Annex: Key priorities to boost competitiveness
Mainstreaming to ensure EU reindustrialisation
1. The Communication says that industry's interactions
with the rest of Europe's economy extend far beyond manufacturing,
spanning raw materials and energy upstream and business and consumer
services downstream, and with industrial activities being integrated
in increasingly rich and complex value chains, linking flagship
corporations and SMEs across sectors and countries. It states
that business services should be properly taken into account in
the design and implementation of industrial policy strategies,
and that, in order to be able to reindustrialize Europe through
an increase in manufacturing's share of GDP to 20% by 2020, there
is a need for all concerned — including Member States —
to put industrial competitiveness at the centre of policy making,
and ensure that all aspects of policy areas affecting competitiveness
are taken into account.
2. The Commission says that, following the 2012
Industrial Policy Communication, it set up in the beginning of
2013 a High Level Group on Business Services, and proposes to
examine the need for further action when the group issues its
recommendations in March 2014. It will also closely monitor the
recently updated European Standardisation System, in order to
assess whether it needs to be further adapted to a rapidly changing
environment, and so continue to contribute to Europe's strategic
objectives, particularly in the field of industrial policy, services,
innovation and technology development. In addition, the Commission
proposes that, from 2014, the Report on Member States' Competitiveness
Performance and Policy should be strengthened to evaluate and
clearly link the impact of improvements in the business environment
on the progress in Member States' actual competitiveness performance,
and it says that the scope of its annual reports will be extended
to monitor efforts at national level to mainstream competitiveness
aspects into other policy fields.
Stimulating investment in innovation
3. The Commission says that it has for the first
time put an increasing share of its policy at regulatory and financial
levers at the disposal of Member States, regions and industry
to foster investment in innovation. It will also, through its
industrial leadership pillar of the Horizon 2020 programme, provide
close to €80 billion for research and innovation, which will
help to make existing industries cleaner and smarter via support
for key enabling technologies which will redefine global value
chains, enhance resource efficiency and reshape the international
division of labour. Horizon 2020 will also finance closer-to-market
prototypes, and join forces with the private sector through public-private
partnerships in key industrial areas, so as to leverage further
private investment.
4. The Communication highlights that, with the adoption
of the new Multiannual Financial Framework for 2014-20, at least
€100 billion of European Structural and Investment Funds
(ESIF) are at the disposal of regions to finance support for industry
and SMEs in line with their smart specialisation strategies. It
says that it is modernising the State Aid Framework for Research
and Development and Innovation, and reforming public procurement
rules to create a critical mass on the demand side and improve
efficiency in the allocation of resources in full respect of competition
and internal market rules: and, as a result of the need to speed
up investment in breakthrough technologies in fast growing areas,
it decided in 2012 to identify the six areas[5]
in which investment should be encouraged, with the corresponding
task forces set up in 2013 having enabled the identification of
opportunities for, and obstacles to, innovation requiring further
policy action.
5. The Communication says that, based on this work,
it will pursue the following priorities in these cross-cutting
areas:
Advanced manufacturing
The Commission will implement the Knowledge and Innovation
Community on value-added manufacturing and establish a Public
Private Partnership on Sustainable Process Industry through Resource
and Energy Efficiency, Factories of the Future, Photonics and
Robotics, upgrading innovation capacity and competitiveness of
Europe's manufacturing sector. The integration of digital technologies
in the manufacturing process will be a priority for future work
in light of the growing importance of the industrial market, and
the use of "big data" will be increasingly integrated
in the manufacturing process.
Key Enabling Technologies (KETs)
The task force is working on the identification of
potential KET projects of European interest in a number of areas,
and facilitating pan-European access by SMEs to technological
infrastructure. It will also further exploit the possibilities
of a Memorandum of Understanding signed with the European Investment
Bank (EIB).
Bio-based products
The Commission will grant access to sustainable raw
materials at world market prices for the production of bio-based
products. It says that this will require the application of the
cascade principle in the use of biomass, and eliminating any possible
distortions in its allocation for alternative uses which might
result from aid and other mechanisms favouring its use for other
purposes, such as energy.
Clean Vehicle and Vessels
The Commission advocates the adoption and full implementation
of the draft Directive on the deployment of an alternative fuels
infrastructure, implementing the Green Vehicle Initiative and
other Horizon 2020 initiatives promoting clean and energy efficient
transport, pursuing global standards for electric cars and implementing
the priorities identified under the CARS 2020 programme.
Sustainable construction and raw materials
The Commission proposes to set up a €25 billion
European Investment Bank lending capacity for energy efficiency
in residential housing, and to improve recycling and sustainable
waste management in construction.
Smart Grids and Digital Infrastructure
The Commission plans to define further targets for
the development of smart grid components; revise and broaden standardisation
mandates; and development and guidance on performance indicators.
The infrastructure and connectivity software for industrial internet
is identified as a priority area as a result of its growing importance,
which should help to integrate high performance processes, including
cloud computing.
