An Integrated Industrial Policy for Competitiveness and Sustainability
Europe needs industry and industry needs Europe. The Single Market, with 500 million consumers, 220 million workers and 20 million entrepreneurs, is a key instrument in achieving a competitive industrial Europe. One out of four jobs in the private sector in the European Union is in the manufacturing sector, and at least another one out of four is in associated services that depend on industry as a supplier or as a client, such as logistics. However, in the last decade the global business environment has changed radically. The financial and economic crisis has focused even more attention on the central importance of a strong, competitive and diversified industrial manufacturing value chain for the EU’s competitiveness and jobcreation potential. These developments present both challenges and opportunities for European industry.
A solid and integrated industrial policy is needed to help industry seize these opportunities, and should incorporate the following elements:
- Competitiveness and implementation of smart regulation. Increased and more systematic efforts need to be made by Member States to reduce administrative burden, to pursue better regulation and e-government policies, to apply the “think small first” principle and to simplify support schemes.
- The development of business-related services such as logistics, facility management, design, marketing and advertising are becoming ever more essential to modern manufacturing. They are both essential inputs and enhance the value of products. In some Member States, road transport and energy infrastructures need attention.
- Standards should not create an additional burden. Instead, they should lead to efficiency gains and act as an incentive for innovation. The ultimate aim should be convergence of standards at world level.
- A new industrial innovation policy is needed to encourage the much faster development and commercialisation of goods and services and to ensure that EU firms are first onto the market. Improved use of ICT for industrial competitiveness, logistics, resource optimisation and innovation will be essential for future competitiveness.
- Industry is increasingly dependent on inputs of raw material and intermediate goods, and is also crucially dependent on the business services industries and efficiency of logistics that add value and help to design and market new goods and services. This new perspective requires a different approach to industrial policy that takes increased account of the interlinkages.
Europe needs new governance for industrial policy. Whilst the economic and financial crisis shifted the focus of industrial competitiveness policies towards short-term rescue and recovery actions, in the future the attention of policymakers has to focus on long-term structural challenges, in particular maintaining global competitiveness, climate change, energy, population ageing, skills and knowledge.