European industrialists have called for a big increase in efforts to boost innovation as they fear a rise in protectionism and trade restrictions damaging the EU’s economy.
The rise in protectionism, most potently symbolised by the rise of Donald Trump as US President, has alarmed business leaders in the European Round Table of Industrialists.
Kurt Bock, chairman of chemicals giant BASF and a member of the group, said: “It is with great concern that we note a steady increase of potentially trade restrictive measures and a backwards trend in the integration of the European Single Market.”
Europe risks being left behind, the group said, if it does not invest in innovation. Growth across the Eurozone has stagnated since the global financial crisis, with 0.3 per cent recorded in the third quarter.
In the face of competition from growth economies such as China and India, Europe must invest to move up the value chain, the group said.
Bock said: “To adapt to these new developments Europe must increase efforts in the field of innovation, digitisation and strive for free trade and access to foreign markets.”
Foreign direct investment in 2015 was half the figure before the financial crisis in 2007, while GDP has failed to pick up to levels seen in 2009, according to the World Bank.
GDP growth has also been on a steady downward trend for decades – a problem common to many developed economies as the pace of productivity growth has fallen. Developing economies have been able to rapidly catch up, leaving the Europe’s industry vulnerable to increased competition if it does not invest.