Published on October 28th, 2014 | by Paul Rübig | Credit: Workforce0
A Turning Point for Europe’s Competitiveness
It is not politicians who create jobs, but enterprises. This is why we need to create an attractive business environment in Europe, where firms want to invest and expand. Growth should be promoted through structural reforms, more efficient bureaucracy, easing of the tax burden and by pushing an ambitious reindustrialisation strategy. Europe has to be the frontrunner in the most efficient, most innovative and environmentally friendly technologies. We can only achieve this goal with a strong European Union that keeps an eye on the key questions regarding industry and energy on the one hand and climate and environmental policies on the other. (…)
Big challenges ahead of us
Europe represents 7% of the world’s population, 25% of the global GDP and 50% of worldwide social contributions. To keep these standards we need to provide a favourable environment for our companies. Our businesses together with their employees have to work hard in order to maintain our high level of prosperity. However, compared to other big economies such as the US, Europe lags behind in economic growth.
There are various reasons for this situation. Entrepreneurial freedom in Europe is limited by bureaucracy. (…) Moreover, the cost burden for European businesses for wages, taxes, energy and raw materials are alarmingly high and results in enterprises leaving Europe. The price for energy has risen by 3,5% yearly for businesses and 4% for households, which is substantially higher than inflation. Energy prices in the US are up to two thirds lower than in Europe. In addition, Europe is dependent on imports of energy and raw materials: 50% of total energy consumption and 60% of raw materials are imported into the EU, amounting to 700 billion euros every year.
These factors lead to a reduction in productivity in Europe and represent a severe problem for Europe’s competitiveness in our globalised world. We need to invest in research and innovation and in qualifying our citizens for the labour market. To reach economic stability and prosperity, our guiding principle must be “Entrepreneurs need freedom”.
We learnt from the last years that those countries with a strong industry are the most stable ones in times of crisis. The importance of a strong manufacturing basis is now undisputed and influences policy making significantly. As a result, we could convince a lot of decision makers to acknowledge the role of industry as a key priority to make the European economy more competitive and to create high quality jobs for our citizens. We set the goal of raising the share of industry in GDP by 20% till 2020. In order to achieve this goal, the reindustrialisation strategy needs to be integrated into a new legislative proposal. Reindustrialising Europe should be at the centre of Europe’s political agenda. The European Commission suggested simplifying regulations and the administrative environment, hence creating the base for a stable, predictable and sustainable framework for investments in new technologies. (…)
In the field of energy we could reduce our dependency on external resources through a strengthening of the renewable energy supply. The completion of the European internal energy market is a top priority, which includes modernising the energy infrastructure and supporting competition on the energy market. In addition, the EU has set the very ambitious target of reducing CO2 emissions, enhancing energy efficiency and increasing the renewable energy portion of the energy-mix. It is important that the energy prices stay affordable in the medium and long run and that we support the technologies, which promote the use of our own energy resources. (…)
Europe to become the innovation leader
Companies can only be competitive as well as sustainable if they use the latest technologies. That is why the European Parliament has increased the subsidies for research and innovation since January 2014. With 80 billion euros for the next seven years, provided for this purpose within the EU’s framework programme for research and innovation – Horizon 2020 – we want Europe to become a leader in innovation and a truly science and knowledge-based economy. Interactive research, with an active exchange between researchers, enterprises and universities must be a core element for Europe.
What we want for the future
We want to create economic growth and new jobs by investing in research, innovation and education. Only by becoming the frontrunners in new technologies can European companies remain competitive and create high quality jobs for our citizens. We therefore envision a better framework for the economy with less bureaucracy and less administrative burdens for firms. We need to make sure that the highest standards for employees and environment are not undermining Europe’s competitiveness. Industrial and environmental policies should not be designed to work against each other but rather together. Our goals are therefore to strengthen businesses in Europe, to invest in education, research and innovation and to keep energy prices at an affordable level.
This post was originally an article published in issue 2 of UNITEE’s new magazine, The New European, dedicated to analysing the European Dream and the ways to revive it. The complete online version can be read for free here.