EU Leaders react to fear instead of showing strategic vision

Letta’s report contains many positive elements, such as the need for the fair green transition as a strategic priority, the need for additional investments and a circular economy, among others, but unfortunately, EU Heads of States missed the opportunity to align their discussions with a sustainable and forward-thinking agenda firmly rooted in the European Green Deal. Instead their narrative falls back on simplistic and false solutions such as putting new EU laws on pause.

“Today's conclusions on competitiveness make painfully clear how rudderless EU leaders are. Without clear political priorities, discussions on competitiveness risk catering to the short-term interests of those industries who lobby leaders the hardest, without genuinely future-proofing our Union.  The fair green transition must be made a top political priority - as was rightfully highlighted in Letta's report on the future of the Single Market - in the discussions on the Strategic Agenda, where urgent action towards a climate neutral and nature positive economy are shamefully being overlooked,” said Tycho Vandermaesen, Policy & Strategy Director, WWF European Policy Office.

A Competitiveness Deal: lacking a strategic vision for industry’s future?

As part of the negotiations on the future EU priorities, EU leaders deliberated on a new European competitiveness deal intended to “create a robust and future-proof economy”. As outlined in Letta’s report, reshaping the single market  could enable the European industrial capacity to be compatible with the goal of the fair and green transition. Speeding up the green transition will ensure Europe’s competitiveness, not undermine it, by maintaining the EU’s global leadership on key green technologies.

Although the conclusions recognise the need for a climate-neutral and circular economy, EU leaders lacked imagination for concrete actions, overlooking the different components of competitiveness by mainly focusing on cutting red tape and administrative burdens. 

“Any Competitiveness deal must be fully aligned with the European Green Deal. Competitiveness is not about cutting red tape. It’s about designing good public policies that enable the EU’s industry to thrive and transform by increasing circularity and demand-side measures, boosting innovation, skills and reskilling. By focusing on deregulation instead, heads of States risk harming innovative companies, citizens and nature”, said Camille Maury, Senior Policy Officer on the Decarbonisation of Industry at WWF European Policy Office.

With climate change as one of the biggest threats to our economy, the imperative for industrial decarbonisation is clear. WWF therefore welcomes the mention of decarbonisation in the conclusions, but regrets the lack of concrete and strong commitments required  by industries to actually decarbonise. As it stands, there is a risk that this deal could merely serve as a concession to industry interests, failing to deliver meaningful climate progress.

“EU leaders must focus their efforts on continuing the implementation of the European Green Deal and building a vision for the future of EU industries that includes pathways to decarbonise high-emitting industries like steel and cement, while fostering cleantech industries like heat pumps and batteries. The current pioneering of green steel production in Europe is proof that EU regulation can help innovative businesses to thrive here,” concluded Maury.

EU leaders also failed to address the elephant in the room: Who will pick up the bill? Without urgent and large-scale public investment, targeted to the right sectors and including people, as called for by civil society, academics and almost all European political parties, the EU will fail to boost its green sectors, and to rapidly transform its infrastructure for climate neutrality, risking leaving people behind.