Ursula von der Leyen, President of the European Commission, reaffirmed Europe’s commitment to the Paris Agreement and outlined plans for the EU’s economic and environmental priorities in response to shifting global dynamics.
Speaking at the World Economic Forum in Davos, Von der Leyen stressed that the Paris Agreement remains “humanity’s best hope” for combating climate change, following the United States’ decision to withdraw from the accord.
Paris Agreement: A Non-Negotiable Principle
Von der Leyen’s remarks came in the wake of US President Donald Trump’s executive order, signed shortly after his inauguration, to withdraw the United States from the Paris Agreement. The accord, established in 2015, commits nations to limiting global warming to 1.5 degrees Celsius above pre-industrial levels. Trump’s policy pivot included promoting fossil fuel exploration, marking a significant departure from global climate cooperation.
Von der Leyen criticised this approach, citing recent climate events such as the Los Angeles wildfires as evidence of the urgent need for action. “It is impossible to ignore the impact of climate change,” she stated. Emphasising Europe’s leadership role, she pledged continued collaboration with nations committed to addressing the climate crisis.
Negotiations with the US: Pragmatism with Principles
In response to Trump’s threats of imposing tariffs on EU imports, Von der Leyen expressed willingness to engage in dialogue but underscored that the EU would remain steadfast in upholding its principles. “Our priority is to act early, discuss shared interests, and be ready to negotiate. We will be pragmatic, but we will always protect our interests and uphold our values – that is the European way,” she asserted.
Von der Leyen also signalled a readiness to address trade imbalances with China, emphasising the importance of building a fair and reciprocal relationship. She highlighted the necessity of maintaining constructive engagement while addressing challenges posed by global economic competition.
A New Five-Year Plan for Europe
Looking ahead, Von der Leyen previewed the European Commission’s five-year strategy aimed at restoring industrial competitiveness and addressing disparities in growth and innovation between Europe and the United States. Central to this plan is the establishment of a European Savings and Investment Union, designed to mobilise the continent’s €1.4 trillion in savings. Fragmentation in the European capital market currently hinders the flow of funds into emerging technologies, with €300 billion annually leaving the EU for investments abroad.
“We do not lack capital,” Von der Leyen noted. “What we lack is an efficient capital market that channels savings into promising new technologies.”
To foster innovation and ease business operations, Von der Leyen announced plans to simplify regulations related to financial, social, and environmental sustainability. She proposed pan-European rules for corporate, labour, and tax law to replace the existing patchwork of national regulations. This initiative aims to eliminate barriers to scaling businesses across Europe, leveraging the continent’s size as a competitive advantage in a global market dominated by economic giants.
Pursuing Energy Independence
Energy independence also features prominently in the Commission’s agenda. Von der Leyen highlighted renewable energy as a medium-term solution, citing its cost-effectiveness, job creation potential, and contribution to Europe’s autonomy. She emphasised the need to invest in clean technologies such as nuclear fusion, geothermal energy, and solid-state batteries.
“Renewable energy strengthens our independence and provides long-term economic benefits,” she said.
Strengthening Trade Ties
Amidst escalating trade tensions and protectionist measures, the Commission intends to prioritise new trade agreements. Von der Leyen announced her first trade mission would be to India, signalling the EU’s intent to deepen economic ties with key global partners. Constructive collaboration with China remains on the agenda, with Von der Leyen advocating for a balanced relationship rooted in fairness and reciprocity.
Europe’s Strategic Vision
Von der Leyen concluded her address with a strong statement of Europe’s resolve to navigate growing geopolitical rivalries. “This is not only an economic necessity,” she said. “It is Europe’s message to the world. It is Europe’s answer to growing rivalry.”
The Commission’s full roadmap for the next five years is set to be unveiled next week, providing a detailed blueprint for addressing the challenges and opportunities facing Europe in a rapidly changing global landscape.