Budapest Declaration
Council calls for a new deal for European competitiveness.
UM – 11/2024
In their Budapest Declaration on 8 November, the heads of state and government of the Member States of the European Union (EU) called for an improvement in European competitiveness, the preservation of sovereignty, security and resilience and the safeguarding of economic prosperity. Existing innovation and productivity gaps need to be closed. Following on from its conclusions from April 2024, the European Council identifies a number of "drivers" and states its expectations of the new European Commission. They have to get to work quickly. Here are some key points:
Single market
A fully functioning single market is central to innovation, investment, growth, convergence and economic resilience. By June, the Commission is to present a comprehensive horizontal strategy for deepening the single market, which will set out a clear timetable with fixed milestones.
Capital markets union
The Council had called for rapid progress on the capital markets union as early as April. The legislative package also contains the proposal for a directive on the harmonisation of insolvency law. Further progress would also be needed to realise a savings and investment union by 2026.
Debureaucratisation
Companies need a clear, simple and intelligent legal framework and less bureaucracy. In its industrial strategy, the Commission is to make specific proposals to reduce reporting obligations by at least 25 per cent in the first half of 2025. When preparing legislative proposals, impact assessments on administrative burdens and competitiveness should also be included.
Digitalisation, research and development
The digital transformation should be accelerated in all sectors, technological capacities should be expanded and the opportunities of the data economy should be utilised. Proposals are to be submitted by June 2025. In order for Europe to assume a leading position in research and development, expenditure in this area should amount to three per cent of gross domestic product by 2030.
Social dialogue
Europe has high social standards. In line with the European Pillar of Social Rights (EPSR), social dialogue is to be strengthened, while ensuring equal opportunities and reducing inequalities. The aim is to tap into talent and invest in skills in order to promote high-quality jobs.
Funding
The Draghi report "The Future of European Competitiveness" has shown: Europe must invest significantly in order to keep the continent globally connected and secure its prosperity (see also DSV News 09/2024). Mario Draghi had put forward a figure of EUR 750 billion per year. Regardless of whether this sum is reached, private capital as well as public investment are needed. On 8 November, the heads of government expressed their resolve to make use of the multi-annual financial framework, the capital markets union and greater involvement of the European Investment Bank and to mobilise as much funding as possible. This also includes the examination of new own funds.
The DSV welcomes the fact that the European Council, despite its focus on the competitiveness of the EU, has not overlooked the fact that a functioning single market and a strong European economy require comprehensive social support. The EPSR should rightly continue to serve as a compass for this.