EU leaders approve 'new competition deal' but avoid common debt!
The 27 leaders of the European Union have approved a long-awaited "New European Competition Agreement" to shake up the bloc's stagnant economy and bridge the growing gap with the United States and China.
The document was sealed on Friday during an informal summit in Budapest that brought fears of de-industrialization and irreversible decline that have come to dominate political conversation in the wake of successive crises, a bleak landscape that may soon darken. if Donald Trump makes good on his threat to impose punitive tariffs.
The solutions outlined in the agreement include pledges to deepen the single market, unlock new money for SMEs and start-ups, cut red tape, promote high-tech domestically, reach "sustainable" trade deals and spend at least 3% of GDP in Research and Development by the end of the decade.
These overarching goals, which will take years to translate into tangible policies, should not come at the expense of the Green Deal, as some right-wing forces have suggested. In their joint statement, the leaders reaffirm their commitment to achieving climate neutrality by 2050 and removing fossil fuels from the bloc's energy mix.
The deal is a direct response to the landmark report by Mario Draghi, the former Italian prime minister, which argued that the EU will face a "slow agony" unless it takes decisive, ambitious action to boost its productivity and modernize its base. its industrial. There was, however, one crucial, attractive recommendation from Draghi that did not make it into the final document: joint debt.
The Italian has estimated that the EU will have to invest up to 800 billion euros in additional investments per year to remain competitive on the increasingly tough global stage. The amount is so large, he said, that the bloc will have no choice but to issue joint debt on a large scale as it did during the COVID-19 pandemic.
Draghi, who attended Friday's summit, said the issue of joint borrowing was not necessarily the "first thing" the EU needs to address, but underlined that it remains "necessary" and urged member states to stop their procrastination.
Despite Draghi's plea, the leaders were not moved. The entrenched opposition expressed by Germany and the Netherlands, which rejected Draghi's recommendation just hours after his report was first published in September, made it impossible to include a clear reference to joint debt in the "deal new competition".
Instead, in the small section devoted to financing, leaders commit to making the most of existing tools at their disposal, such as the EU's multiannual budget, the European Investment Bank (EIB) and a long-stalled project to create a capital market. Union, while exploring the "development of new instruments". What these "new instruments" might look like is up to each reader to interpret as the leaders do not provide further details to guess their significance.
Speaking to the press at the end of the summit, European Council President Charles Michel admitted that talking about "financial solidarity" was "always difficult" for EU countries, but agreeing on contentious issues was still possible. , as evidenced by the heated discussion that preceded the €750 billion recovery fund for 2020.
This financial solidarity, he said, must be accompanied by "structural reforms" to guarantee "more trust" between capitals and to be successful. Ursula von der Leyen, who will begin a new five-year term as European Commission president and tasked with making the "new competition deal" a reality on the ground, said public and private investment must come together.
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