The European Commission's Communication, titled A Competitiveness Compass for the EU, presents a comprehensive plan to revitalise Europe's competitiveness and ensure sustainable prosperity. It acknowledges that while Europe possesses fundamental strengths—such as a skilled workforce, a stable legal environment, and a robust Single Market—it faces structural challenges, including lagging productivity and innovation compared to global rivals like the United States and China.

To address these issues, the Commission proposes a competitiveness model centred on innovation-led productivity, sustainable growth, and economic security. The strategy identifies three transformational imperatives: closing the innovation gap, advancing a joint roadmap for decarbonisation, and reducing excessive dependencies to enhance resilience. It also focuses on enabling factors such as regulatory simplification, access to capital, upskilling, and coordinated EU-national policy frameworks.

Flagship initiatives include a Start-up and Scale-up Strategy, a European Innovation Act, an Affordable Energy Action Plan, and a Clean Industrial Deal. These initiatives aim to support high-growth sectors including AI, biotech, quantum computing, and advanced manufacturing. The strategy underscores the importance of trade, economic security, and digital transformation, while safeguarding Europe’s social market economy and strategic autonomy.

This blueprint for action is intended to guide the EU’s work over the next five years, aligning institutional and national efforts to boost innovation, investment, and inclusive growth, and to secure Europe's place in a rapidly changing global landscape.