My five points for the future of Europe

History reveals when we look back. But we are also witnessing a very recent historical development. The COVID-19 pandemic was and is a turning point for all of us. Within the European Union, I certainly value the fact that we have found a way to fight the crisis together and a pan-European recovery program has been launched in this spirit.

But our task in Europe goes far beyond that. It is not so much a matter of submitting public aid programs, but of generating a new dynamic and creating new prosperity.

Moreover, it’s not just about the immediate restart for Europe, but our medium-term perspective, our fundamental direction, our identity in the 21st century.

This is affected by the world we live in, the global and technological developments, but also by ourselves, our self-perception as Europeans, and our aspiration in a digital and decarbonized world. That's why I'd like to highlight a few thoughts what I believe is crucial for the future of Europe.

1)????A new view on systemic relevance

If we think about the professional groups that were literally in the front line working for us in the pandemic, we probably all see a clear picture. It was the nurses, doctors and medical workers in the hospitals. It was the salespeople in the supermarkets and, of course, all the companies that ensured the supply in production and logistics. At the same time, pharmaceutical research started right from the beginning, developing vaccines against COVID-19 in international collaboration and at record speed. Much of this historic work has happened in Europe.

I believe that this experience should teach us how fundamental medical care and food supply is. It is the basic prerequisite for everything else, including our freedom in our professional and private lives. I believe that the European Union should specifically strengthen the healthcare sector in the coming years. The progress and innovation in this field is crucial, given the growing demand for health care in an ageing population in Europe and many parts of the world.

It was during the global financial crisis more than ten years ago, when the term "systemic relevance" was established. It was used to describe financial institutions and not always in a positive way. In my view, the current crisis added another dimension to “systemic relevance”. And everyone involved in the health and food sectors should be aware of the huge responsibility that comes with it. ?

2)????Value creation in the age of the bio-revolution

In Europe, we have too many discussions on how existing prosperity can be distributed, and too few on how new prosperity can be created. We should change that. Value creation generally occurs where new solutions or products are generated through innovation. And this, in turn, happens at the connection between science, business and investments – together with an innovation-friendly regulatory environment. In such an ecosystem, the application of basic research can succeed, and entrepreneurial risks can lead to value creation, prosperity and jobs. In my view, we need more openness and support for innovation to create new value chains in Europe.

An innovative and competitive Europe is especially important because we are on the brink of a new era. Climate change and digitalization are not detached megatrends but influence each other and often digital technologies in particular drive new resource-saving solutions. In labs around the world, we are seeing tremendous scientific success. Advances in biology and artificial intelligence are merging in a way that experts call the bio-revolution. It offers the potential to profoundly change our understanding of health and nutrition.

3)????Moonshots for Europe – a new mindset for innovation

Giving the pressing global challenges we are facing, we need to think on a larger scale and in longer time horizons. And we must also be willing to take greater risks and direct our investments in innovation to address these challenges. This approach of a mission-oriented innovation system is supported by renowned experts such as the economist Mariana Mazzucato, but there are also private sector examples going in that direction. At Bayer, we founded an initiative called Leaps in 2016. It’s a dedicated unit to invest in potential breakthrough technologies to find solutions for some of humanity’s biggest challenges.

I hope to see more commitment to innovation in Europe. The basic idea of a mission has been undoubtedly taken up by the EU Commission. In connection with the EU Green Deal, Ursula von der Leyen repeatedly spoke about a “man on the moon” moment for Europe. However, this mission is apparently supposed to succeed without a special focus on innovation and research. In my view this would be critical. ???

4)????A market approach for the climate-neutral economy

In the climate debate, we have reached a crucial point: It’s no longer about the IF, but about the HOW. The science is clear: There is no alternative to the Paris Agreement and climate neutrality. Now it's about the concrete way to achieve this goal.

And one thing is clear to me: Decarbonization without innovation leads to deindustrialization. Preventing this should be our common political, economic and societal goal. Because if our industrial structures are dismantled here and built up elsewhere, little is gained for the climate, but much is lost for us, especially prosperity, value creation and jobs.

Our common opportunity is to show the world how the transformation to a sustainable economy can succeed, with green targets and profitable numbers – made in Europe.

That's why we need a market-based approach to reducing emissions and transforming business models. We need the right incentive systems, similar to what we have implemented at Bayer. And we need sustainable innovation, like in this example of the short corn.

5)????Driver for global collaboration

Not least in the pandemic, we have seen that protectionism and nationalism hinder our ability to act globally. At the same time, it harms us economically. The global collaboration of Europe is rooted not only in our values, but also in the economic interest of companies, employees and communities alike.

Openness to the world and global trade are in line with our fundamental convictions, but also with our business model. We sometimes seem to forget this.

That is why strengthening international organizations like the World Trade Organization or the World Health Organization is in Europe’s core interest.

For the global development, there is no better blueprint than the United Nations' 17 Sustainable Development Goals the global community agreed to in 2015. Looking at these goals, it is quite obvious that progress is urgently needed. The pandemic has led to devastating setbacks, for example in the fight against hunger and inequality in the world.

Europe must recognize its great responsibility and opportunity in contributing to the sustainable development and positive effects for the economies and societies at global scale. We should do our utmost to promote the development, including the technological development, in other, less developed parts of the world. To do this, we need to think bigger and not just look at ourselves. Global issues such as climate change or providing a growing world population with health and food are not questions for 80 million Germans or 400 million Europeans – but for eight and soon ten billion people around the world.

This content was part of a key note Werner Baumann gave on September 14th, 2021, at an event of the German-Italian Chamber of Foreign Trade.