Philippe de Backer of ALDE at European Business Summit 2015 stresses: “Reinvent your business”

Written by Philippe de Backer, Belgian MEP with ALDE, member of the Committee on Industry, Research and Energy at the European Parliament

Philippe de Backer is a Belgian MEP, member of the Committee on Industry, Research and Energy (EP)

Philippe de Backer is a Belgian MEP, member of the Committee on Industry, Research and Energy (EP)

European industry is in crisis. Production is 10 percent lower since the economic crisis began in Europe and over three million industrial jobs have been lost. Real actions are still missing, despite declarations, reports and recommendations to re-industrialise Europe. The real question is: how can we in Europe cope with global competition and creative destruction and how will the EU and its member states act on the issue to really boost European industrial competitiveness?

“A stronger European industry and integrated and coherent industrial policy are key for growth and jobs in the EU”, the new Commission president Jean-Claude Juncker put forward in its inauguration speech six months ago. Expectations were high, the estimated results low.

There are three main challenges currently facing Europe’s economy: 1) weak economic growth, 2) globalization and digitalization, 3) megatrends (climate change, population explosion).

But the problems many industrial sectors face today in Europe do not result from the financial or Eurozone crisis. On the contrary, the crisis is the result of too little Europe, a lack of a unilateral energy, climate, digital, capital market and environmental policy which are hurting European industrial competitiveness. The lack of a genuine single market is hurting many industrial sectors in Europe.

On top of that, we see a lack of structural changes in national economies and a delayed response of many Europeans to the information revolution. It is changing Europe from a leader towards a follower. Europe is in the global context no longer an attractive region.

Why does  Europe has no Samsung, Apple, Google or Twitter? The lack of a European response to the rise of ICT and Internet is weakening Europe’s position, because the digital rise and changes are affecting various industrial sectors. Europe is losing the battle for ‘the digital native’ to Asian and American high-tech giants.

Furthermore, the switch to renewable energy that is taking place in many European countries is not being managed in a market-driven and cost-effective way. This deepens Europe’s competitive disadvantage. Europe cannot reverse climate change by itself, or choose an energy policy which isolates it from external shocks such as shale gas revolution.

Overall, Europe’s economy is slightly transforming into a post-industrial service economy. Losing productions to regions outside the EU as China, Brasil or the USA is far from a new phenomenon, because there are more comparative advantages for mass production to be found there.

This does not mean that it is over and out for Europe. On the contrary, we need a new dynamic for Europe.  This does not mean Europe’s national economies don’t have new opportunities. Even of more importance for the European industry is our ‘immaterial capital’ that is driving our industrial production and growth. Research and development, design, creativity, skills,… Why to worry about industrial production when we can have an industrial renaissance based on activities that bring greater value and that we already bring to the table?

The European Commission has estimated that for every hundred jobs created in industry, at least 60, and perhaps 200 new jobs were created in the rest of the economy. This shows that a vital element for renewal is research and innovation. But innovation requires entrepreneurship. Innovation does not simply fall from the sky, nor can it be imposed. It is driven by people, by their commitment, creativity, dedication and motivation to be the best and succeed. Also policy makers need to make changes.

In order to regain economic growth, we need three things.

In the first place, we have to cut the regulatory burden on industrial production. Industry and policymakers need to agree on pro-growth and pro-industry regulations that allow the market-led development of new technologies.

Next to that, we have to develop new products and services. Public investments in R&D need to be supportive towards areas with the highest economic risks and the greatest potential for new products and services. That means ensuring the Horizon 2020-programme stimulating cutting-edge research.

Last but not least we have to attract more investments to Europe. Europe must create a more open regeluation and develop more risk-appetite. In doing so, we can not only stimulate the human capital we have, we can also make sure the human capital stays in Europe and not flees away to the United States.

The industrial renaissance of Europe will not be achieved through old-style industrial policies which tried to create state-led industries through the use of subsidies. Nor will it be assisted by protectionism of any kind. Fundamental change must be embraced and not hindered. On top of that, we must open our eyes to the interconnected world. This is a prerequisite to keeping European industry competitive and its economies prosperous.

