Europe has no shortage of ideas – only a shortage of speed.
A year after Mario Draghi’s landmark report on competitiveness, the European Union faces a test of purpose. Its strengths remain formidable: world-class universities, deep capital pools, and a culture of scientific rigour. Yet the system built to prevent crises now struggles to seize opportunities. Institutions designed for caution, consensus, and control – virtues that once guaranteed peace – risk paralysis in a world moving faster than Brussels can deliberate.
Draghi’s appeal for “massive investment” and “new speed, scale, and intensity” is not a call to mimic Washington’s industrial assertiveness or Beijing’s state direction. It is an argument for collaboration on risk – for governments, investors, and firms acting together in the confidence that collective effort multiplies results.
There are early hints of this shift. The Commission’s emerging AI-deployment agenda seeks to move artificial intelligence out of research labs and into Europe’s factories, hospitals, and energy grids. Germany’s willingness to let a European supervisor oversee segments of its financial market could unlock the long-discussed Capital Markets Union. And the expansion of the Global Gateway programme to €400 billion signals that Europe is beginning to project industrial strength abroad, not only its familiar diplomacy.
Such steps may seem incremental, but they matter. They suggest that competitiveness itself is becoming a form of sovereignty – the capacity to act rather than to react.
The unfinished single market remains Europe’s main drag. According to the IMF, internal barriers impose the equivalent of tariffs of 44 percent on goods and 110 percent on services – higher than trade frictions between American states. Fragmentation drains not just money but momentum; a start-up can often scale more easily from California to Texas than from France to Poland. A “28th regime,” offering one voluntary legal framework across the bloc, would be a modest reform with disproportionate signal value: proof that Europe still knows how to make growth happen.
Europe’s enduring strength lies in pairing innovation with integrity. In a global economy short on trust, that balance is an economic asset. The EU’s cautious approach to technology and data can be seen not as hesitation but as discipline – a model of growth grounded in transparency and accountability. Applied to digital transformation, that mindset could make Europe the benchmark for responsible competitiveness, expanding capacity in AI, clean energy, and life sciences without abandoning ethical foundations.
In order to do this, Europe will need to replace its reflex to subsidise with a readiness to scale. The United States competes through speed – China through coordination. Europe’s advantage lies in intelligent aggregation, by combining scientific excellence, industrial depth, and regulatory credibility. That requires deeper capital markets, simpler procurement rules, and recognition that computing power should now be treated as basic infrastructure. Public funds should attract private capital, not crowd it out. As Draghi noted, “the more we push reforms, the more private capital will step up.” Evidence of that dynamic is already visible in parts of the AI and cleantech ecosystem, where regulatory clarity is beginning to unlock investment.
Europe’s trajectory will shape more than its own prosperity. A confident, competitive Europe underpins the transatlantic alliance and shows that competitiveness can coexist with transparency and public trust. A hesitant Europe risks dependence on American technology, Chinese manufacturing, and Gulf capital. Whether the continent aligns regulation with renewal will influence the next chapter of globalisation. If it remains a rule-maker without a growth engine, others will define the terms of the digital economy. But if it can turn principles into products, Europe could show that trust is not a brake on growth – it is the foundation of sustainable, shared prosperity.
For all its bureaucracy and self-doubt, Europe retains a quiet confidence others envy. It is still the world’s largest trading bloc, its currency a global reserve, its universities among the best, and its standard of living among the highest. The ambition is there; only the follow-through falters. Acting on even part of Draghi’s plan – deeper capital markets, smarter regulation, a truly open internal market – would convert that latent strength into renewed competitiveness.
That would mark more than recovery. It would signal that progress rooted in trust can still move the world.