A more business friendly framework — SMEs
and Entrepreneurship
6. The Communication highlights the need for European
SMEs to overcome the barriers which limit their growth, and says
that it continues at the EU level to improve the quality of legislation
and the regulatory environment in order to make it more stable
and predictable. It highlights the following actions it intends
to take to remove the barriers to growth:
· Implementation of the Regulatory Fitness
and Performance (REFIT) programme, and following up the top
10 regulatory burdens identified by SMEs so as to simplify EU
legislation and reduce regulatory burden on business.
· Competitiveness Proofing has been
integrated fully into the Commission's impact assessments for
all major proposals with significant effects on competitiveness.
· The financial perspectives for 2014-2020
make available new and more powerful instruments in support
of entrepreneurship and SMEs, with there being for the first
time a programme (COSME) specifically targeting SMEs with a budget
of €2.3 billion to add to the contributions made by other
EU policies. The new cohesion policy also pays particular attention
to the competitiveness of SMEs, whilst Horizon 2020 provides funding
for early stage, high-risk research and innovation by SMEs, and
the new rural development policy further boosts start-ups and
the competitiveness of SMEs in rural areas.
· The potential of clusters to create
favourable innovation ecosystems for mutually reinforcing groups
of SMEs is to be exploited as a means of exploiting growth, and
the Commission will facilitate the matchmaking of SMEs wishing
to integrate into world-class clusters aiming for excellence and
cross-European value chains, with the focus being both on industrial
sectors and on facilitating cross-sectoral and cross-border collaboration
and innovation.
· An updated Small Business Act,
where the Commission will take new action or propose new legislative
measures to ensure that start-up companies in all Member States
are able to set up at a maximum cost of €100, and within
three days, as well as proposing a target of one month to obtain
the necessary licences. The aim is to create more synergies with
the reform process under the European Semester, helping SMEs to
grow and create jobs.
· The development of conditions to reduce
the duration of court litigation of credit recovery for companies,
and to give a second chance to honest entrepreneurs and facilitate
the transfer of business.
· requesting Member States to introduce
the SME Test or an equivalent system in their decision making
process, and reduce the administrative burden.
· an initiative on Growth-Friendly Public
Administration, providing a comprehensive overview of the
best practices in public administration available across the EU,
particularly as regards e-government tools and public procurement.
· reinforcing the Entrepreneurship Action
Plan to develop entrepreneurial skills and attitudes and to
facilitate individuals in developing new ideas.
Easier access to critical production inputs
7. The Communication highlights that EU firms need
to have access to essential inputs in a sustainable way and on
the best possible terms, but notes that significant problems still
exist in capital, energy and raw material markets. These include:
Access to finance
The Communication states that policy actions are
contributing to the alleviation of capital needs for specific
purposes; that the 2014-2020 cohesion policy will continue to
provide access to finance to enterprises through financial instruments;
that the amendment of the Common Provisions Regulation will allow
the development of risk-sharing instruments with EU guarantees;
that the European Structural and Investment Funds (ESIF) or the
European Social Fund and financial instruments supporting lending
to SMEs, and small midcaps (COSME & Horizon 2020) will be
available to Member States on a voluntary basis, and will multiply
the financing capacity of public sector funds with equity investments
through financial intermediaries, such as venture capital funds,
and a well-functioning pan-European venture capital market.
The Commission says that full implementation of the
Late Payments Directive should also improve financing for companies,
but that an internal market for capital where SMEs can have access
to cross-border finance still remains an unfulfilled goal.
Access to Energy
The Communication says that, despite efficiency gains
and the progressive opening of the energy markets to competition,
EU retail electricity prices for industry grew on average by 3.5%
a year and gas prices by 1% between 2008 and 2012, and that, as
a result, EU industrial electricity prices are estimated to be
twice as high in the USA and Russia and 20% higher than in China
(which it describes as a matter of concern for the competitiveness
of energy intensive industries). It also highlights the recent
adoption of a climate and energy package from 2020 to 2030.
Access to raw materials
The Communication says that EU industry faces a number
of challenges regarding access to both primary and secondary raw
materials throughout the whole value chain, with the majority
of the most "critical" of these being sourced mainly
from outside the EU. The Commission plans to continue to use all
instruments, including a current mapping exercise of raw materials
diplomacy, to safeguard access to raw materials, and to pay special
attention on ongoing and future trade negotiations. It also proposes
in 2014 to present a set of actions to promote technologies able
to replace critical raw materials, improve environmental and energy
performance of products, strengthen the European Innovation Partnership,
and improve recycling.
Maximise the potential of the internal market.
8. The Communication says that the internal market
provides EU companies with a large home market, facilitates productivity
improvements by reducing input costs, allowing efficient business
processes and increasing returns on innovation, but that there
is still significant potential for growth, and that further simplification
of internal market rules can improve economic efficiency, with
deepening the internal market bringing about faster technological
change. It highlights the importance of speeding up the adoption
of Commission proposals to complete infrastructures and simplify
and improve the business environment in the internal market, and
it calls on the Council, European Parliament and Member States
to adopt and/or enforce the initiatives related to the integration
and completion of the internal market which are currently subject
to delays, such as transport, energy and ICT.