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Featured Stings

Half the world’s population is still offline. Here’s why that matters

How can consumers be effectively protected from insurance sellers?

GREXIT final wrap-up: nobody believed Aesop’s boy who cried wolf so many times

Ercom, cutting-edge Telco solutions from Europe

EU budget: Boosting cooperation between tax and customs authorities for a safer and more prosperous EU

The vicious cycle of poverty and exclusion spreads fast engulfing more children

The global economy isn’t working for women. Here’s what world leaders must do

European Confederation of Junior Enterprises hosts in Geneva the Junior Enterprise World Conference

Schaeuble wants IMF out and bailouts ‘a la carte’ with Germany only to gain

Eurozone banks to separate risky activities: Can they stay afloat?

EU Commission closer to imposing anti-dumping duties on Chinese solar panel imports?

Parliament sets up plan to fight the 3,600 criminal rings of EU

Force used against protestors in Gaza ‘wholly disproportionate’ says UN human rights chief

Germany objects to EU Commission’s plan for a Eurozone bank deposits insurance scheme but Berlin could go along

A day in the life of a refugee: the wait

Future EU farm policy: Agriculture MEPs urge fair funding, no renationalisation

Is a full course lunch, a new Commissioner and 2 million anti-TTIP citizens what you would call a “Fresh Start”?

The reason the world showed limited empathy to the Orlando victims

Does the world have strong enough institutions to handle risks like Trump and Brexit?

Economic sentiment and business climate stagnate in miserable euro area

Refugee crisis: Commission proposes a new plan urging EU countries to help Italy

Italian elections: a long political limbo is ahead

EU leads the torn away South Sudan to a new bloody civil war

EU elections: The louder the threats and the doomsaying the heavier the weight of the vote

Artificial Intelligence has a gender problem. Here’s what to do about it

Can Kiev make face to mounting economic problems and social unrest?

Why lay people don’t expect anything good from G20

Why France, Italy and the US press Germany to accept a cheaper euro and pay for Greece

IMF’s Lagarde: Ukraine must fight corruption

Nature is our strongest ally in ensuring global water security

Reflections on the the biggest refugee crisis since World War II

EU security and defence industry prepares positions for ‘producers’ and ‘customers’

We can build a carbon-neutral world by 2050. Here’s how

Tourism offers much to the EU gets a little

EU growth in 2015 to be again sluggish; Can the Juncker Commission fight this out?

“As German Chancellor I want to be able to cope with the merger of the real and digital economy”, Angela Merkel from Switzerland; the Sting reports live from World Economic Forum 2015 in Davos

Merry Christmas from Erdogan, Putin, Mogherini and the Polish firefighter

Politics needs to “Youth UP” in order the ensure the future of our democracies

TTIP is not dead as of yet, the 15th round of negotiations in New York shouts

Benjamin Franklin was wrong: Amazon can tax evade

The EU lets the bankers go on rigging the benchmarks

Everyone has ‘a moral imperative’ to uphold the rights of persons with disabilities, says UN chief

A Brussels antithesis reveals where the EU is heading

The opportunity of studying Medicine abroad

Professional practices of primary health care for Brazilian health and gender inequality

Mining the deep seabed will harm biodiversity. We need to talk about it

The US may be “open” to reviving TTIP, while the EU designs the future of trade with China

At last a solid base for the European Banking Union

IMF: The global economy keeps growing except Eurozone

EU Trust Fund for Africa: Can it be beneficial for Italy and tackle the migration crisis in the Mediterranean?

The cuts on 2014 Budget will divide deeply the EU

Income inequality threatens the socio-political structures in developed countries

The US banks drive the developing world to a catastrophe

GSMA announces speakers for Mobile 360 Series-West Africa

Greece at the mercy of ECB while sailing through uncharted waters

Further reforms needed for a stronger and more integrated Europe

France pushes UK to stay and Germany to pay

Lack of investment and ambition means Youth Guarantee not reaching potential

Capital markets selloff: The financial moguls send messages to monetary authorities

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s