Industry and Entrepreneurship
Dear Madam, Dear Sir,
As has become my usual practice following last year's initiative, I would like to present you with an overview of the activities carried out in 2011 to support the competitiveness of European industry.
The Communication on the New Industrial Policy was adopted a little over one year ago, but in that time the economic, financial and political framework has drastically changed. Pressed by the crisis and by the markets, the EU has embarked on a difficult path which involves a period of urgent reforms needed to meet the hard challenges we are faced with.
Today more than ever we must go back to the real economy by putting Industry and Small and Medium-sized Enterprises at the top of the political agenda; they are the engine of growth and employment. As was highlighted in the conclusions of the most recent informal European Council, "The 23 million European SMEs are the backbone of Europe's economic success and a key provider of employment".
During 2011 my activities focused on implementing industrial policy, which, with particular emphasis on small and medium-sized enterprises, was fully supported by EU leaders when they made it one of their priorities.
Moreover, the European Semester has acknowledged the central role of the microeconomic pillar, which I have been working for with determination and which has been for too long marginalised in debates and in priority setting. Structural reforms need this microeconomic foundation, constructed of industrial innovation, access to credit, infrastructural projects and resource efficiency.
The Commission is already taking effective action in this direction by promoting a more sustainable welfare state and by eliminating inefficiencies and the excessive administrative burden placed on businesses, with the aim of unleashing precious resources to be allocated to the real priorities: applied research, innovation in key enabling technologies (KETs) and the green economy, with the involvement of the entire value chain.
For this reason, in "Horizon 2020" we allocated 80 billion EUR to applied research and industrial innovation and with the new programme COSME we proposed to double the funds allocated to the competitiveness of SMEs.
GMES and Galileo will further boost innovation. It is estimated that thanks to the services offered by Galileo applications the European economy will grow by 90 billion EUR. This project has gained new impetus thanks to decisive action to reduce costs and accelerate the deployment phase. This was demonstrated by the launch of the first two operational satellites from the ESA base in Kourou (French Guyana) last October. The savings achieved and the Commission's decisive action aimed at increasing competition in the industry enabled us to buy 8 new satellites. These latest contracts were signed on 2 February in London taking to 26 the total number of satellites bought within the current financial perspective.
Innovation is boosted also by the standardisation policy, and I submitted a proposal to revise the European standardisation system last June. As well as opening access to new markets, a strong standardisation policy stimulates innovation, with benefits for consumers and improved efficiency in the use of resources. The same can be said of strategic access to raw materials, which is why we are working on a European strategy to reduce our dependency on other economies rich in resources, through innovation and substitution plans.
I intend to help enterprises take more advantage of the Internal Market. The technical standards monitoring mechanism, established by Directive 98/34/CE, contributes to safeguarding this achievement: out of the 676 notifications received in 2011, the Commission has made observations on 184 notifications on their compatibility with European law.
If the interest rate spread, which has been an obsession over the last few months, measures the trust in our ability to pay back our debts, lending conditions to enterprises send equally worrying signs, but access to credit is essential for a new industrial policy based on innovation.
Since the beginning of my mandate I have promoted a Forum on access to credit for SMEs in an attempt to improve access to capital. In December I presented an ad hoc action plan including a “European passport” for venture capital. I also wrote to all European Ministers for Industry and invited them to accelerate the transposition of the Late PaymentsDirective.
Improving the business environment for SMEs is a top priority. A first initiative was the update of the Small Business Act, which I submitted in February last year, followed, in November, by the first European strategy for the internationalisation of SMEs. I am convinced that economic recovery also depends on the success of our enterprises beyond European borders and European economic diplomacy should play a role in this important initiative, by supporting this process. For this reason in 2011 I was particularly active in Southern Mediterranean and Latin American countries, where for the first time I organised a mission accompanied by 30 European entrepreneurs representing the different sectors under my responsibility.
Last but not least, tourism is a strategic sector that needs to be exploited more to boost growth and employment. This sector has been less hit than others by the crisis and it has continued to guarantee jobs, especially to young people. This new European policy is already well into its implementation phase and by the end of this year I will submit a legislative proposal concerning the European Tourism Quality Label (ETQ).
Besides taking stock of what was done over the last 12 months, this letter gives me the opportunity of reaffirming my commitment to lead and accelerate the transition towards a "third industrial revolution", in which Europe must take the lead.
Our challenge is to start growing again and create quality jobs. This is the only way to preserve our model of a social market economy of which Europe must be proud.
To do so, Europe must meet the global challenge by providing itself with a competitive, innovative and sustainable manufacturing sector and by enhancing its know-how and the high quality of its products.
The European Parliament, together with the Commission, has a central role to play to guarantee that the pressing social challenges, such as youth and ageing, security and immigration, shortage of resources and sustainability, which require concrete responses and innovative solutions by European industry, are always taken into consideration.
On this basis I intend to continue working with you over the coming months, listening to your comments, suggestions and proposals.
Vice-President of the European Commission