Let's kick off with a quote...
"The British took risks by financing the private sector. The Americans took risks. We don't know how to do that yet,"
Those are the words of Michel Barnier, acknowledging that there were 'lessons to be learned' from the EU's handling of the vaccine rollout.
He was feeling chatty...
"an almost ideological mistrust of public-private partnerships"
"It is true that there were mistakes at the start - why? Because we wanted to decide for 27 and not on our own".
"It is easier to decide on our own, rather than as 27, especially since we didn't have that expertise in Europe.
"This is one of the lessons to be learned. Perhaps there are issues in Europe where it will be necessary to hand over the decision-making to the country, or to the region."
The pandemic laid the worst aspects of the EU bare, and there is a feeling that politicians are starting to pay attention. Soon they might even try to do something about it...
Macron (Dec 2020): the U.S. has the FAANGs and China boasts the BATX while the EU has its GDPR data-protection law
This has been the great irony of the EU, they can identify the problems, but implementing policies to solve them has been completely out of reach...
They became world-leading regulators and 'consumer protectors', but forgot to protect the innovative firms from foreign takeovers...
That problem seems to have been addressed, and the EU has just proposed regulation to address distortions caused by foreign subsidies in the Single Market (aimed primarily at China).
Now comes the bigger challenge of lifting the bureacratic handcuffs and developing the kinds of companies foreign firms might actually be interested in acquiring...
The updated industrial strategy is still light on details, although the commission plans to double chip production to at least 20% of world supply by 2030.
Reality is dawning on the EU, but will they actually do anything to fix it?
The historic agreements brought about by the pandemic (once finally ratified) will provide unprecedented funding.
This segment sums up the challenge ahead:
Cash is important, but so are the conditions that foster the innovative “ecosystems” the EU sorely lacks.
According to entrepreneur Gilles Babinet, who advises the French government, the four key criteria are:
Venture capital to fund ideas, universities to produce them, geographic clusters that attract deep-pocketed companies, and supportive politicians.
The EU is trailing in most of these areas: Its universities struggle to retain top talent, its venture capital pool is relatively small, and even with a new crop of billion-dollar startups there’s nothing to rival the likes of California or Shenzhen.
Top-down policies are there, but not the seeds on the ground.
Can the EU learn to take risks or are they doomed to continue the current path of sluggish growth & minimal innovation which produces such undesirable outcomes as persistently high youth unemployment?
If they can't change course now... when will they?
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