Supporting Europe’s new phase of re-industrialisation

This paper addresses the pivotal role that manufacturing activities play in the European economy and the difficulty that Europe faces to maintain a strong industrial base. That role has been subject to a resurgence of interest for already a number years and has resurfaced at the top of the policy agenda. There are several reasons for this. First, the crisis brought out the vulnerability of the European industry into the open and accelerated on-going trends. Second, the crisis highlighted some major economic imbalances. In particular, the risks associated with a high reliance on the financial and service sectors. Against this backdrop, EU policy makers have started to re-consider the role of manufacturing activities and to recognise the decline of manufacturing production in Europe as a matter of concern. Along this line, a new rhetoric has spread all over Europe. For instance, the European Commission has highlighted the key role of manufacturing to underpin the recovery of growth and jobs and to address societal challenges. In order to cope with such challenges, this paper proposes three strategic choices: (1) the promotion of new business models; (2) the creation of industrial eco-systems through systemic innovation; and (3) the support for a genuine European value chain, which together could stimulate a new phase of re-industrialisation in Europe.