European Commission Vice President Antonio Tajani, responsible for industry and entrepreneurship, said: “Europe is still far from the 20% target of industry’s share in Europe’s GDP by 2020. That is why industrial competitiveness has to be at the heart of the March 2014 European Council political agenda. With today's initiative the Commission sends a clear signal that urgent reindustrialisation and modernisation of our economy is indispensable if we are to create new jobs. We need a strong commitment at the EU and national level to ensure coherence and prioritisation of all instruments at our disposal. An industrial strategy must encompass many other sectors, as they are increasingly inter-connected and have a major impact on industrial success.”
The European Commission is urging Member States to recognise the central importance of industry for creating jobs and growth and to mainstream industry-related competitiveness concerns across all policy areas.
This is the key message of the communication For a European Industrial Renaissance, adopted today. The Commission calls on the Council and the Parliament to adopt proposals on energy, transport, space and digital communications networks as well as implement and enforce legislation to complete the internal market. Furthermore industrial modernisation must be pursued by investing in innovation, resource efficiency, new technologies, skills and access to finance, accelerated by the use of dedicated EU funds. The Communication promotes a more business friendly Europe through actions to simplify the legislative framework and improve the efficiency of public administration at EU, national and regional levels. Easier access to third country markets through harmonisation of international standards, open public procurement, patent protection and economic diplomacy are also key issues.
A strong industrial basis is a condition for growth and job
The EU is emerging from its longest-ever recession, that has underlined the importance of a strong industry sector for economic resilience. Industry’s role in Europe extends far beyond manufacturing, ranging from raw materials and energy to business services (e.g. logistics), consumer services (e.g. after-sales services for durable goods) or tourism. Industry accounts for over 80% of Europe’s exports and private research and innovation, underlining that industry´s importance is much greater than suggested by its share of GDP. Almost every fourth private sector job is in industry, often highly skilled, while each additional job in manufacturing creates 0.5-2 jobs in other sectors. However, at 15.1% in the summer of 2013, the contribution of manufacturing to EU GDP has declined further and is a long way from the 20% target for 2020 put forward by the Commission in 2012.
A competitive industry at the top of the European agenda
The importance of the challenges ahead for Europe’s future calls for attention and policy guidance at the highest political level, i.e. the European Council. This is vital to ensure the coherence and prioritisation of all instruments at the EU’s disposal. The European Commission calls on Member States to recognise the central importance of industry for boosting competitiveness and sustainable growth in Europe and for a more systematic mainstreaming of competitiveness concerns across all policy areas.
The Commission considers that the following priorities should be pursued to support the competitiveness of European industry:
• Strengthening mainstreaming of industrial competitiveness in all policy areas, given the importance of the contribution of industry to the overall economic performance of the EU.
•Maximising the potential of the internal market by developing the necessary infrastructures, offering a stable, simplified and predictable regulatory framework favourable for entrepreneurship and innovation, integrating capital markets, improving the possibilities for training and mobility for citizens and completing the internal market for services as a major contributing factor to industrial competitiveness.
•Taking measures in the internal market and at international level to secure access to energy and raw materials at affordable prices that reflect international conditions.
•Deploying and implementing European financing instruments, based on effective combinations of COSME, Horizon 2020, Structural Funds (regional funds at least 100bn EUROs) and national funding to pursue innovation, investment and reindustrialisation.
•Restoring normal lending to the real economy. In this respect, the European Investment Bank should play a more strategic role by targeting more lending to innovation and industrial projects. The EU should address the remaining bottlenecks created by the fragmentation of the financial markets and create the conditions for the development of alternative sources of financing.
•Facilitating the progressive integration of EU firms and of SMEs in particular, in global value chains to increase their competitiveness and ensure access to global markets in more favourable competitive conditions.
Enhancing industrial competitiveness is vital for re-launching growth and employment with the view to reach as much as 20% share of GDP for manufacturing by 2020.