European Business Summit 2013: Where Business and Politics shape the future

The time of the year for possibly the biggest and more prestigious event in Brussels came and the European Sting was present to cover it. Last Wednesday the 15^th and Thursday the 16^th of May the top European leaders gathered at Autoworld, only a breath’s distance from Berlaymont where the headquarters of the European Commission are based. The theme of this year’s 11^th edition of the European Business Summit (EBS) was: “Unlocking Industrial Opportunities – An EU Strategy for Competitiveness”. The scope of the numerous sessions and debates during the event was, as the organizers, BUSINESSEUROPE and Federation of Enterprises in Belgium (FEB), state, the “reindustrialization of Europe and the promotion of innovation in the European Union”. And, indeed, this is a very big bet for the European Economy today, the restoration of its competitiveness. Particularly in times of escalating European recession where European citizens suffer now due to the mistakes of the past, that is the violently rapid expansion of the Monetary Union, and the mistakes of the present, that is the monolithic emphasis on fiscal consolidation and austerity. At the same time the rest of the world’s big economies seem to have overcome their problems and they are back on the track of growth. Hence, it is clear that the challenge for the EBS this year was greater than any other year before. The Sting followed closely the talks of the European business leaders at the Autoworld with much interest: Mr Thumann emphasized on the importance of European Business for the future of Europe. He stressed on the need for growth, and particularly he claimed that European businessmen and politicians should work closely and constructively together to attain the EU’s 2020 business growth goal, that is 20% increase of the European GDP. Moreover, he expressed his great support on the implementation of more FTAs of the EU with global economic powers. He mentioned that the focus on this matter should be on the FTA with the USA, Japan and Canada and he did not omit to say that that there should be no sectors excluded from those FTAs. In addition, Mr Thumann also cited the need for environmentally friendly technologies in Europe while at the same time he indicated that unnecessary environmental obstacles to European Businesses should be removed. The President of BUSINESSEUROPE touched European social issues as well, such as education. Stressing on the necessity for educated Europeans, one of his repeated motos was “Education, Education, Education”. He suggested that there should be an intensification of the implementation of educational programmes so that the “lost generation”, as he called the unemployed youth of the South of Europe during his closing speech, becomes more competitive in the job market. Other topics he referred to were the necessity for growth in raw material in Europe and the need for easier access to credit. Ending his speech he expressed his deep belief that the crisis will be overcome through fiscal consolidation while at the same time he did not hesitate to state that the exit from the crisis will take time. We would like to end the coverage of the President’s of BUSINESSEUROPE statements by quoting two of his phrases: a)      “The Future of Europe depends on Business and the future of Business depends on Europe” b)      “Dear Mr Barroso, we count on you” When the turn of Mr Van Rompuy came to contribute to this Summit, he initiated his speech in a positive manner by saying that the worst from the crisis is already behind us. However, he agreed with Mr Thumann that it will take time for growth to come back. Later he did not hesitate to refer to the numerous vulnerabilities of the EU and he even expressed his wish that all those gaps and structural deficits of the EU were looked at and resolved at an earlier stage. According to Mr Van Rompuy, a successful policy agenda in the EU would include the fight against unemployment, growth caused by injection of new job opportunities in the market, the resolution of core European structural issues, the battle against tax evasion, the easy access to credit, the lift of Business barriers, the focus on the development of opportunities for SMEs and the independence of Europe in energy needs from abroad. Later on the President interestingly expressed his great concern over the crucial issue of the financial fragmentation of Europe. Moreover, he spoke about the real divide between classroom and unemployment in Europe. Last, but not least, he encouraged the European Parliament to reach finally to a decision on the EU Budget as soon as possible. Soon Mr Tajani was invited to talk at the podium. The Italian Commissioner took the time to summarize in a few minutes time his agenda on European Industry and Entrepreneurship. Mr Tajani took the next step in the debate of the European leaders by clearly stating that “sacrifices (austerity) are important in Europe but sacrifices are not the solution of the problem”. We found his remark very constructive at that point since the speakers before him had a rather conservative approach on European crisis. Mr Tajani said during his speech that he is working together with his team on growth reindustrialization, European Research and Development, development of European SMEs, venture capital, key enabling technologies, green cars, development of the steel sector, smart cities, raw material sector, space sector (Gallileo), touristic growth in Europe, visa issues particularly for China, Russia and the USA, development of the European fashion industry, the energy sector, Basel III and the 20% growth target for 2020. The Italian top EU official did not omit to say that in the past European industry was disfavored by policy makers in Europe but now the situation is dramatically changing in favour of business. The Summit was coming to an end last Thursday but everybody stayed foot to wait for the closing speech by Mr Barroso, the President of the European Commission. The President started his speech by underlining the complexity of the European crisis. He