Speed, simplicity and focus: How the EU can make a success of the competitive sustainability ‘race to the top’

(EurActiv, 22 Dec 2022) The US Inflation Reduction Act may have done the EU a favour, leading it into a possible international partnership to increase the speed, simplicity and focus of its industrial innovation and investment strategy, write Martin Porter and Peter Sweatman.

Martin Porter is the executive chair of the Cambridge Institute for Sustainability Leadership (CISL) in Brussels. Peter Sweatman is Chief Executive of Climate Strategy & Partners and co-chair of the Breakthrough Energy Innovation Hub.

Whisper it, but the US Inflation Reduction Act (IRA) might actually have done the EU a big favour.

You might not guess this from recent headlines citing EU-US tensions over inconsistency with WTO rules and the impact on Europe’s own industries, and the IRA has certainly landed at a time when industries are dealing with multiple stress factors, including high energy prices, and the massive incentives on the table make the US highly attractive as an investment opportunity.

But if it leads to the EU increasing the speed, simplicity and focus of its own industrial innovation and investment strategy, it could enhance the EU’s competitive sustainability and kick-start a race to the top.

That said, it’s questionable how much appreciation of the game-changing potential of the EU’s current strategy and its understanding of the new levers for competitiveness European leaders showed during the last EUCO meeting.

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EurActiv, 22 Dec 2022: Speed, simplicity and focus: How the EU can make a success of the competitive sustainability ‘race to the top’