The industrial policy that the EU should pursue

The EU has an important role to play in enhancing the conditions for industry. The four Nordic business organizations’ joint appeal for the EU decision makers was published in Financial Times March 10th, 2020.

European business has a crucial role in delivering prosperity to European citizens and delivering on the big societal challenges that Europe is facing such as climate change. European manufacturing industries are a backbone of the European economy, and services are becoming increasingly important, not only on its own standing but also within manufacturing processes. With digitisation increasing, industry is a driving force. We are at the dawn of the impact of 5G, AI and the “internet of things”.

Alongside important national initiatives within areas like R&D, the EU has an important role to play in enhancing the conditions for industry. To strengthen the competitiveness of Europe’s companies, five areas should be prioritised:

1. There are still barriers on the Single Market for companies to take full advantage of all the opportunities it offers. Accelerate work on European and international standards, eliminate national rules and strengthen supervision on Member States application of Single market rules.
2. EU competition rules promote globally competing companies, low prices and more choice for customers. The European Commission has announced that it will review parts of the acquis. Our message is clear – neither business nor consumers in Europe will benefit in the long term by a more politicised competition supervision.
3. The EU should strive for clear and predictable common rules in international trade. WTO reform and new free trade agreements with individual countries should be given top priority.
4. Research should have priority in the EU budget as a complement to national initiatives. Particular attention should be paid to instruments and infrastructure that promote innovation.
5. The free movement of services within the EU is crucial and needs to be made easier.

Attempts to protect the domestic industry from competition and allow state-aid to support certain selected industry sectors does not necessarily deliver success. It leads to lower growth and high costs for taxpayers without promoting industry in the long run.

In a forthcoming industrial strategy, the EU needs to build upon Europe’s success factors and strengths, rather than trying to turn back the clock.

Jan-Olof Jacke
Director General, the Confederation of Swedish Enterprise

Jyri Häkämies
Director General, Confederation of Finnish Industries

Lars Sandahl Sørensen
Director General, Confederation of Danish Industries

Ole Erik Almlid
Director General, Confederation of Norwegian Enterprise