Geopolitical tensions, high energy costs, below-average growth, great uncertainty: Europe is currently facing major challenges. In order to remain competitive in the future, Europe must be strengthened as a business location. But what does this require? This question was the focus of the Austrian Federal Economic Chamber’s business symposium “12 Minutes Europe – Meeting Global Challenges” on 08 April 2024 in Vienna. At the event, renowned experts discussed the future of the European economy. Prognos Chief Economist Dr Michael Böhmer joined Karl-Theodor zu Guttenberg, former Federal Minister of Economics and Technology and Defence, Markus J Beyrer, Director General of BusinessEurope, Ulf Poschardt, Editor-in-Chief of WeltN24 and Véronique Willems, Director General of SME United on the panel “Locating Europe’s economic competitiveness.” Against this backdrop, Prognos analysed in an accompanying paper what Europe needs in order to remain globally competitive. Below-average growth and productivity in Europe According to our forecasts, growth in the EU countries will be significantly lower than in China or the US by 2030. This means that the gap in per capita income compared to the US will continue to widen, with China catching up in relative terms. Labour productivity has also been declining for many years. In order to keep up internationally in the future, Europe must reverse this trend. Europe’s five major challenges These are the five major construction sites for increasing growth potential in Europe: Investment: Compared to China and the US, little is invested in the EU. In order to master the challenges of the dual transformation – digitalisation and decarbonisation – and not lose competitiveness, substantially higher investment will be required. Energy costs: Energy costs in the EU are significantly higher than those of competitors. Competitive energy prices require a massive expansion of renewable energies. Bureaucracy: Regulations are an obstacle to investment for six out of ten companies in the EU. Scrutinising existing regulations can be a tangible lever to promote investment and growth. Labour market: People work less in the EU than elsewhere. Incentives to increase employment are an important lever for securing skilled labour and thus improving competitiveness. Innovation: The EU is becoming less important as a centre of innovation, measured by its share of global patents. In order to reverse this trend, higher and efficiently utilised funds for research and development are required. Links and downloads To the paper (PDF, in german) To the Interview with the austrian austrian daily newspaper Kurier (in german, Paywall) More information about the event (Website WKÖ, in german) Do you have questions? Your contact at Prognos Dr Michael Böhmer Chief Economist, Head of Corporate Services View profile About us Prognos – Providing Orientation. Prognos is one of the oldest economic research centres in Europe. Founded at the University of Basel, Prognos experts have been conducting research for a wide range of clients from the public and private sectors since 1959 – politically independent, scientifically sound. Learn more