Strong action needed to save Europe from economic decline

Orgalim's Director General Ulrich Adam shares his thoughts on the current economic situation of Europe's technology industries.

Europe's technology industries are bracing for a third consecutive year of decline in production and turnover. Growth has stalled in Europe – it was virtually non-existent during the start of this year and the outlook for the rest of 2025 is equally bleak.

We need to act now and we need to act decisively if we are to halt this economic freefall and preserve Europe's economic stability.

What can EU decisionmakers do to boost Europe's economy?

We are calling for decisive EU policy action to support the competitiveness of Europe’s technology industries and help improve the economic outlook in Europe. The actions that would most help Europe’s high-tech manufacturing companies are:

• Simplified EU regulation
• Reduced regulatory burden and costs for companies
• A long-term increase in R&I spending and
• Continued efforts to maintain an open trade policy that will help diversify supply chains and unlock new growth markets.

Orgalim's recent report on the burden caused by excessive and unnecessary regulation clearly shows how it is holding European industries back from being successful and competitive. Reducing regulatory burden would be an excellent place to start to help regain Europe's competitive edge.

Trade and investments this year will be significantly affected by tariffs set by US President Donald Trump. At this point, it's impossible to predict exactly how they will affect Europe and to what degree - suffice to say that it will be negative for all involved. It was already important the EU promote an open trade policy and conclude FTA negotiations swiftly, now it is imperative.

Reaching net-zero

The European technology industries that Orgalim represents are global leaders in the carbon-neutral energy, electrification and clean manufacturing technologies needed to get to net-zero. If Europe is to meet its net-zero targets, we need a competitive environment in which Europe's technology industries can flourish.

Our industries employ 11.6 million people across Europe and this would increase if the industries were enabled to grow. Unfortunately, however, employment in Orgalim industries has seen a steady decline over the past few years, with a 0.9% fall predicted in 2025, after a 1.2% fall in 2024.

Where next?

Europe stands at a crossroads. The political choices taken now can propel us along the path to a prosperous net-zero future. Or undermine the industries that are needed to power it. They can assert Europe’s open strategic autonomy or weaken it.

If political decisionmakers make the right moves now for a comprehensive competitiveness push, we can continue to lead the clean tech revolution and build a resilient, competitive and decarbonised European industrial base.