Employers’ group issues recommendations on de-carbonisation and digitalisation in the context of globalisation

The Employers’ Group of the European Economic and Social Committee held a webinar on ‘De-carbonisation and digitalisation in the context of globalisation’, in the frame of the German EU Presidency on 9 December 2020 and produced a set of recommendations for the policy debate.

The triple challenge of de-carbonisation, digitalisation and globalisation is seen as a herculean task, but companies are ready to take up the challenge.

As Europe embarks on its ambitious green and digital transitions, it is essential that it does so with the right strategies and means to maintaining and improving the EU's competitiveness in place.

De-carbonisation and digitalisation are two mutually reinforcing and intertwined processes that represent an unparalleled opportunity to move out of the fragility of the COVID-19 crisis and – strengthen the position of the EU in key strategic value chains while preserving the benefits of an open economy.

Achieving climate neutrality and digital leadership will not be an easy task for Europe. Decarbonising the industry will burden energy intensive companies (steel, cement, chemical sectors) with high-energy costs while simultaneously imposing a massive structural change on the industrial, transport and energy sectors, risking an economic disadvantage in a competitive global market.

In transiting towards a decarbonised and digital economy, we need to embark on a model that results in a thriving economy. If we want the EU to be a frontrunner and be emulated by the rest of the world, we should aim at shaping the most successful business model – one that is sustainable from an economic, social and environmental viewpoint. Adopting a model which does not lead to sustainable growth, would only isolate us in the international area, paving the way for China and the US to take leadership.

The EESC Employers’ Group issued the following recommendations to EU decision-makers:

  1. The twin transition must be balanced in order to strengthen long-term resilience and create new sustainable business models. It is essential that the EU finds the right equilibrium between the Green Deal, the Recovery fund and investing in future-oriented technology and digitalisation. The planned update of the EU industrial strategy should reflect the interlinkages between decarbonisation and digitalisation in a global context.
  2. To preserve competitiveness, we need a comprehensive energy turnaround, providing security of supply for businesses and households, without pushing up prices, while increasing both network connectivity and storage capacity. Hydrogen will play a key role in this process. Relevant applications need to be developed as a priority.
  3. We must develop new models of cooperation and industrial alliances to ‘future-proof’ our economies and re-shape production processes through concerted efforts between businesses, Member States, regions and EU institutions.
  4. Europe has a strong industrial network and its companies have developed dense supply and value chains. They must be supported and strengthened via improved cross-border infrastructure and the completion of the single market.
  5. Investment capacity and support for companies are needed as they roll out on sustainability models so that they can remain competitive and access new markets. The EU Recovery Package will provide comprehensive public financial support, which must be aligned with private funding to achieve the objectives of digital and green economic transformation.
  6. Companies rely on clear regulatory frameworks, also for data and new technologies. Uncertainty of companies on how to use their data, partly because of an unclear scope of data protection regulation is a hindrance for innovation. 
  7. The world is currently in the process of moving from trade wars to techno-political wars.  It is thus imperative that the EU becomes autonomous in the development of a European data infrastructure and new digital technologies. Between China and the United States, the EU must stand on its own and invest in the technology of the next generation.
  8. The EU has to develop its own vision and strategy for digital sovereignty, while remaining open to free trade and supporting the multilateral system. Strategically is should focus on getting its infrastructure, cybersecurity, cloud, key enabling technology and data in place and convince global partners through the quality of its standards and products.
  9. SMEs are the backbone of the EU’s sustainable economic growth agenda. Improving their connectivity and digitalisation infrastructure, including skills, AI and the use of new technologies will be crucial. And no one must be left behind, i.e. there must be no gap between larger firms that have the resources to invest in and adopt digital technologies and the smaller firms that don’t have their own means to do this.