appeared in favour of fiscal consolidation but he stressed on the necessity for business growth at the same time. Moreover, Mr Barroso admitted the fact that the public debt in Europe is substantial and that it will continue to grow. What is more, just like Mr Van Rompuy did, the President of the European Commission did not neglect to talk about the big issue of the financial fragmentation in Europe. He went though a step further by claiming the big need for the completion of the European Banking Union. He also said that the role of the ECB is to protect the European economy and that Mr Draghi has the necessary remedies and the ECB is ready to help, if needed. Mr Barroso did not chew his words. He openly and clearly affirmed that austerity per se will not save Europe, but on the top of that we need a more integrated monetary union. Later on, the President, like the other top EU leaders did, talked about the FTAs of the EU with big world economies. He recognized the economic benefits that FTAs can bring to the EU but we need to underline here one word that he used that substantially differentiated his thought from the other EU leaders. Specifically, he said that we need FTAs without being naïve. It is clear that the President is talking here about the trend in Brussels to support FTAs with no limits. He argues here that we need to be careful and estimate all repercussions of an FTA with another country in total and detail. In addition, Mr Barroso, like the other speakers summarized his policy agenda at the European Commission. Particularly, he talked about the capital cost in Europe, the required reforms to restore competitiveness in European business, the rebalancing of the economies, the fighting of unemployment-education is not enough, the unitary patent system, the facilitation of investments in Europe, the internal market for energy, the further development of digital economy, the ICT sector in Europe, the telecom-single market, the affordable energy price, the European investment abroad, his commitment to the no Euro devaluation, and the EU-US FTA. Right after the end of his speech, during the followed panel discussion moderated by Mr Stephen Fidler from Wall Street Journal, he answered to Mr Fidler’s question on the last year of his service as President of the European Commission with a joke from the world of football where his favourite team Benfica lost the UEFA cup in extra time. He said that one year in politics is an eternity, meaning that he and his team have a lot of work to do still. The Question of the Sting to the European Business Leaders Last Thursday we did not omit to directly address the Europeans’ biggest worry during the opening press conference of the event with a panel comprised by Mr Thumann, President of BUSINESSEUROPE, Mark Spelman, Global Managing Director of Accenture, Mr. Timmermans, CEO of FEB/VBO and Mr Beyrer, Director General of BUSINESSEUROPE. Our question was the following: “We all heard yesterday and today about European business growth. However, we all read Eurostat’s announcement yesterday that Europe’s GDP and profit share are declining. How will European business grow in times of austerity where governments spend less and the purchasing power of the European consumer is going down?” The unanimous answer we received by the members of the panel was rather expected. All four European business leaders indicated that the road to business growth passes through fiscal consolidation and structural reforms in the member countries. Our question, however, was in fact how strict fiscal consolidation and austerity, that have impoverished numerous countries and condemned the young generation to deep unprecedented unemployment, are going to be the fertile soil for European business growth. Unfortunately, we did not receive an answer on how in European economies where the purchase power of the citizens is today comparable with developing countries and European governments live to pay their debts business opportunities and growth can be created. Everyone wants “business reindustrialization”, as the organizers cite as the European Business Summit’s theme, that will make our economy competitive again in the world and will create employment for many Europeans. What no European wants, though, is a “business reindustrialization” only for the very few European economies that do well at the time. That would further increase the gap between the North and the South of Europe and would threaten the mere essence of the European idea. EBS 2014 To sum up, the European Business Summit was an excellent event that could potentially contribute in the resolution of the European crisis and the return to competitive business growth. The title of the Press Release of the European Business Summit is very thoughtful and to the point: “Where business and politics shape the future”. Last week indeed European Business met European Politics. Moreover, we believe that most of the problems and their solutions were heard last week, either during the sessions or during the stimulating discussions during the coffee breaks. However, it needs to be understood that in the end of the day it is the European Politics that will decide for European Business and not vice-versa. The reason for this is simple. It is in European politics that the voice of the European citizen is democratically represented and not in European Business. Therefore, for the good of the European democracy the European politicians received an invitation last week by the European Business leaders to sit down and listen to the market’s worries. We hope they truly pay attention to the issues of the industry and take measures in a democratic way that will not put in danger, though, the common good of the European citizen in favour of a possible rapid increase in profit share. This invitation was very successful and we hope that the “European Politics” will also be invited at the EBS next year, as we hope the same will happen with the editorial team of the Sting that is bound to contribute to this democratic dialogue for growth through its independent and original European insights. The Sting’s Team