Draghi Calls for Massive EU Investment to Keep Pace with Global Rivals

Mario Draghi's report highlights the urgent need for the European Union to implement a coordinated industrial policy, faster decision-making, and massive investment to maintain economic competitiveness against the United States and China. With proposed annual investments of up to €800 billion, the report stresses the importance of innovation and energy independence.

The European Union needs a far more coordinated industrial policy, faster decisions, and massive investment if it aims to keep pace economically with rivals like the United States and China, Mario Draghi stated in a long-awaited report released on Monday. Draghi, who is the former chief of the European Central Bank and Italian prime minister, was tasked by the European Commission to outline how the EU should enhance its competitiveness in the face of increased global competition.

'Europe is the most open economy in the world, so when our partners don't play by the rules, we are more vulnerable,' Draghi said. The report's initial section suggests that the bloc requires additional annual investments of €750-800 billion, a figure substantially higher than the post-World War Two Marshall Plan. This substantial investment is seen as crucial to addressing the slowing growth rates seen across Europe.

Despite some responsive measures from EU countries, the effectiveness has been limited due to a lack of coordination and fragmented decision-making processes. The report recommends refocusing the EU's efforts on pressing issues through more efficient coordination and new governance procedures. Notably, the report calls for more 'qualified majority voting' and suggests new sources of common funding for ambitious projects, particularly in defense and energy grid investments, to ensure sustained growth.

(With inputs from agencies.)