On September 9th, Mario Draghi, former prime minister of Italy and former president of the European Central Bank, presented his long-awaited report, “The future of European competitiveness”, ordered by the president of the European Commission Ursula von der Leyen. This publication came a few months after Enrico Letta, another former Italian prime minister, presented his report, the Letta report, that proposed deep changes to the European Union (EU) internal market.
In a nutshell: the report is presented as a strategy to reform the European economic model.
This report, also called “the Draghi report”, outlines the challenges and opportunities for the EU to strengthen its economic position while promoting sustainability. It emphasizes the need for a radical transformation of European industry, energy systems, and governance frameworks to address long-standing competitiveness issues while aligning with climate goals. According to Mario Draghi, the EU now faces three key challenges:
- A lack of competitiveness versus the United States and China,
- A difficult harmonisation of decarbonisation with competitiveness and across member States,
- A need to enhance economic security by reducing dependencies.
Proposals mainly focus on curbing EU carbon emissions without compromising its competitiveness.
Four main areas are covered by the report:
- Energy Transition: companies should prepare for a shift in energy pricing and supply. The report suggests promoting long-term contracts for renewables and encouraging self-generation of power. This aligns with the broader European strategy to reduce energy costs and reliance on fossil fuels, crucial for firms exposed to high energy prices.
- Innovation and Sustainability: Draghi calls for fostering innovation within companies, particularly in energy, infrastructure, and clean technologies. Companies should focus on decarbonization strategies like hydrogen energy, green gases, and carbon capture.
- Regulatory Streamlining: Businesses, particularly SMEs, are urged to benefit from the proposed reduction of administrative burdens related to sustainability reporting. Simplifying compliance with the EU’s regulatory framework (e.g., CSRD) is a core proposal, which could ease pressure on companies, allowing them to focus on achieving sustainability targets.
- Supply Chain Resilience: Building robust, localized supply chains and securing access to critical raw materials are highlighted as essential for maintaining competitiveness in a global market. Companies should consider investing in more resilient, circular supply chains that reduce waste and environmental impact.
However, this is a report on competitiveness, not on sustainability
The central premise of the report is to boost Europe’s global competitiveness through significant economic investment—around €800 billion annually—targeted at reindustrializing Europe and supporting high-growth sectors like clean technology, energy infrastructure, and innovation. While sustainability is emphasized, the goal remains one of expanding production, job creation, and economic output, reinforcing the growth paradigm. Sustainability, by contrast, seeks to reduce material and energy use, which conflicts with the report’s call for economic expansion.
Neglecting overconsumption, Draghi misses the main point of sustainability
The Draghi report largely overlooks the issue of overconsumption, which is a key tenet of sustainability thinking. It assumes that Europe’s economic prosperity can be sustained or even improved through technological solutions and better regulation, without questioning the overall levels of production and consumption. Sustainable development perspectives argue that technological fixes alone cannot address ecological crises if consumption patterns remain unsustainably high, as this leads to continued resource depletion and environmental stress.
The problem of this report is that it considers sustainability as a tool to increase competitiveness
In Draghi’s framework, sustainability measures – like transitioning to renewable energy, reducing carbon emissions, and enhancing energy efficiency – are framed as tools to increase Europe’s economic competitiveness, rather than ends in themselves. For example, recommendations to decarbonize industries and invest in clean technologies are largely aimed at reducing energy costs and boosting industrial productivity. This contrasts with a sustainable development approach, which prioritizes lowering consumption, ecological footprints, and the depletion of natural resources, regardless of competitiveness.