Mario Draghi’s report on competitiveness: What messages for Cohesion Policy?

September 2024

Europe's economic growth has been slowing for more than two decades and the productivity gap with global competitors such as the US and China is widening. The recently published 2024 report 'The Future of European Competitiveness: A Competitiveness Strategy for Europe (Opens in a new window)', highlights the changes and challenges the EU must overcome to regain its competitive edge.

This comprehensive report focuses on boosting productivity, addressing geopolitical dependencies and leading decarbonisation – all while upholding the EU's values of equity, social inclusion and sustainability. The report has been written by Mario Draghi, a key figure in European economic policy and former president of the European Central Bank (ECB), widely credited with steering the eurozone through the financial crisis. His background as an economist and former Prime Minister of Italy makes him a seasoned expert on economic governance and recovery.

This blog post looks first at selected key messages from the report and then at possible implications for Cohesion Policy. The report provides arguments for for a stronger investment focus and more territorial cooperation.

The future of European competitiveness: Key challenges and changes

The Draghi report analyses the current state of EU competitiveness and provides a clear set of recommendations for policymakers to ensure EU’s long-term economic prosperity. It focuses on sectoral and horizontal policies, addressing critical areas such as energy, digitalisation and clean technologies, with an emphasis on enabling Europe to lead in these vital areas.

At its core, the report conveys a stark reality: The EU needs to boost productive investment. Draghi argues that at least €750-800 billion of additional investment per year is needed. This is needed to address the urgent transformation of the EU economy, particularly in energy, digital infrastructure and industrial policy, and thereby close the widening competitiveness gap with global players such as the US and China. High energy costs, technological backwardness and dependence on imported raw materials are the main threats to its future competitiveness. The report stresses that the EU's success depends on accelerating decarbonisation, innovation and investment in clean technologies.