our economic strength, competitiveness and resilience.

With its forthcoming update of the European industrial strategy, the European Commission has a golden opportunity to shape the future of our industry and companies and must allow them to fully grasp the opportunities and respond robustly to the challenges brought by a rapidly changing business environment. A solid and clear governance is key to implement an ambitious industrial strategy.

In this position paper BusinessEurope highlights the policy areas which are the most relevant to European industry and companies, and that should be at the core of the update. For each of them, we provide an outline of what is at stake and we propose a set of recommendations.