Revitalizing European competitiveness through innovation: A bold call to action

Europe’s economic foundations are facing unprecedented challenges, as highlighted in Mario Draghi’s recently published report. The continents’ trade is declining, and European companies – especially startups – are grappling with increasing competition and limited access to key markets. In response, the S9+ coalition is urging the D9+ ministers to take decisive steps in revitalizing Europe’s competitiveness and economic influence.

Alarming decline in European economic influence

Europe’s presence in the global economy has significantly waned over the past few decades. Once responsible for a quarter of global GDP, the continent now faces the stark reality that its GDP per capita is only half that of the United States. Moreover, no European company ranks among the world’s top 10, underscoring a lag in research and development and investment in critical technologies. Europe has also fallen behind in producing tech unicorns, with over 100 tech-related laws and 270 regulators active in digital networks across Member States, which some argue contribute to this stagnation.

Economic resilience calls for European leadership

Europe’s future depends on its ability to adapt, innovate, and lead in the global digital economy. To reclaim its position, Europe must prioritize international collaboration, regulatory reform, and AI-driven innovation. Striking a balance between data privacy and competitiveness, advancing the digital green transition, and improving governance will be key.

The D9+ member states must rise to this challenge, providing the vision and leadership needed to enrich a thriving startup ecosystem. The time for bold action is now. Only through decisive, united efforts can Europe ensure sustainable growth and secure its economic future.

The creation of a Digital Single Market is crucial for Europe’s startups. A digital wallet that facilitates seamless cross-border transactions could help unlock the continent’s economic potential. However, regulations governing this market must be “light but right”, fostering a balance between user protection and flexibility for businesses to innovate.

Transforming from a regulatory burden to a innovative powerhouse

For Europe to regain its economic strength, a complete overhaul of its regulatory framework is necessary. Policies should not simply react to immediate challenges but must be forward-thinking, positioning Europe to seize future opportunities. The current regulatory environment risks stifling growth. Notably, 67% of EU startups fear new regulations could hinder innovation. A “think small first” approach, prioritizing the needs of startups, should be adopted, meaning that Europe must tread carefully, particularly in burgeoning fields like AI. We think that overly stringent regulations drive innovation abroad unless the EU crafts policies that strike the right balance, ensuring startups can thrive while protecting consumers and maintaining fair competition.

The great news is that Europe possesses the tools to transform itself into a global startup powerhouse, but in order to take advantage of the capacities, the continent must foster a dynamic and open market environment that encourages innovation and supports startup growth. This demands a regulatory overhaul, and that is why we urge the political leaders to craft policies that not only address current challenges but also seize future opportunities.

You can read the full declaration here.