Speech by Executive Vice-President Vestager to the Orgalim Conference

(Source: European Commission)

“Check against delivery”

Good afternoon.

Thank you to Orgalim, and to President Rodriguez, for hosting this event. I really like the themes you have chosen – innovation, sustainability and competitiveness. These are three concepts that inspire our work in strengthening the Single Market – our greatest achievements and the fabric of our success for more than 30 years

Innovation

You have placed innovation first and I think that is right. As you know, innovation is a catalyst for growth and prosperity. But it is also deeply linked with fostering sustainability and maintaining Europe’s competitiveness. If we are to manage the green transition; if we are to build resilience and safeguard Europe’s place in the new global economy, we will need innovation to get us there.

That begs the question: how do we get innovation? There are a million secret recipes, I suppose. But from the point of view of public policy, we must set clear, transparent and fair market conditions for a level playing field – one in which businesses can grow and innovate the best possible products.

That is why our work in further integrating the Single Market is so central to innovation. By lowering and removing barriers to entry, the EU’s competition policy keeps doors open, especially for SMEs and entrepreneurs who are often the ones to come up with fresh ideas.  With competition rules, we make sure that markets don’t become dominated by large players by acquisitions and that the bigger firms in any sector don’t make it harder for smaller competitors to enter and grow.  I don’t have a crystal ball, but my bet is the European entrepreneur everyone will be talking about in fifteen years’ time, has not yet finished secondary school. Our job is to keep the doors open, so that she can reach her full potential, when the time comes.

One of the things we can do to create the foundation for innovation is to develop sound policies on data. The new Data Governance Act is designed to make data sharing possible, by creating neutral data intermediaries so that SMEs can access the data they need to innovate. The Data Act takes the next step, by protecting SMEs and start-ups from unfair data sharing clauses in contracts, and by excluding gatekeeper platforms from benefitting from data sharing.

SMEs will also benefit from the new regulation on Artificial Intelligence. By proposing the first ever framework on AI, we want to ensure a harmonised approach across Member States – creating the certainty and transparency businesses need to take advantage of these new opportunities.

In the case of Important Projects of Common European Interest, we have foreseen a way for multiple countries and actors to come together to pool resources and expertise to address the really big challenges through breakthrough innovation. Crucially, we have designed the system to only step in when the market doesn’t deliver, and by ensuring projects benefits are widely shared.

Sustainability and resilience

Sustainability is every bit as important. That’s what the Green Deal is about. In fact, the main challenge of our times is creating an economy that is resilient and strong, but which respects the ecological boundaries of our planet.

We have many tools at hand. First of all, we have regulatory tools to create harmonised sustainability standards for the single market. This is what we do via the eco-design regulation, the right to repair or the need to provide a common charger. This creates the benchmark for sustainability requirements in the single market which allows then for further innovation towards green products and services.

Second, sustainability requires change. The EU Recovery Plan was launched with this in mind. Not only does it have a focus on reform and innovation, but it channels unprecedented EU funding into accelerating the green and digital transition and helping the Union meet its ambitious climate targets for 2030 and 2050. This will help us transform a challenge into a whole series of opportunities for innovation – whether that is in e-mobility, renewable energy, or next generation waste management systems.

The current energy crisis is another case at hand. The illegal aggression of Russia against the people of Ukraine has laid bare the urgent need to diversify energy supplies. It was a radical action taken by the Russian leadership, and it calls for decisive action on our part. This is what our new plan, REPowerEU, proposes to do: to reduce dependence on Russian gas by two thirds, before the end of this year. A combination of short term and medium-term measures will get us there – common purchasing of LNG, but also accelerating investments in renewable energy. Of course, this comes on top of already agreed sanctions, such as the oil embargo.

Sustainability is also about stepping in and taking effective action to strengthen our resilience. When the pandemic struck, it exposed certain dependencies in global value chains. As part of our industrial strategy, we are identifying strategic areas where we may need to do more. Not alone but in cooperation with trading partners.

