EU employers call for action to boost competitiveness in the EU and deliver on the Single Market

6 September 2023 - The Employers' Group of the European Economic and Social Committee urged EU policymakers to put competitiveness at the centre of the EU agenda and deliver an overarching Competitiveness Agenda.

"In a world shaped by constant transformation […] Europe’s competitiveness must be front and centre in the spotlight, now and in the next institutional cycle," Stefano Mallia, President of the Employers' Group said during the Group's annual flagship event titled Leading the way: A Competitiveness Agenda for a Stronger Europe.

Stressing that old certainties are no longer valid in the face of climate change and AI, Mallia insisted that there is no space for complacency.   

"EU businesses are burdened by significant administrative obstacles that hinder their ability to invest and effectively undergo the green and digital transition – he added. These obstacles include onerous, unrealistic and overlapping reporting requirements, cumbersome permitting and licensing procedures as well as administrative complexity, lack of clarity in policies and guidelines, and other administrative barriers."

European Commission Executive Vice-President Valdis Dombrovskis reassured participants that the EU executive had heard the call and started moving in that direction, particularly in the wake of the US Inflation Reduction Act. He mentioned the recent proposals of the Green Deal Industrial plan and Net Zero Industry Act, temporary state aid measures and administrative simplification or skills agenda. "It's quite a complex endeavour, but we know that we need to be consistent in keeping competitiveness in mind when we pursue different policies," he said, adding that Europe is lagging behind when it comes to productivity and growth.

Europe's share of the global economy has been declining for quite some time - from 25% in 1990 to 15% in 2020 and in 2050 it is predicted to be less than 10%. Europe is falling behind on eight of ten transversal technologies, putting European companies at a disadvantage.

Speakers at the event, included also business leaders and members of the European Parliament.  

European companies underperform in comparison to their counterparts in other major regions: they are growing more slowly, creating lower returns, and investing less in R&D," reminded Mallia. "We need to critically examine why we continue to lag behind on innovation, when it is innovation that will establish whether we will survive the global storm ahead."

Employers told MEPs, who are about to embark in the last lap of this legislature, that we can still turn the tide.

"We need to overcome the national egotism of some Member States," said Sandra Parthie, Employers' Group member and chair of the EESC Internal Market, Production and Consumption. "Businesses are much more advanced as they seek the comparative advantage across borders. They do not act nationally. The real way to competitiveness is the way of the Single Market, which has not been fully implemented yet," she insisted.

Parthie called on the next European Commission to focus on enforcement of the regulations that are already in place and not before we start adding on new rules and new ideas. "Get us the single market which is indeed the key instrument that will deliver a competitive Europe that can stand up in the world," she ended.

Employers have repeatedly called to focus on three actions:

• Have competitive access to resources: Energy, raw materials, labour, capital, and data must be available under competitive conditions for businesses to thrive.
• Have open markets with equal rules: Businesses of all sizes, sectors, and locations need access to markets with a level playing field in the EU and globally.
• Have business-friendly regulation and taxation: This means that we need a policy framework that supports entrepreneurship and innovation, investment, and trade to once again make Europe the number one location for investment.

Professor Dr. Michael Hüther from the German Economic Institute (IW) called for a Delors 2.0 plan. The idea is that demanding "more Europe" as a response to crises is not enough to achieve real change that, as in the spirit of the Delors Plan of 1989, realises a new vision of Europe. "Before investments can show their full impact at the European level and further political integration can be considered, requirements must be met in order to make Europe more attractive as a location for investment and to stimulate private and public investments," he said, hinting at the fact that Brussels is recognizing the pressure to act. "However, this does not ensure the EU's resilience in the Global Power Competition."

EU Employers warned policymakers that they will not lower the guard. "As business leaders, it falls upon us to play an active role in shaping this path. Our role is pivotal in providing businesses with the necessary conditions to function as engines for growth and prosperity," ended Mallia.

Find the full speech of President Mallia here.

For more information, please contact:
Daniela Vincenti, Communication Adviser
daniela.vincenti@eesc.europa.eu
+32 497 412095