Strategy presented to strengthen economic security of the European Union.
The European Commission and the Union’s High Representative Josep Borrell presented a program for improving economic security on Tuesday. The Covid pandemic, the war in Ukraine, and rising geopolitical tensions have exposed weaknesses in European economies, the paper says. In addition, there would be profound technological change.
The strategy paper, to be discussed by the European Council later this month, is based on three pillars: strengthening competitiveness in Europe, protecting against identified risks, and expanding cooperation with other countries regarding research to strengthen economic security.
According to EU Commission President Ursula von der Leyen, this makes the EU the first major economy to formulate such a strategy.
Reducing Dependencies, Forging New Partnerships
The paper “European Strategy for Economic Security” emphasizes that too much dependence on a single country “reduces Europe’s strategic options” and poses a threat to national economies and EU citizens. Although China is not explicitly mentioned, experts assume that the EU wants to use this strategy to set itself apart from the People’s Republic.
The concept addresses several potential risks for the EU and focuses on possible supply chain difficulties for energy and raw materials needed for technologies such as renewable energies. Therefore, the EU would continue to build on strengthening and diversifying supply chains.
The European Union is heavily dependent on China, especially regarding raw materials such as rare earths for the energy transition. Back in March, the EU Commission President said that she would be in favor of de-risking the EU’s relationship with the People’s Republic. She also sought new trade partnerships during her recent trip to Latin America, where she initiated new cooperations on critical minerals (we reported).
Expanding and Protecting Technologies in the EU
The confederation also wants to restrict third-party access to semiconductor technologies or research projects and aims to develop and protect its own technology. Therefore, the EU is proposing the implementation of a “Strategic Technologies for Europe Platform “(STEP). It should be used for the exchange of projects dealing with digital, clean, and biotech technologies.
However, the presented strategy for economic security has also received criticism from individual EU member states that maintain close relationships with the People’s Republic, as reported by Handelsblatt.