New economic ‘compass’ helps EU steer competitiveness challenges

THE European Union “competitiveness compass”, launched last week, might be dismissed as a political gimmick. However, European Commission President Ursula von der Leyen has dubbed the tool as Europe’s economic “North Star” not just for her new team’s first 100 days in office, but also for the next five years.

The reason is the growing recognition that the EU faces an increasing competitiveness challenge vis-a-vis other key world powers, especially the US, with growing pressure to be perceived to put deregulation before decarbonisation in a more business-friendly Brussels.

Indeed, competitiveness is not only the No 1 economic problem facing the bloc, but may even be an existential threat, as former European Central Bank president Mario Draghi highlighted last year in his landmark report.