European Commission President Ursula von der Leyen is spearheading a significant push to bolster the European Union’s economic competitiveness by advocating for a stronger, more integrated single market and a drastic reduction in regulatory burdens. Amidst growing global economic uncertainty and strategic rivalries, von der Leyen emphasizes that “business as usual” is no longer an option for the bloc.
Von der Leyen has warned that diverging national rules and trading conditions across EU member states are hindering businesses and undermining Europe’s overall competitiveness. In a letter to national leaders, she stressed the need to remove these internal barriers to support the bloc’s drive for independence in an era defined by “raw power, strategic rivalry and the weaponisation of dependencies.”
As part of her agenda, von der Leyen is committed to a new drive against EU bureaucracy. She plans to present a report to leaders detailing progress in cutting red tape, acknowledging that companies often spend as much on bureaucracy as on research and development. This initiative aims to simplify regulations at both the EU and national levels, addressing issues like “gold-plating” – the extra layers of national legislation that create new barriers.
Recognizing the critical need for capital for European companies, von der Leyen is calling for a simplification of the EU’s capital market. She described the current system as “fragmentation on steroids,” contrasting it with the more unified financial systems in the United States. The goal is to create “one large, deep and liquid capital market” to boost the bloc’s competitiveness and facilitate scaling up for businesses. The Commission is proposing measures to create a savings and investment union, with von der Leyen indicating a willingness to pursue “enhanced cooperation” among willing member states if full agreement proves elusive.
While the European Commission has been pushing a deregulation agenda, von der Leyen also pointed out that member states bear responsibility for regulatory complexity. She highlighted examples of national rules that complicate cross-border trade and transport, noting that simplification proposals often get stalled in negotiations between EU countries and the European Parliament. She lamented that the EU has significantly more trade barriers than the U.S., stating, “We have the second-largest economy in the world, but we are driving it with the handbrake on.”
Looking ahead, von der Leyen is set to present a competitiveness “roadmap” to complete the EU single market by 2028. This roadmap will include commitments to adopt key proposals by the end of 2027. She also supports a “European preference” for public procurement in strategic sectors to strengthen the continent’s production base, while cautioning against a rigid “one-size-fits-all” approach. The EU also aims to diversify trade ties and expand its network of reliable partners through new trade agreements.