We are taking actions where it is needed, where the market alone cannot deliver.

The EU Chips Act is a good example of how public policy can work to support the market.

Our need for secure and sustainable access to critical raw materials is another challenge. And what a pleasure to be in Sweden and see that there are so many raw materials available here that we do not need to source from other parts of the planet. We are carefully monitoring the supply of critical raw materials and the roadmap is already quite clear. We are working with international partners to diversify supplies, as well as to improve circularity and recycling in manufacturing and waste systems. We collectively have to put more efforts into it.

Because we are in this together. Public funds should be spent to facilitate the necessary private investments, not to crowd out private investments. And public authorities should never take over tasks that businesses are better placed to do. And we should also not take over responsibilities from businesses. Strategic dependencies are also the consequence of conscious economic decisions by the industry.

We need to balance the need for public actions in view of the specific situation and specific objectives we are pursuing. The Chips Act is an exceptional response to an exceptional situation. When it comes to raw materials, we need to carefully assess whether legislative actions are needed.

Competitiveness

At the same time, we need to work constantly to ensure the smooth functioning of the Single Market at all times.

It means also in extreme times. We are working on the Single Market Emergency Instrument. But we cannot always live in an emergency mode. Instability is part of our environment and is here to stay. We have to accept it and catch the new opportunities created and increase our competitiveness. And like before, increasing our competitiveness, means accelerating the completion of the Single Market. I count on your support and contributions. And I trust it that Sweden will play a decisive role in this context during its presidency in 2023.

Together, we will continue to rigorously enforce our Single Market rules, knowing that the competition we practise here at home is what makes us strong in global markets too.

Speaking of ‘global markets’, our vision builds on Europe’s positive experience with our own Single Market. This idea is to have the most free and open movement of capital, goods and people that we can have, while at the same time recognising that in order for such a system to work, there must be rules in place. The idea is to achieve ‘competitiveness through fairness’.

Let me explain what I mean, by way of example. We have proposed a new law on Foreign Subsidies, which would restrict companies who compete on the Single Market from tapping unfair subsidies paid by foreign governments – the sorts of subsidies which EU countries are not allowed to pay under our rules around State aid control. This is not about protectionism. It is about putting in place fair rules that keep the Single Market open to everyone; and at the same time we safeguard competitiveness.

The Digital Services Act is another tool for ‘competitiveness through fairness’. It makes sure European online sellers are not unfairly disadvantaged by overseas operators who sell unsafe or counterfeit products online. And for smaller businesses, the real advantage is that it will reduce compliance costs. Without a harmonised EU approach, online sellers would be forced to navigate the different national rules. As many of you know, those kinds of compliance costs can be prohibitive for SMEs.

It is obvious that open strategic autonomy is first and foremost about working with partners, it is about developing collaborations and cooperation to address the challenges we are all facing. I already mentioned our strategic partnerships on raw materials. The Trade and Technology Council with the US is another excellent example of such cooperation. It is an essential part of our strategy on chips. Because we have so much to benefit from the outside world.

Conclusion

The themes of innovation, sustainability or competitiveness are useful in themselves, but in truth they are really three aspects of the same issue. No one believes that EU long term competitiveness can be built without massive innovation, in particular in environmental and low carbon technologies.

That is why this morning’s ‘Innovation Safari’ [I wish I could have attended in person] was so inspiring, the start-ups that you showcased this morning are all excellent examples of how this works in practice: the creative energy of young European businesses, who are innovating at the very intersection of competitiveness and sustainability.

We need these businesses to build our future and we need the leadership and orientation that Sweden provides.

Thank you.

Privacy Preferences
When you visit our website, it may store information through your browser from specific services, usually in form of cookies. Here you can change your privacy preferences. Please note that blocking some types of cookies may impact your experience on our website and the services we offer.