News Desk
BUDAPEST: EU leaders on Friday pledged to overhaul the bloc’s economy, embracing a set of radical reforms proposed in a landmark report by former European Central Bank President Mario Draghi. The urgency of these reforms has intensified following Donald Trump’s victory in the U.S. presidential election, which has raised concerns in Europe about potential trade tensions and higher tariffs.
Although the public reaction to Trump’s return has been cautiously measured, EU officials are wary of the implications for the European economy if Trump follows through on his campaign threats to impose tariffs, particularly targeting the EU. Draghi’s report, first presented in September, stresses the need for the EU to address its lagging productivity and economic slowdown, particularly in comparison to the United States.
In his discussions with EU leaders, Draghi emphasized that the need for reform has become even more pressing in light of the new political landscape in the U.S. “What has increased is the urgency to deliver on the topics that are in this report,” said EU chief Ursula von der Leyen, echoing Draghi’s call for a European revival.
Draghi’s sweeping recommendations are aimed at modernizing Europe’s economy to ensure its long-term competitiveness. German Chancellor Olaf Scholz and French European Affairs Minister Benjamin Haddad both framed the moment as a “strategic awakening” for Europe, underscoring the need for fundamental changes to avoid “slow agony” for the bloc. However, internal challenges, such as political turmoil in Germany and divergent national interests, have raised doubts about the EU’s ability to implement the necessary reforms.
Von der Leyen, in her address, outlined her priorities for the coming years, focusing on reducing bureaucracy to make it easier for businesses to operate, as well as creating a savings and investments union to ensure that companies have access to the capital needed for innovation.
