The series of discussions on European competitiveness to compete with the United States and China became less concrete this Friday, with the Budapest declaration. With less ambition than initially planned, EU leaders held a meeting in which there was a sense ofand the urgency of strengthening the competitiveness of the bloc, especially with the return of former Republican President Donald Trump to the White House. However, the different positions between member states are evident on one of the key issues for the future of the EU: the financing of this strategy.
The starting point of the EU leaders’ conversation in Budapest was the report on competitiveness prepared by former Italian Prime Minister Mario Draghi. He estimated the bloc’s financing needs in 800,000 million euros per year and, to this end, it opened the door to a new issuance of joint debt. These were the main messages of the analysis, but this last idea comes up against the rejection of frugal countries: Germany, the Netherlands or Austria.
“The recommendations in this report are already urgent given the economic situation we find ourselves in,” said the former president of the European Central Bank upon his arrival at the informal summit of EU leaders in Budapest. “They became even more urgent after the US elections. “There is no doubt that Trump’s presidency will make a big difference in relations between the United States and Europe,” he added.
The Italian confirmed that the EU must mobilize to reactivate its industrial competitiveness against the United States, because the difference in productivity between the two regions is very large. “Big changes are coming and I think “What Europe cannot do is postpone decisions.”» affirmed Draghi, demonstrating the lethargy of the bloc in favor of a consensus which has not been reached.
“It is clear that no one is interested in managing this decline. Making Europe great again, if the “The Americans have decided to make America great again” Far-right Prime Minister Víktor Orbán explained that he believed there was no other way to outline the guidelines that the European Commission should follow.
The Hungarian also highlighted differences between EU governments on the timetable needed to develop a common strategy. “How much time do we need for the plan to come to fruition? Six months. By July 1, 2025, we will have to report on what we have achieved among the goals set today, which have been achieved and which ones haven’t been. I don’t think we have any more time.“Emmanuel Macron said we had two years, but I think we only have six months.”underlined the Magyar politician.
The leaders’ debate was designed as an ambitious event that would leave behind the lengthy meetings of EU economy and finance ministers and shape the bloc’s competitiveness strategy. The financing formulas are articulated as the great debate and the obstacle to overcome to unite the positions between the Twenty-Seven. The declaration finally speaks of “Enjoy all the instruments” but leave all doors open.
On the table: use multi-annual budgetary resources by diverting items from cohesion and agricultural funds towards competitiveness, advance the dormant capital market union, blocked in part by the refusal of Germany and Luxembourg to a figure of centralized supervision, greater involvement of the European investment sector. Bank, a new joint debt issue, or own resources, such as elements from the CO2 emissions market.
“First of all, we have to talk about projects, not new debts. When we started mutualizing the debt contracted with COVID, we saw that we had to bear an extremely high interest burden together,” he said. he expressed his opposition to more debt. Austrian Chancellor Karl Nehammer. The common message addressed to the future tenant of the White House is a call for strengthening transatlantic relations and dialogue. “If the United States wants to do something about competitiveness with China, we can work together. within the framework of the World Trade Organization,” said outgoing Belgian Prime Minister Alexander De Croo. “I think we are allies, it would be stupid for allies to set tariffs on each other. ”
Brussels’ next steps
The head of the Community executive, Ursula von der Leyen, listed three commitments during a press conference. On the one hand, it established as a priority the adoption of a twenty-eighth “EU-wide, accessible and voluntary regulation” for startups in order to avoid regulatory fragmentation. The second of the commitments to which the German refers. reducing polluting emissions. “In the first 100 days of our mandate, we will propose the Clean Industry Pact. And, finally, diversify supply so as not to depend on a single supplier.
