Focus
The European Commission has launched the “Competitiveness Compass,” a strategic initiative to boost Europe’s global competitiveness through innovation, decarbonization, and security, with a focus on creating a more dynamic economy and achieving climate neutrality. The Commission is seeking to simplify and streamline its laws, weigh costs and benefits of new rules.
Summary
The European Commission has launched its “Competitiveness Compass,” a new strategic framework designed to help Europe regain its global competitiveness while leading the charge towards climate neutrality.
President Ursula von der Leyen emphasized the urgency of the plan, stating, “Europe has everything it needs to succeed in the race to the top. But, at the same time, we must fix our weaknesses to regain competitiveness.” The initiative seeks to address Europe’s productivity gap, focusing on innovation, energy transition, and security to secure long-term economic growth.
Europe has everything it needs to succeed in the race to the top. But, at the same time, we must fix our weaknesses to regain competitiveness. The Competitiveness Compass transforms the excellent recommendations of the Draghi report into a roadmap. So now we have a plan. We have the political will. What matters is speed and unity. The world is not waiting for us. All Member States agree on this. So, let’s turn this consensus into action.
Ursula von der Leyen, President of the European Commission
The Compass outlines three core action areas: innovation, decarbonization, and security. Innovation is a key priority, with the Commission aiming to close the innovation gap by fostering start-ups and promoting industrial leadership in emerging technologies. As part of this effort, the Commission will introduce initiatives like ‘AI Gigafactories’ and action plans for biotech, robotics, and quantum technologies. Additionally, the Compass will propose a 28th legal regime to simplify rules and foster growth for innovative companies across Europe.
With the Compass, the Commission presents its economic doctrine for the next five years. This doctrine is simple and can be summed up in one key word: competitiveness. Competitiveness in every euro that we will spend, and in every initiative we will propose. From this ambition comes a threefold work program: simplify, invest, and accelerate on our economic priorities. The compass must signal a change of mindset for Europe and Europeans. It makes Europe more predictable, while maintaining the course of our European model – decarbonised, social and respectful of our values.
Stéphane Séjourné, Executive Vice-President for Prosperity and Industrial Strategy
On decarbonization, the Compass emphasizes the need for affordable clean energy. The upcoming Clean Industrial Deal will focus on making Europe an attractive location for clean manufacturing and energy-intensive industries.
An Affordable Energy Action Plan will work to reduce energy prices, while an Industrial Decarbonisation Accelerator Act aims to streamline permitting for sectors undergoing transition. “The world will need to produce hundreds of millions of tonnes of biochar for carbon sequestration in order to have a climate-relevant impact,” said Madhur Jain, CEO of Varaha, underscoring the importance of decarbonization in global competitiveness.
Finally, the Compass aims to reduce Europe’s excessive dependencies on external resources, strengthening supply chains through global partnerships. With a review of public procurement rules, the Commission plans to introduce European preferences for critical sectors and technologies.
The five horizontal enablers, including simplification of regulations and improved coordination between EU and national policies, will ensure that these goals are met efficiently. The initiative marks a major step towards Europe’s future-proof economic strategy, with von der Leyen concluding, “What matters is speed and unity. The world is not waiting for us.”
