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Europe needs a new investment plan

Next Invest EU?

[This editorial is also available in Ukrainian.]

Instead of complaining about the measures taken by the United States to support investment in new clean technologies, Europeans would do better to come up with an identical plan.

Faced with an energy crisis that began long before the war in Ukraine, European industry is in danger of relocating on a massive scale in the face of rising costs. Yet Europe is struggling to agree on a cap on the price of electricity.

The lesson learned from Covid is that the first bad national responses were quickly tempered by wisdom and reason. Europeans agreed on an €750 billion recovery and support package which, combined with the ECB's accommodating policy, saved the European economy.

We need the same response today. We face the same challenge.

To sustain and boost growth, it is time to focus on the single market, domestic demand and investment. Otherwise, the continent will experience its 4th recession in 15 years.

This requires a monetary policy that does not copy that of the US FED and an ambitious common fiscal policy for recovery, aimed more at autonomy.

In 1950, the European Community was born of a common energy policy. At that time, coal and steel were essential for rebuilding a shattered Europe. It is still energy - electricity, gas and oil - that largely determines our industrial competitiveness; it is digital investments that are preparing tomorrow's achievements.

There is still time for Europe to change its approach. Public investment is back. It is essential to mobilise all available resources, including private ones, so that we can face the unexpected challenges that have been thrown at us and the extraordinary technological shifts that await us.

Ordo-liberalism is dead and we must accept to see it buried, without regrets or remorse.

The European Union must launch a major investment plan to cap the price of electricity and subsidise critical industries. Energy, security-defence and digital technology are priorities on the European agenda.

And the Union should not be afraid to go into debt together to finance at least 3% of its GDP, i.e. around €500 billion, about the same as the American authorities are mobilising to support the conversion of their economy. 

When will we see a new "Next Invest EU" plan?