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Factbox-Europe's plan to regain a competitive edge for industries
Published by Global Banking & Finance Review®
Posted on January 29, 2025
4 min readLast updated: January 27, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on January 29, 2025
4 min readLast updated: January 27, 2026
The EU outlines a plan to boost industrial competitiveness through innovation, decarbonization, and strategic investments, maintaining climate goals.
By Kate Abnett and Philip Blenkinsop
BRUSSELS (Reuters) - The European Commission set out a years-long plan to regain competitiveness in global industries, as European businesses face fierce competition from China and new challenges under U.S. President Donald Trump.
The plan will guide the EU's work for the next five years. It outlines dozens of planned measures and strategies to raise productivity through innovation and to decarbonise European manufacturing.
Here are some of the main ones:
SIMPLIFICATION AND SPEED
The first big tranche of measures, due to be outlined in late February, will focus on simplifying rules for businesses and speeding up investments.
This so-called "Clean Industrial Deal" will include plans to help energy-intensive industries decarbonise and boost production of clean technology.
One of the EU acts - due in the fourth quarter of the year - will offer fast-tracked permits to energy-intensive industries to help boost investment in clean industrial projects. Another plan will look into ways to bring down energy costs for power-guzzling manufacturers.
Part of the package will be a proposal to pare back EU sustainability rules, to quickly cut reporting requirements for businesses.
TECH AND AI
Innovation in Europe is hindered by a lack of venture capital, which is less freely available in Europe than in the U.S., and fragmented rules between the EU's 27 member countries, the Commission said.
To try to fix this, Brussels will introduce an EU strategy in the second quarter of the year, to help start-ups get off the ground. A second act due around the end of 2025 will aim to improve companies' access to new innovations from publicly funded research.
An EU artificial intelligence plan due late this year or in early 2026 will use public and private funding to launch "AI gigafactories" to train large AI models, it said.
The EU will also work with the European Investment Bank on a programme to help scale up innovative companies in areas like AI and quantum computing.
FUNDING/INVESTMENT
Brussels said the EU lacks an efficient capital market. An upcoming proposal will try to fix this by creating new savings and investment products.
The EU will also establish a fund dedicated to improving competitiveness by targeting investments in technologies like AI and clean tech, under the bloc's next budget for 2027 onwards.
EU state aid rules will also get a makeover in the second quarter of this year, to encourage faster investment in clean industries, and the Commission said it is revising its rules for assessing mergers to focus more on innovation.
BUYING LOCAL
The EU wants to introduce a European preference in public procurement for certain strategic technologies to make the bloc less reliant on foreign imports and boost demand for locally made clean technologies. That proposal is due in 2026.
Still, Europe will continue to import many of the technologies needed to meet green goals. Brussels said it will also take a harder line on unfair competition from abroad, including by using trade defence instruments.
STAY THE COURSE ON CLIMATE GOALS
The EU said that while a dramatic simplification of rules is needed, it is sticking to its green goals - despite calls from some politicians and industries to weaken recently approved climate laws.
Many of the planned initiatives aim to help European industries get on track to cut EU emissions by 90% by 2040 - a target the EU said it plans to make legally binding with a proposal later this year.
However, the Commission signalled that certain sectors struggling to comply with green rules will be offered relief. Brussels will look at "possible flexibilities" to help carmakers facing potential fines for not complying with 2025 CO2 emissions rules, the document said.
(Reporting by Kate Abnett, Philip Blenkinsop; Editing by Hugh Lawson)
The article discusses the EU's plan to enhance industrial competitiveness through innovation and decarbonization.
The plan includes simplifying rules, speeding up investments, and creating AI gigafactories.
The EU will introduce strategies to improve access to venture capital and support for start-ups.
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