Europe has yet to reveal if it will be seduced by the Italian Draghi act

The former Italian prime minister and central banker has written a strongly worded critique that is designed to shock EU decision-makers into action and reignite stagnating growth. And he pulls no punches blaming the failures of past policies on procrastination and a lack of co-ordination and cooperation.   

It is a long essay that reads more like a letter from a lost love, tinged as it is with sadness and regret.  

Europe, he says, is stuck in a static industrial structure. There are no companies with a market value of more than EUR 100 billion. “The lack of dynamism is self-fulfilling”, he warns.  

But he claims there is hope if – and it’s a big IF – the EU matches its climate targets with a coherent plan to achieve them. He warns that failure to do so will run contrary to competitiveness and growth.  

That all comes with an eye-watering price tag. Eight hundred billion Euros a year to be precise. And that’s on top of current budgets.  

If the time was ever right to tell the story of our important industry – one that generates more than 180,000 jobs across many member states, making products and applications that underpin Europe’s economic and social fabric, then it is now.  

As the EU parliament is re-shaped following summer elections, and new commissioners prepare to take up their seats, we have been preparing a European advocacy campaign.  

Even though the Commission’s work programme has yet to be published, we know that there will be a “rising weight of regulation” as Draghi calls it.  

The Batteries Regulation includes multiple rounds of enabling acts, and work on identifying hazardous substances in batteries is already underway, via the ECHA chemicals agency. And you can be sure lead is firmly on their radar. The Commission also has to decide whether it will extend the exemption for 12v lead batteries in vehicles – a decision that is critical for our industry. And we know that a review of REACH chemicals legislation is also in the mix. These are just some of the known knowns.  

It is also true that European legislators have low awareness of the manufacturing and recycling success story that is the European lead battery value chain. So it is the job of our industry to ensure EU institutions not only value what they have, but support it to thrive on the pathway to greater electrification. We may be just one piece in Mario Draghi’s European industrial competitiveness and innovation jigsaw, but we are an essential one.  

Beyond the battery power we already supply in Europe, there is massive demand for battery energy storage systems as part of a new and integrated approach to energy policy and security. According to KPMG, advanced lead batteries could provide up to seven per cent of that market. 

With an uncertain outlook for Europe’s economy, it remains to be seen if the Trump administration’s agenda of tariffs, tax incentives and encouraging reshoring will be enough to shock Europe into action.  

Or will China’s efforts to shore up its economy with trillion-dollar fiscal packages, trigger a big response from European capitals?  

As Draghi says throughout his report, Europe needs to collaborate more, co-ordinate and make the most of its “common resources”. In the year ahead we will see if EU institutions heed his advice.