The European Union revealed plans on Wednesday to enhance the bloc’s economic security, aiming to protect sensitive technology from being obtained by global rivals like China. The move comes as Europe seeks to address economic vulnerabilities following the conflict in Ukraine and escalating global trade tensions. With the aftermath of the war in Ukraine resulting in energy supply challenges, the EU aims to prevent over-reliance on China, particularly in green technology production and critical raw materials.
The economic security package outlined by EU officials includes five initiatives, such as strengthening rules on screening foreign direct investment and initiating discussions on coordinating export controls. The EU sees these steps as crucial to maintaining competitiveness during the global shift to clean technology and to promote more production within Europe.
Margrethe Vestager, the EU’s senior competition official, emphasized the need for Europe to actively participate in economic competition, rather than just being a passive player. She stated that the proposed measures would help to reduce economic interdependencies and mitigate risks.
While some critics have claimed that the package has been watered down and that certain initiatives may be implemented too late, the EU officials refuted these claims. One of the initiatives involves revising the EU’s regulation on screening foreign direct investment, while others focus on promoting discussions to better support research and development of technologies with civil and defense applications. The EU also aims to have all member states establish screening mechanisms, which could potentially lead to the blocking of investments deemed risky.
Despite the EU’s push for economic security, it is crucial to strike a balance as investment and export control decisions are ultimately within the jurisdiction of individual member states. The commission must navigate these negotiations carefully to avoid overstepping its boundaries while achieving the intended economic security goals.