9. The Communication invites Member States to:
Unleash the potential of the transport sector
The Communication notes that the Commission adopted
in early 2013 the fourth Railway Package, which makes it easier
for rail operators to enter and operate in the EU market, and
intends to establish a new joint undertaking (Shift2Rail) to drive
innovation in the rail sector. Also, in the maritime sector, it
set out in July 2013 plans to ease custom formalities for ships,
thus reducing red tape, cutting delays in ports and making the
sector more competitive, and it is proposing active steps to enforce
the single European Sky obligations in Member States.
Speed up development of clean vehicles
In order to speed up the development of clean vehicles
and vessels in Europe, the Commission says that the adoption of
its proposal on the deployment of alternative fuels infrastructure
will stimulate economic growth in Europe by mandating a minimum
coverage of alternative fuel infrastructure, including electric
recharging stations with common interface standards.
Creating an internal market for ICT to reduce
roaming costs
The Commission says that the EU, Member States, regions
and industry all have a co-ordinated role in fostering the digitalisation
of business processes, contributing to the development and implementation
of an industrial dimension of the digital agenda. and promoting
competition in broadband provision. It highlights the proposal
for a single market in telecommunications, aimed at promoting
investment and taking steps to further decrease regulatory fragmentation
in the EU: and it suggests that the convergence of information
and communication technologies with energy and logistics networks
will create a new landscape of opportunities and challenges for
industry and related services (which will provide market opportunities
for key enabling technologies, redefine global value chains, and
reshape patterns of specialisation).
Liberalise and integrate the internal market for
energy to reduce costs
The Communication says that the development of an
internal market for energy requires integrated energy networks
which would reduce energy costs for European companies.
Complement space infrastructures to offer new
business opportunities
The Commission is contemplating rules creating the
technological and regulatory conditions for space infrastructure
commercial exploitation, and is currently completing space infrastructures,
with its flagship projects (Galileo and Copernicus)
during the next financial perspectives.
Strengthen the market surveillance and product
safety package for SME development The
Commission calls on the co-legislators to adopt its proposals
on the market surveillance and product safety package, and says
that it will ensure that harmonisation is enforced and that the
participation of SMEs in the Single Market is facilitated.
Improve the functioning of the internal market
for services
The Communication highlights that full implementation
of the Services Directive remains important for Europe's industrial
competitiveness, and needs to be improved, emphasizing that a
more integrated internal market would boost the competitiveness
of business services and industry, and advising these should be
taken into account adequately in the design and implementation
of industrial strategies. It adds that it will define further
action after the High Level Group on business services issues
its recommendations in March 2014.
10. The Commission plans to take new actions in the
following fields-
Well-designed European standards to accelerate
the diffusion of innovations
The European Standardisation System is being reviewed
in order to assess its adaptability to the rapidly evolving environment
and to contribute to Europe's strategic internal and external
objectives, in particular in the field of industrial policy, innovation
and technological development.
Effective standard-setting and the protection
of intellectual property.
These are seen as crucial for promoting innovation
and the development of new technology areas, and the Commission
intends to clarify the rules on the use of IPR in standards and
will pursue an initiative on IPR-based standardisation.
A more integrated internal market based on the
existing regulatory framework.
The Commission says that, along with its Communication
"A vision for the internal market for industrial products",
it will also prepare a Regulation on Enforcement to help to reinforce
a level playing field for compliant products in the EU. Also,
the Enterprise Europe Network will be reinforced to strengthen
support for SMEs in the internal market and further enhance the
assistance given for access to finance and for the innovation
management capacity of SMEs.
Internationalisation of EU firms
11. The Commission sees the internationalisation
and the integration of EU firms in global value chains as a means
of increasing their competitiveness and ensuring access to global
markets in more favourable competitive conditions. It says that,
in order to promote access to markets around the world, it will
continue to pursue Free Trade Area negotiations with key bilateral
partners, and to act within the WTO agreement to prevent third
countries putting up technical barriers to trade. It also plans
to pursue the following actions:
· Missions for growth will be reinforced,
and the services of the Enterprise Europe Network put to better
service to support the internationalisation of SMEs.
· Continued promotion of international standards
and regulations, building on the EU's role as a de facto setter,
and take a leading role in reinforcing the international system.
· Regulatory cooperation with other countries
will continue to be a priority.
· Ensure EU companies are able to uphold
their Intellectual Property Rights in all relevant markets.
· bilateral negotiations with Canada have
yielded significant advances in public procurement access, and
this will also be pursued in the corresponding negotiations with
the United States and Japan.
Improving education and training and facilitating
mobility
12. The Commission notes that it has put in place
an overall strategy for improving education and training systems,
new comprehensive tools to monitor skills needs, and specific
initiatives to bring together the relevant actors dealing with
apprenticeships, in particular those with crucial ICT skills.
It is also developing the following steps to meet the future challenges,
which it invites Member States to support:
· A new generation of the Erasmus for young
Entrepreneurs programme and a new Erasmus+ programme
· The European Alliance for Apprenticeships
and other instruments to make available cross-country traineeships
in firms through the active involvement of industry.
5 Advanced manufacturing, key enabling technologies,
clean vehicles and transport, bio-based products, construction
and raw materials, and smart grids. Back
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