EU Facing Loss Of Competitiveness, Italy's Draghi Warns

BRUSSELS, Sept 6 (Bernama-dpa) -- Former Italian Prime Minister Mario Draghi warned of a "rapid and sudden loss of competitiveness" for the European Union, an EU diplomat revealed on Thursday, reported German news agency dpa.

Speaking to EU diplomats on Wednesday, Draghi attributed the decline to high energy prices, skills shortages, and weak innovation capacity, causing the EU to lag behind its economic competitors.

Familiar reasons were identified by the former president of the European Central Bank (ECB) for the development, including the Covid-19 pandemic, the war in Ukraine, and inflation linked to both as well as rising energy prices.

EU countries did not identify this deterioration in competitivity as there was a kind of complacency according to Draghi, the EU diplomat said.

Another EU diplomat said however there was nothing really "out of the box" in the presentation but noted further information is set to come.

The European Commission called on Draghi to write the long-awaited report on the EU's economic competitiveness over a year ago with EU countries fretting increasingly about the bloc's economy.

The report is to inform a new strategy for economic competitiveness which is a priority for the second term of European Commission President Ursula von der Leyen.

While Draghi did not make proposals in his presentation, he did call for unprecedented cooperation between EU member states and reforms of the EU institutions.

The Draghi report, which is scheduled to be published next week, covers multiple sectors from capital markets to the defence industry as well as EU rules covering state aid regulation, according to EU diplomats.

--BERNAMA-dpa