The subject of the EU’s competitiveness is once again on the agenda of the EU’s heads of state or government on Thursday 23 October. This should continue to be the case at future European Councils, and an informal summit dedicated to this subject is expected to be held in February 2026, according to a European diplomat. The EU27 are largely in agreement on the areas of simplification, industrial policy and trade. On the other hand, the issue of the EU’s climate objectives, which is part of the competitiveness debate, is crystallising tensions to a greater extent.
On Thursday morning, prior to the summit, several countries, including Belgium, Luxembourg, Germany and Austria, will be taking part in a lunch on the theme of competitiveness and the green transition.
2040 target. No formal agreement on the target of reducing EU emissions by 90% by 2040 is expected at the end of the European Council, as it would require unanimity, and some countries, such as Hungary, reject the target as such. Italian Prime Minister Giorgia Meloni also explained that her country would not be able to support the 2040 target without “a major overhaul” of the European Green Deal.
The heads of state or government should simply provide guidelines, which will then enable the environment and climate ministers to resume negotiations and agree on the target.
International carbon credits. In a draft set of conclusions dated 21 October, published by Agence Europe, the European Council also makes no mention of a final percentage for the contribution of international carbon credits to the EU’s emissions reduction target, which would allow the 2040 target to be reached more flexibly, according to the European Commission. The leaders are expected to just call for “an adequate level of high-quality international credits” to finance decarbonisation projects abroad.
The conclusions also mention a “realistic” contribution of “carbon removals to the overall emission reduction effort”.
In addition, the EU Council could agree on the need to include “a revision clause” in the European Climate Law “in light of latest scientific evidence, technological advances, and evolving challenges to the EU’s global competitiveness”.
ETS2. Several countries are waiting for concrete guarantees from the Commission on the revision of CO2 emission standards for light vehicles (see EUROPE 13735/3) and the revision of the framework for extending the Emissions Trading System to the road transport and buildings sectors (ETS2).
This last point is taken up in the EU Council’s draft conclusions, inviting the Commission to present a revision “including all relevant aspects”.
On Tuesday, the European Commissioner for Climate, Wopke Hoekstra, presented to the environment ministers in Luxembourg a series of measures envisaged to address the concerns of a majority of Member States (see EUROPE 13735/1).
Simplification - 19 Member States are calling for a “cultural change” in the way rules are drawn up. Ahead of the summit, a group of 19 Member States, led by Germany, sent a letter to the President of the European Commission, Ursula von der Leyen, calling for a paradigm shift in simplification.
For them, the revision of texts with a view to simplifying them must become systematic: “This requires a constant stream of Omnibus proposals from the European Commission throughout its term of office”, write the 19 heads of state or government.
In general, they advocate reducing legislation, “the dismantling of outdated rules”, and combating “the proliferation of delegated and implementing acts”.
What’s more, the co-legislators in the Council of the EU and the Parliament must strive to adopt the texts much more quickly, according to the 19 countries that signed the letter.
To see the letter: https://aeur.eu/f/j3d
Economic security. Several countries are expected to raise the issue of economic security at the European summit, in light of recent export restrictions imposed by China on rare earth technologies, which are affecting European supply chains.
The subject is briefly mentioned in the draft conclusions of the leaders, who are expected to invite the Commission to “make full use of the EU’s economic security instruments”.
To see the draft conclusions dated 21 October: https://aeur.eu/f/j2w (Original version in French by Léa Marchal and Pauline Denys)