Overview: The EU wants to become the ‘land of opportunity’ for strategic technologies
The European Commission considers critical to strengthen Europe’s capacity to manufacture strategic technologies in the continent and to do it in a competitive way to achieve the Union’s geopolitical and environmental objectives. The Net Zero Industry Act, the Critical Raw Materials Act and the Strategic Technologies Platform are but the first regulatory efforts on what is already becoming a new wave of EU initiatives to boost the strategic technologies industry. The recently published communications by the Commission on achieving a 2040 Climate Target and the Communication on Advanced
Key initiatives: An EU New Industrial Plan signals that “competitive” is the new “sustainable”
The Inflation Reduction Act and the ongoing state support provided by the Chinese government to Chinese companies has raised the alarms in the EU where industrial policy has for decades been very limited to prevent fragmentation in the single market. Today the EU is seeking to reinvent its industrial policy to prevent losing businesses and investment opportunities to other regions and even the relocation of its own businesses. The European Commission´s publication of a new Green Deal Industrial Plan raised expectations of Europe’s commitment to the promotion of industrial policy in the continent, one year later the topic remains on top of the EU agenda and is expected to be a cornerstone for the next Commission.
An important angle of the EU´s efforts to reinvent its industrial policy is the continent´s need to reduce its dependency of third powers. This is particularly urgent in critical sectors such as energy, new technologies and defence. The war in Ukraine and the subsequent energy crisis has highlighted Europe’s vulnerabilities to supply chain disruptions in a growingly uncertain international landscape. For these reasons, decreasing the EU’s dependency of other regions with regards to critical resources and components of key technologies have climbed to the top of the agenda. These has lead the EU to be more than ever ready to promote businesses that manufacture strategic technologies in Europe, and more importantly to listen to European businesses and the challenges that face to compete with foreign businesses operating in the continent. The next Commission is expected to be one ready to listen to European businesses, particularly those developing strategic technologies at home.
Consequently, ensuring a competitive economy is considered a necessary condition for the Commission to achieve its recommended 90% reduction of GHG emissions target by 2040. The next Commission will not only be tasked with potentially building the regulatory framework to achieve this target, but also to reconsider how the European Union can strengthen its industry and its competitiveness while implementing the Green Deal.
At the same time, political groups expected to gain power after the European Parliament elections such as EPP, ECR and ID have already signalled their intention to shift the focus of the EU towards lessening the burden on industry and boosting growth instead of protecting the environment. Importantly, these groups share the believe that the green deal has harmed the EU´s competitiveness and weakened its businesses, therefore they consider it is necessary to prioritize competitiveness over sustainable ambition.
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