The pandemic crisis is a great opportunity to rethink the modernisation of the European economy, considering the current speed and intersection of trends in the medium and long term with strong impact on our daily lives. In this process, many questions remain: will we continue to lead the environmental agenda? Will we be able to impose European values and principles when developing new technologies? How can we balance our external openness with new strategic autonomy issues? Will we be able to increase the resilience and competitiveness of the European economy? It will not be an easy process and it does require a joint effort by the many public and private stakeholders involved.
Transition to a low-carbon economy must be at the heart of modernisation policies and sustainability of our societies should not be seen as a sacrifice, but rather as a matter of choosing the type of community we want to live in. Europe leads the sustainable development agenda, establishes global climate pacts and has 10 of the 20 companies with the highest level of market capitalization according to the “New Energy Global Innovation Index”. This environmental transformation must be led by those in the field, by companies when deciding their strategic investments or by financial entities able to catapult new green projects.
In contrast to the environmental area, Europe is clearly lagging behind in the digital area compared to major world powers. We are currently witnessing a technological bipolarisation, with the USA and China waging a “digital cold war” and disputing those who invests more in Artificial Intelligence, 5G as a central technological infrastructure or even in the area of quantum computing. Nowadays, those who control technological means have the ability to progressively influence other stakeholders in the economic, social and political sphere. Thus, it’s inconceivable that only 4% of global data are stored in the EU, only 25% of large companies and 10% of SMC use data analysis as a strategy to improve their business and data scientists only make up 1% of the total number of jobs in most European countries.
We have to acknowledge the fact that Europe lags behind and, in order to increase the competitiveness of its economy and global leadership, it’s essential to join efforts and invest in European projects of common interest in strategic future-oriented sectors such as own production of batteries or microchips. We must therefore be as ambitious again as we were when developing the European satellite navigation system “Galileo” or the project to create the “Airbus”. At the same time, Europe shall leverage the embryo project of the European Innovation Institute (EIC) developed and launched by the former European Commissioner, Carlos Moedas, establishing a new cutting-edge innovation agency like DARPA in the United States. Finally, no other continent will be able to benefit that much from the intersection between industry and technology and, consequently, from the use of industrial data, so therefore it is urgent to leverage the adoption of new technologies by industrial and manufacturing companies. The combination of these three initiatives can catapult Europe to a new global competitive advantage.
In addition to the ecological and digital transformation, the European economy must also reflect on its resilience in the face of crises considering that the modernisation of its industry and technological base depends, to a large extent, on reliable access to foreign raw materials and technological components. Staying true to its longstanding commitment to market opening, free competition and international trade, Europe must also acknowledge and better understand the new dependencies and vulnerabilities that go hand in hand with economic, social and technological progress. In fact, high levels of dependence in these areas lead to risk as regards the supply of essential raw materials as it became clear during the pandemic crisis. Hence, it’s important to adopt corrective measures aimed at increasing its strategic autonomy, defending European values, but also promoting its interests in geopolitical terms.
In the next seven years (2021-2027), Europe shall rely on a multi-annual budget of approximately €2 billion to be invested in a new generation of public policies. Only with the strong involvement of public and private stakeholders will it be possible to benefit from this budgetary capacity and speed-up the transformation of the European economy, rapidly advancing in the environmental, digital transition and increasing strategic autonomy. As Winston Churchill once said, “never waste a good crisis”.

luis.viegas-cardoso@ec.europa.eu