by Luigi Gambardella

On Jan. 29, the European Commission unveiled its ambitious program to address the EU's declining competitiveness relative to other major economies, such as the United States and China.

Titled "Competitiveness Compass for the EU," the program outlines the Commission's overarching strategy for enhancing the EU's economic competitiveness during the 2024-2029 legislative term. It places particular emphasis on innovation, the green transition and strategic autonomy. The initiatives listed in the program will be further detailed as their respective implementation dates approach, with additional specifics expected in the Commission's upcoming 2025 work program.

The implementation of the program over the coming five years will open significant opportunities for Chinese companies. For example, the advocated measures to remove remaining trade barriers within the single market, aimed at facilitating intra-EU cross-border trade and reducing energy costs, could potentially benefit Chinese companies operating in Europe and EU companies with Chinese investment.

In this framework, the European Commission also intends to make standard-setting processes faster. Another initiative is the announced EU Start-up and Scale-up Strategy, which aims to improve relations between universities and businesses and create better prospects for patents to be commercialized.

SHARED INTERESTS: INNOVATION AND TECHNOLOGY

The EU's efforts to bridge its persistent productivity growth gap present fertile ground for collaboration with China, a global leader in cutting-edge fields such as artificial intelligence (AI), 5G and the Internet of Things. Joint initiatives in these areas could allow both sides to harness their complementary strengths: China excels in rapidly commercializing new technologies, while Europe provides a highly regulated and ethics-driven approach to innovation.

Europe's proposed Data Union Strategy offers promising opportunities for strategic partnerships with Chinese companies, given that high-quality and large-scale data is a crucial asset in AI development -- an area where Chinese firms generate vast and valuable datasets.

Industry leaders like Tencent and BYD, with expertise in building complex technological ecosystems, could contribute their knowledge and investments. In return, China could learn from Europe's expertise in data security and ethical regulation, enhancing the global credibility of its technological products.

GREEN TRANSITION, A BRIDGE FOR COOPERATION

The Competitiveness Compass for the EU envisions Europe as a hub where future green technologies, sustainable services and clean products are conceived, manufactured and brought to market, positioning it as the first continent to achieve climate neutrality.

The EU remains committed to reaching climate-neutral by 2050. In the face of the challenge, collaboration in renewable energy sectors, such as solar power, green hydrogen and energy storage technologies, presents a unique opportunity for both Europe and China. As the global leader in solar panel and battery production, China could work with European companies to accelerate the deployment of these technologies within the EU.

Besides, the forthcoming future Circular Economy Act is expected to provide opportunities for joint ventures in waste management and advanced recycling technologies, areas where China has already made substantial investments. Sharing best practices and technologies could boost global sustainability efforts while strengthening bilateral ties.

A PARTNERSHIP FOR GLOBAL CHALLENGES

Global challenges like climate change, geopolitical instability and digital transformation cannot be addressed in isolation. Recognizing this, the Competitiveness Compass for the EU underscores the importance of global partnerships the EU has cultivated, highlighting their essential role in the program's success.

China and the EU share a global responsibility to shape a sustainable future. Collaborating on international norms for digital trade, AI regulation and sustainability standards could position both as leaders in a more equitable and inclusive economic order.

The Competitiveness Compass for the EU should thus be seen not only as a roadmap for Europe's economic revitalization but also as an invitation to deepen global partnerships. For Chinese enterprises, it presents an opportunity to expand collaboration with European universities, establish joint ventures and pursue greenfield investments based on shared interests and mutual benefit.

By leveraging their respective strengths and overcoming mutual skepticism, Chinese and European businesses can build a bridge toward a more sustainable, innovative and prosperous future. As the 50th anniversary of EU-China diplomatic relations approaches, the moment is ripe for fostering a deeper and more dynamic partnership for the decades ahead.

Policymakers, businesses and academic institutions must work together to capitalize on their shared strengths, ensuring long-term progress and mutual benefit. When the two major economies join forces to address global challenges, we can drive transformative change and inspire a model of cooperation that benefits not just our own societies but the entire world.

Editor's note: Luigi Gambardella is the president of ChinaEU, a non-profit international association to foster public-private partnerships, business cooperation and joint investments in digitization processes and high-tech fields by European and Chinese companies.

The views expressed in this article are those of the author and do not necessarily reflect the positions of Xinhua News Agency.

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