EU economics chief says the region needs a 'more assertive' industrial policy and competitiveness

Well, I think that Mario Draghi has a point in stressing the fact that some of our policies were designed 20-30 years ago and in the last years the world has changed. There is another way to say the same thing, which is that the EU cannot be the only herbivores in the world of carnivores, meaning that competitiveness in the last couple of decades was mostly an internal EU story. So you had competition rules, you were to guarantee level playing field for all European member states. You were not fundamentally addressing the issues of international competitiveness. Why? Because trade was going very well, extraordinary well for the EU, but now several thing has changed. So we need a more assertive industrial policy and European competitiveness. This is the reason why I think the radical change Mario is asking is gradually happening. But it is extremely necessary. It’s one thing to push forward with more integration in Europe, to spend more fiscally on developing industries of the future. But if goods are coming through from the border, from China, and these are cheap, high tech goods, then it undermines the story, doesn’t it? So is there a role for greater protection at the border in this phase? Well, this is the the narrow path of the future. How can we increase our competitiveness without falling in a perspective of protectionism, because protectionism is particularly bad for Europe. Having said that, we have to increase our competitiveness. We should never forget the fact that openness to trade remain one of the main assets for the European Union. So we have to keep what we call globalization, make it more secure, but without protections. It’s a narrow path, but I think we’ll be able to address it. I want to bring up a report that’s also coming up this week from Enrique Letta, the former Italian Prime Minister. He’s been assessing the state of the market and pointing out that economic security is in a tenuous position, in particular looking at market share in Europe that has been declining. He’s called the integration and financial energy Telecommunications. But we know, at least when it comes to telecommunications, regulators have stood in the way of consolidation for years and stood in the way of achieving high prices, concerned about the consumer. Do regulators need to take a lighter touch in Europe? Yes, in my view, because of course the the single market is one of the enormous achievement you have there 450 million people, maybe the richest market in the world. But at the same time it is an an unaccomplished single market in some sectors. And I think that this report from Ricoletta is addressing exactly some of the sectors where in fact we don’t have a single market. If we have to, how many telecom companies can we have in Europe 15/20/25? How are we competing in this way with other big economic players in the world? So again, this is the same point I was addressing before we have, we had a mostly inward looking competitiveness approach. Now this approach should gradually become more and more external looking. We need to be not only the paradise of competitiveness inside the EU, but we need to be competitive outside, and for this reason we need consolidation in several sectors and we need the capital markets union.