“We need to reignite Europe’s innovation engine,” von der Leyen told a news conference to present the roadmap – vowing that the 27-nation bloc remained committed to meeting its ambitious carbon-reduction goals while also cutting red tape for businesses. “I want to be very clear: the European Union stays on course for the Green Deal objectives without any question,” said the European Commission President.
Faced with US President Donald Trump’s tariff threats and China’s fast ascent in key industrial and digital sectors, EU is under pressure to make life easier for its firms. It hopes to get back in the race by implementing recommendations made last year by former Italian leaders Enrico Letta and Mario Draghi.
Companies complaining
Many companies have complained of excessive regulation compounding high energy costs and weak investments amid the European Commission’s recent focus on climate change and business ethics. Commission Vice-President Stephane Sejourne has promised “a simplification shock without affecting environmental targets”.
Dozens of laws will be revised, with rules on environmental and human rights supply chain standards, reporting on corporate sustainability and chemical safety all facing a trim. A new category of mid-sized company will be created to reduce the regulatory burden for around 30,000 firms, according to the text.A European legal regime, distinct from the 27 national jurisdictions, is to be set up to let innovative companies to benefit from a single, harmonised set of rules on insolvency, labour, and taxation. Europe is suffering from energy costs that are much higher than those of its international competitors after the war in Ukraine cut off supplies of cheap Russian gas.Von der Leyen told a gathering of the world’s elite in Davos recently EU must “continue to diversify our energy supplies” and “expand clean sources of generation” including nuclear power – once a Brussels taboo. The compass also recommends facilitating long-term power purchase agreements and boosting investment in the energy grid to boost transmission and storage.
“Targeted, simplified aid” will encourage industrial decarbonisation, with Sejourne hoping the priority goes towards greening the “top 100 CO2-emitting sites”, which alone account for more than half of Europe’s industrial emissions.
Berlin cuts growth outlook
Meanwhile, the German government cut its growth projections for 2025 amid domestic political instability and the looming threat of higher US tariffs.
Output is now expected to increase by only 0.3% this year, the economy ministry said in a report, down from its previous estimate of 1.1% made in October. Europe’s largest economy looks set to extend its run of poor performance in 2025.
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