EC President Ursula von der Leyen gave a keynote address in Brussels on Tuesday at a high-level conference reviewing progress since the publication – a year ago – of the influential Draghi report. Her speech was followed later by Mr Draghi’s own.
Ms von der Leyen’s address provided an overview of the Commission’s position on the report’s recommendations and highlighted the EU’s response over the past 12 months. Critics charge the EU has been sluggish in adopting many of the former banker’s competitiveness recommendations, something he himself attested shortly after. Still, Ms von der Leyen insisted the bloc was headed in the right direction and that there were many changes that co-legislators and the executive were getting right.
It was only a few weeks ago that the former head of the ECB – and author of the report – Mario Draghi himself criticised the EU for dragging its feet, making the Commission president’s job of persuasion that much harder. Ms von der Leyen addressed the issue by highlighting concrete success stories.
Take Lovable, the Swedish AI app… Last summer it became the fastest software company in history to reach 100 million dollars in annual revenue. – Ursula von der Leyen, President of the European Commission
Now more than ever, urgency
Citing the Competitiveness Compass, Ms von der Leyen said the Commission had hit the ground running, listing the Clean Industrial Deal, AI Gigafactories, the new State Aid Framework, the Affordable Energy Action Plan and more. “This is the urgency mindset we promised,” she said. “And we will relentlessly stay the course until we get all of it done.”
The president pointed to success stories, in line with Mr Draghi’s so-called three pillars: the innovation gap with the US and China, plans for increased decarbonisation and competitiveness, and a reduction in dependency on external actors.
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Supercomputers
Ms von der Leyen argued that in these areas there was room for quick progress, with much still “up for grabs”. Supercomputers were her first case in point:
“Six years ago, we had two supercomputers in the global top 10 (…) Today we have four supercomputers in the global top 10. Our policies and investment in this field are starting to pay off.”
Lovable
Next, Ms von der Leyen described “the world of AI adoption”. According to the EC head, this time the EU was ahead of the curve:
“This time, Europe is not playing catch-up – we are among the frontrunners. European companies are top of the league on many AI applications.”
She described the impact of a single Swedish start-up not only as an inspiration but as an example of where Europe was making a difference.
“Take Lovable, the Swedish AI app. It turns anyone’s ideas into fully functioning apps or websites. Last summer it became the fastest software company in history to reach 100 million dollars in annual revenue. Today it is valued at almost €4bn (…) In 2025, the number of European businesses adopting AI has risen by 67% year-on-year. This is where we can truly engage in the race.”
This time, Europe is not playing catch-up – we are among the frontrunners. European companies are top of the league on many AI applications. – Ursula von der Leyen, President of the European Commission
The Gigafactories are coming
A third area she described in the first bloc were the EU’s own AI factories.
“We have created AI Factories and soon we will upgrade the best of them into Gigafactories. The aim is that our amazing innovative start-ups can access the computing power and test and train their models, especially thinking about sectoral applications.”
The president had said that she wanted to focus “on real impact on the ground”, including “good salaries for people and good profits for companies”. That means addressing outstanding issues.
Outstanding challenges
While she insisted the innovation gap could be closed, a huge issue that remains is completion of the European Single Market and internal obstacles which act as the equivalent of a 44 per cent tariff on goods and 110 per cent on services. That needs to change. As well, the EU needs improvements to decarbonisation and dependency, which are also of major importance.
Ms von der Leyen instead outlined where Europe could improve and make a difference.
She pointed to a bright future for EVs and to a shared commitment to the Clean Transition, which – she noted – the Global South wanted to see. Regarding dependency, she talked about diversification and reducing reliance on external actors while boosting European defence. She admitted this “wouldn’t happen overnight”, but said it had already started to happen, citing the 72 days it took to get the EU’s new defence funding scheme, SAFE, off the ground. This, she argued, was the kind of speed critics and supporters both had called for, prompting her to add:
“I am absolutely convinced that Europe can unite around this agenda. Every single Member State has endorsed the Draghi report. And so has the European Parliament. We all know what needs to be done. And business as usual does not work anymore.”
No mission accomplished – yet
The Commission president said, with pragmatism, that this was “no mission accomplished”, indicating that she understood the hard work that still lay ahead. In her final comments, she laid responsibility – as she did in her State of the Union speech – at the feet of the executive and co-legislative bodies together. Although she didn’t say so explicitly, she made clear it was constructive cooperation among the three that would be essential, along with stakeholder input, to speeding up delivery on the Union’s challenges and goals.
We all know what needs to be done. And business as usual does not work anymore. – Ursula von der Leyen, President of the European Commission
Mario Draghi weighs in
Appropriately, Mr Draghi himself delivered a keynote on the same subject. A year after releasing his landmark report on improving the EU’s competitiveness, he voiced frustration that progress had been sluggish, with only a fraction of his recommendations (383 in all) taken up. And he explained that numerous developments over the year had made the acceleration of improvements that much more urgent.
“Over the past year, each of these challenges has grown more acute. The foundations of Europe’s growth—expanding world trade and high-value exports— have weakened further. The US has imposed its highest tariffs since the Smoot-Hawley era. China has become an even stronger competitor (…) We have also seen how Europe’s ability to respond is limited by its dependencies—even when our economic weight is considerable.“
Mr Draghi said he had welcomed President von der Leyen’s decision to place competitiveness at the centre and called her programme “ambitious“ while still lamenting the slow speed at which issues were being addressed. He added:
“Too often, excuses are made for this slowness. We say it is simply how the EU is built. That a complex process with many actors must be respected. Sometimes inertia is even presented as respect for the rule of law. That is complacency (…) To carry on as usual is to resign ourselves to falling behind.“
Sometimes inertia is even presented as respect for the rule of law. That is complacency… A different path demands new speed, scale and intensity. – Mario Draghi, former head of ECB
Back to the future
The knock-on effect, he indicated, was growing frustration among citizens and companies. In effect, time is now of the essence and “It means delivering results within months, not years,” he said.
In that respect, Mr Draghi and President von der Leyen appear aligned—not only on the scale of the challenge, but on the need to act faster than the EU has before. The Commission, it seems, will have to move forward with a greater resolve than ever to make sure its programmes land solidly and begin making a real difference.
