Economy: What To Concretely Remember From The Draghi Report?

The former President of the European Central Bank, Mario Draghi, has just delivered a crucial report on the future of the European Union’s economy. This document, eagerly awaited by observers, presents a grim assessment and proposes bold solutions to reinvigorate the competitiveness of the Old Continent.

Draghi Report: A Wake-Up Call to Revitalize the European Economy

The Draghi report paints a worrying picture of the economic decline of the EU. The figures are unequivocal: over two decades, the EU’s GDP has fallen by 15% compared to that of the United States. European productivity is stagnating, while its global market shares are inexorably eroding.

Even more troubling, Europe is significantly lagging behind in advanced technologies. Of the world’s 50 largest high-tech companies, only four are European. The finding is unequivocal: the Old Continent missed the boat on the latest industrial revolution.

Other structural weaknesses are highlighted:

• Prohibitively high energy costs, up to four times those of the United States
• Critical dependence on foreign sources for certain strategic resources
• An overly fragmented single market, hindering the emergence of European giants
• Deficient economic governance, incapable of defining a coherent strategy

An Ambitious Action Plan to Right the Ship

In the face of this alarming assessment, Mario Draghi proposes a bold roadmap. The goal: to massively increase the EU’s annual investment rate, raising it from 22% to 27% of GDP. This represents a colossal effort of 800 billion euros per year.

To achieve this, the report recommends three main levers:

1. An increase in public investment spending by member states
2. The mobilization of European savings towards common innovative projects
3. The creation of a new community financing facility, modeled on the post-Covid recovery plan

Draghi also emphasizes the need to simplify European economic governance and create a “Competitiveness Coordination Framework” to effectively steer this strategy.

While the diagnosis and proposals of the Draghi report enjoy broad consensus, their implementation remains uncertain. The divisions between member states persist, notably on the issue of a common debt.