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EXPERT COMMENT

Stark recommendations in the report risk being thwarted by a European leadership vacuum – and a lacking sense of urgency.

The diagnosis is scathing and the medicine is strong. The report released by Mario Draghi in Brussels on 9 September, ‘The future of European competitiveness’, warns the European Union that it faces lasting sluggish economic growth – which could end up threatening Europeans’ prosperity and social welfare. 

Draghi’s report highlights three ways ‘to reignite growth’: Closing the innovation gap with the US and China in key technologies; seizing opportunities from the ongoing global decarbonization process; and securing supply chains from geopolitical dependencies, that risk turning into vulnerabilities. 

The nearly 400-page document recommends both sectoral (energy, pharma, AI, transport) and horizontal (innovation, skills, governance) policies to ensure the EU remains competitive with the US and China in the future.

The overall strategy requires urgent, massive, concrete, joint efforts by EU countries, including enormous financial commitments. To boost growth and productivity gains, Draghi considers the bloc needs both public and private investments of €750-800 billion (£630-675 billion) per year, that is up to 5 per cent of the EU’s total GDP. As much as €450 billion of this would go toward the energy transition. As a comparison, 1-2 per cent of GDP was spent annually during the Marshall Plan (1948-1951). 

Click here to continue reading the full version of this Expert Comment on the Chatham House website.