The European Commission has recently published an extensive report entitled The breakdown of European competitiveness: analysis and recommendations, which analyzes the sectoral and horizontal policies that influence the competitive position of the European Union (EU) in the global economy. This report, published in September 2024, identifies challenges and proposes solutions focused on improving the efficiency, sustainability and resilience of key sectors.

Energy and critical raw materials: The EU faces significant disadvantages in terms of energy prices and volatility compared to other regions. With gas and electricity prices significantly higher, the report highlights the need to reduce reliance on short-term markets and promote long-term contracts with reliable suppliers. The high cost of energy in Europe, compared to other regions such as the USA or China, negatively affects industrial competitiveness. The energy crisis resulting from the war in Ukraine has intensified this problem.

Digitalisation and advanced technologies: to strengthen competitiveness, the report emphasizes digitalisation and the improvement of capabilities in artificial intelligence (AI) and semiconductors. The Commission sets out objectives to boost digital infrastructure, such as high-speed broadband networks, key to the development of the European digital ecosystem.

Green transition and clean technology: The paper highlights the role of clean technologies in the energy transition, stressing the need to invest in renewables, as well as technologies such as carbon capture and storage (CCUS) and energies such as small-scale nuclear (SMRs) to improve security of supply.

Energy-intensive industries: Industries that rely heavily on energy, such as steel and paper, are heavily impacted by high energy costs. Proposals for improvement include investments in energy efficiency and the development of power purchase agreements (PPAs) to stabilize energy costs.

Automotive and mobility: In the field of automotive, the European Commission promotes support for the transition to electric vehicles and the establishment of a robust supply chain in essential raw materials such as batteries and semiconductors, as well as the improvement of charging infrastructures.

The report offers recommendations with two main objectives: reducing the cost of energy for end users and accelerating decarbonisation. This includes a commitment to renewable energies, technological innovation and a review of governance to facilitate investments. It also proposes better coordination in infrastructure management and the optimisation of the European energy market to stabilise prices.

The implementation of the proposed measures could foster more sustainable competitiveness, reduce the EU's energy dependence and promote European leadership in strategic sectors. The Commission hopes that these actions will prepare Europe to face future energy crises with greater resilience and price stability.

The EU faces major challenges in an increasingly interconnected and competitive world, but it also has opportunities to strengthen its global competitiveness if it adopts a coherent and coordinated strategy.

Investment capacity, support for SMEs, energy transition and digitalization will be essential to position Europe as a leader in sustainability, innovation and technology.

This report is an essential strategic guide for companies and organizations such as those that form part of the MAV Cluster that seek to maintain and improve competitiveness in a context of global change. You can download it here.