In brief
Von der Leyen has announced a new roadmap called the Competitiveness Compass, to generate growth opportunities, while leading the charge towards climate neutrality, in the EU over the next five years. The EU Commission is seeking to simplify and streamline its laws, weigh costs and benefits of new rules.
- At Davos 2025, European Commission President Ursula von der Leyen announced a new roadmap for the EU.
- The Competitiveness Compass, based on recommendations from the economist Mario Draghi, identifies the actions needed to boost the EU’s competitive standing on the global stage.
- The Compass focuses on three core areas: innovation, decarbonization and security.
“Europe is open for business.”
Ursula von der Leyen, President of the European Commission
What is the Competitiveness Compass?
Based on a series of recommendations from Mario Draghi, the economist and former Prime Minister of Italy, the Competitiveness Compass identifies the actions needed to boost the EU’s competitive standing on the global stage. “It is a strategy to make growth faster, cleaner and more equitable, by ensuring that all Europeans can benefit from technological change,” said von der Leyen.


The Compass outlines three core action areas: innovation, decarbonization, and security.
1. Innovation
The EU aims to close the innovation gap by investing in sectors like artificial intelligence (AI), biotechnology and space technology. Specifically, it plans an EU Start-up and Scale-up Strategy to encourage new companies to emerge and flourish.
2. Decarbonization and competitiveness
“Getting back to low and stable energy prices” is von der Leyen’s aim. To achieve that, the Commission is introducing an Affordable Energy Action Plan, which will take a competitiveness-driven approach to decarbonization via its forthcoming Clean Industrial Deal. Energy-intensive sectors like steel, metals and chemicals will also be a focus.
3. Increased security and resilience
For the past 25 years, Europe has relied on global trade to drive its growth, and outsourced its own security, said von der Leyen. But the global scene has radically shifted, and the EU will now reduce its dependencies – for instance on fossil fuel from Russia – while building new trade partnerships to “secure a supply of raw materials, clean energy, sustainable transport fuels and clean tech from across the world”. The EU has already forged new partnerships with Switzerland, Mercosur and Mexico.
“The world is changing,” she said. “So must we.”
Ursula von der Leyen, President of the European Commission
Innovation
Innovation is a key priority, with the Commission aiming to close the innovation gap by fostering start-ups and promoting industrial leadership in emerging technologies. As part of this effort, the Commission will introduce initiatives like ‘AI Gigafactories’ and action plans for biotech, robotics, and quantum technologies. Additionally, the Compass will propose a 28th legal regime to simplify rules and foster growth for innovative companies across Europe.
With the Compass, the Commission presents its economic doctrine for the next five years. This doctrine is simple and can be summed up in one key word: competitiveness. Competitiveness in every euro that we will spend, and in every initiative we will propose. From this ambition comes a threefold work program: simplify, invest, and accelerate on our economic priorities. The compass must signal a change of mindset for Europe and Europeans. It makes Europe more predictable, while maintaining the course of our European model – decarbonised, social and respectful of our values.
Stéphane Séjourné, Executive Vice-President for Prosperity and Industrial Strategy
Decarbonization
On decarbonization, the Compass emphasizes the need for affordable clean energy. The upcoming Clean Industrial Deal will focus on making Europe an attractive location for clean manufacturing and energy-intensive industries.
An Affordable Energy Action Plan will work to reduce energy prices, while an Industrial Decarbonisation Accelerator Act aims to streamline permitting for sectors undergoing transition. “The world will need to produce hundreds of millions of tonnes of biochar for carbon sequestration in order to have a climate-relevant impact,” said Madhur Jain, CEO of Varaha, underscoring the importance of decarbonization in global competitiveness.
Security
Finally, the Compass aims to reduce Europe’s excessive dependencies on external resources, strengthening supply chains through global partnerships. With a review of public procurement rules, the Commission plans to introduce European preferences for critical sectors and technologies.
The five horizontal enablers, including simplification of regulations and improved coordination between EU and national policies, will ensure that these goals are met efficiently. The initiative marks a major step towards Europe’s future-proof economic strategy, with von der Leyen concluding, “What matters is speed and unity. The world is not waiting for us.”