The European Union (EU) is lagging behind both the United States and China in terms of economic growth and investments in research and product development. While the US remains the largest economy in the world, when adjusted for purchasing power parity, China takes the lead. The EU is projected to follow suit. Mari Pekonen-Ranta, director responsible for EU affairs in the financial sector, expresses concern about Europe remaining stagnant and failing to innovate. She notes that when growth companies in Europe gain traction, they often relocate to the US, resulting in a loss of money and know-how for European markets.
Jacob Wallenberg, Chairman of Investor’s board, shares similar worries about the rise of protectionism and the potential creation of three separate trading areas: the US, EU, and China. Antti Ronkainen, a researcher of political economy at the University of Helsinki, believes that Europe is heading in that direction with India poised to overtake Europe in the next 10-20 years. Ronkainen highlights the disparity between Europe and China and other countries like India and even America in terms of patents, university degrees, startups, population growth rate and investments in strategic technologies.
Timo Vuori, Director responsible for EK’s trade policy emphasizes on Europe’s lack of productivity calling for increased investments to boost competitiveness. He stresses on moving beyond status quo by investing new initiatives to drive growth.
The discussion on how to make Europe more competitive is available through attached video link inviting further exploration into potential solutions.
