Europe’s economy is falling behind the United States and China in both growth and investments in research and product development. While the US has the largest economy, when adjusted for purchasing power parity, China takes the lead, with Europe following closely behind.
European leaders are concerned about the lack of new growth mechanisms that lead to a drain of money and know-how to markets outside of Europe. Mari Pekonen-Ranta, director responsible for EU affairs in the financial sector, expresses her concerns while Jacob Wallenberg, Chairman of Investor’s board, echoes these concerns and warns of potential acceleration of protectionism and the emergence of three separate trading areas: the US, EU and China.
Antti Ronkainen, a researcher of political economy at the University of Helsinki predicts that Europe is headed towards being overtaken by India in the next 10-20 years. The trend of falling behind in terms of patents, university degrees, startups worth over a billion, population growth and investments in strategic technologies compared to China and the US is concerning to European leaders.
To address these challenges and make Europe more competitive, there is a call for introspection and increased investment in the future. Timo Vuori emphasizes that Europe needs to invest in productivity and new technologies to remain competitive. A full discussion on how to improve Europe’s competitiveness can be found in attached video links.
