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European business chiefs warned on Tuesday that the region risks falling behind its American and Asian counterparts if it fails to innovate and adapt to a rapidly changing world that is expected to see an acceleration of global policy changes during the second mandate of President Donald Trump. .
Europe “was always behind” its counterparts in Asia and the United States in innovation, said Mario Greco, executive director of Insurance in Zurichhe told CNBC from the World Economic Forum in Davos, Switzerland.
“In a world that moves very quickly, with a lot of innovation, it is once again a wake-up call for Europe. And I hope that Europe takes it seriously,” Greco said.
“Take all the advances in AI (artificial intelligence) and digital. Europe has not invested in that, as the United States and China have. So is the integration of financial markets in Europe. It is still (a question of) how It is complicated. It is doing business in Europe… And that is why I repeat it: Europe needs to wake up,” Greco added.
Greco added that Europe had become too concerned with regulation and that it was stifling progress, particularly in the new technologies needed to drive growth, and as we enter the Trump 2.0 era of “America First” policies, meaning that the region will need to defend its economic interests even more.
President Donald Trump signed a large number of executive orders on his first day in office on Monday, including withdrawing from the Paris climate agreement and repealing the 50% electric vehicle target, as well as measures to crack down on immigration.
On the global front, in addition to stating that 25% tariffs could be imposed against Mexico and Canada as early as FebruaryTrump also sent a warning signal that the European Union needed to buy more American products, in addition to oil and gas, or it would be targeted by tariffs.
Novartis CEO Vas Narasimhan told CNBC that the Trump 2.0 era was “a great moment for Europe,” during which the region needs to deregulate and boost competitiveness.
“Europe has to decide now, in a world where the United States is deregulating so much and trying to increase competitiveness, is it going to continue to sit idly by, continue to increase regulation in the (European) Commission, increase regulation in the different from each of the countries, or are we finally going to achieve in Europe an environment more favorable to competition and innovation?” he asked.
“We will have to see. History suggests that, although there is a lot of talk, the (European) Commission does not take many measures. And right now, this is the moment. Because, if not, I think Europe will fall even further behind the United States. United,” he said.
Boost competitiveness
European authorities seem to be aware of the urgent need to innovate and deregulate in the face of growing competition and economic rivalry from the United States and China.
“The new Trump administration should be a wake-up call for Europe,” Belgian Finance Minister Vincent Van Peteghem reported on Monday Reuters. “Instead of focusing on retaliation (against US tariffs), we should focus on Europe’s challenges: the declining competitiveness and growing productivity gap we face,” he said.
ING CEO Steven van Rijswijk said Europe needs more simplified and harmonized regulation across the bloc to boost competitiveness and labor productivity, a growing problem for the continent. He noted that more investments were also needed.
“There are a lot of investments that need to be made in infrastructure, a lot of investments that need to be made in Europe’s strategic autonomy when it comes to technological infrastructure, those are the things that need stimulus,” he told CNBC. outside the WEF.
During a panel discussion on the future of growth, Banco Santander CEO Ana Botín said governments need to develop frameworks to drive growth “in the right way, with redistribution (and) thinking about what AI means “.
“We are not a museum,” he said of Europe. “We run the risk of becoming a museum. But who develops the latest vaccines? Much of the innovation is actually happening in Europe. We have a lot of startups, the problem is that they start here and then go to the United States. Joined. “.
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— CNBC’s Karen Gilchrist and Chloe Taylor contributed reporting to this story.
