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00:00I'm going to hear now from the European Commission, President Ursula von der Leyen, speaking at Davos.
00:05It is now 56 years since the first meeting here in Davos, and the idea of the founder, Klaus Schwab, was to create a platform to discuss the issues and the ideas of the day.
00:19Of course, the world has transformed completely since 1971. But the original idea of Davos has remained, as we just have heard in the speeches.
00:33So I was delighted that you have gone back to your roots with this year's theme, a spirit of dialogue, because this spirit is all the more important in a world that is more fractured and more fractious than ever.
00:501971 was the year of the so-called Nixon shock, and the decision to de-link the U.S. dollar from gold.
01:04In an instant, the foundations of the Bretton Woods system and the entire global economic order set up after the war effectively collapsed.
01:17But it also had two major effects.
01:20It inadvertently created the conditions for what would become a truly global order, and it provided a sharp lesson for Europe and on the need to strengthen its economic and political power.
01:38It was a warning to reduce our dependencies, in this case, on a foreign currency.
01:44The world may be very different today, without any question, but I believe the lesson is very much the same.
01:54That geopolitical shocks can and must serve as an opportunity for Europe.
02:03And in my view, the seismic change we are going through today is an opportunity, in fact, a necessity, to build a new form of European independence.
02:16And this need is neither new nor a reaction to recent events.
02:23It has been a structural imperative for far longer.
02:27So when I use this term, European independence, around a year ago, I was surprised at the sceptical reactions.
02:39But less than one year on, there is now a real consensus around this.
02:45The sheer speed and almost unthinkable scale of the change have driven this, but the underlying imperative is still the same.
02:57The good news is, we acted immediately, whether on energy or raw materials, defence or digital, we are moving fast.
03:12But the truth is also that we will only be able to capitalize on this opportunity if we recognize that this change is permanent.
03:23Of course, nostalgia is part of our human story, but nostalgia will not bring back the old order.
03:33And playing for time and hoping for things to revert soon will not fix the structural dependencies we have.
03:43So my point is, if this change is permanent, then Europe must change permanently too.
03:51It is time to seize this opportunity and build a new, independent Europe.
04:00And ladies and gentlemen, this new Europe is already emerging.
04:07On Saturday, I was in Asunción, in Paraguay, to sign the EU-Mercosur Trade Agreement.
04:15It was a breakthrough after 25 years of negotiations.
04:23And with it, the European Union and Latin America have created the largest free trade zone in the world.
04:30A market worth over 20% of global GDP, 31 countries with over 700 million consumers, aligned with the Paris Agreement.
04:46So this agreement sends a powerful message to the world, that we are choosing fair trade over tariffs,
04:57partnership over isolation, sustainability over exploitation,
05:05and that we are serious about de-risking our economies and diversifying our supply chains.
05:14And that will not stop in Latin America.
05:18Last year, we reached new agreements with Mexico, Indonesia and Switzerland, our host country.
05:25We are working on a new free trade agreement with Australia.
05:31We are also advancing with the Philippines, Thailand, Malaysia, the United Arab Emirates and more.
05:38And right after Davos, the next weekend, I will travel to India.
05:47There is still work to do, but we are on the cusp of a historic trade agreement.
05:54Indeed, some call it the mother of all deals.
05:58One that would create a market of 2 billion people, accounting for almost a quarter of global GDP.
06:08And crucially, that would provide a first-mover advantage for Europe,
06:14with one of the world's fastest-growing and most dynamic continents.
06:20Europe wants to do business with the growth centers of today and the economic powerhouses of this century.
06:28From Latin America to the Indo-Pacific and far beyond,
06:32Europe will always choose the world, and the world is ready to choose Europe.
06:47And ladies and gentlemen, this reality also reflects the fact
06:51that Europe has all the assets it needs to attract investment.
06:57The savings, the skills, the innovation with our AI factories and gigafactories
07:06and the applications that are necessary, AI first.
07:11What we need now is to mobilize collectively these assets to their full potential
07:17and to focus on the essential.
07:22So focal point number one is to create a conducive and predictable regulatory environment.
07:31We live in an age where capital and data can cross Europe in a second.
07:37And business must be able to move just as freely.
07:42But as things stand, too many companies have to look abroad to grow and scale up,
07:49partly because they face the new set of rules every time they expand into a new member state.
07:56So while on paper, the market is of 450 million Europeans open to them,
08:05it is far more complicated in reality.
08:09And that acts as a handbrake on the growth and profit potential of companies.
08:15So this is why we need a new approach.
08:19We will soon put forward our 28th regime.
08:22The ultimate aim is to create a new, truly European company structure.
08:30We call it EU Inc.
08:33With a single and simple set of rules that will apply seamlessly over our union.
08:42So that businesses can operate across member states much more easily.
08:46Our entrepreneurs, the innovative companies, will be able to register a company in any member state within 48 hours, fully online.
08:59They will enjoy the same capital regime all across the European Union.
09:03And ultimately, we need a system where the companies can do business and raise financing seamlessly across Europe just as easily as in uniform markets like the United States or China.
09:18If we get this right, and if we move fast enough, this will not only help EU companies grow, but it will attract investment from across the world.
09:31Which brings me to the second focus, investment and capital.
09:39We are now building the savings and investment union.
09:44We need a large-scale, deep and liquid capital market that attracts a wide range of investors.
09:52And this will allow businesses to find the funding they need, including equity, at lower costs here in Europe.
10:02We have made proposals on market integration and supervision to ensure our financial market is more integrated.
10:11This covers trading, post-trading and asset management, as well as driving innovation and making our supervisory framework more efficient.
10:24This will help ensure that capital flows where it is needed, to scale-ups, to SMEs, to innovation, to industry.
10:37And the third priority is to build an interconnected and affordable energy market, a true energy union.
10:48Energy is a choke point for both companies and households.
10:53And just look at the dispersion of prices across European electricity hubs.
10:59Europe needs an energy blueprint that pulls together all the part.
11:04This is our affordable energy action plan.
11:08We are, for example, massively investing in our energy security and independence with interconnectors and grids.
11:17This is for homegrown energies that we are trying to promote as much as possible, the nuclear and the renewables,
11:27to bring down prices and cut dependencies, to put an end to price volatility, manipulation and supply shocks.
11:34But now we have to speed up this transition.
11:38Because homegrown, reliable, resilient and cheaper energy will drive our economic growth and deliver for Europeans and secure our independence.
11:51Ladies and gentlemen, whether on trade or business, capital or energy, Europe needs an urgency mindset.
12:05Our starting point is good.
12:07We are home to global champions in fields ranging from wind power to next-generation batteries,
12:14from aerospace to the industrial machines that are essential to build the chips and advanced weapons.
12:21Our companies are taking up AI at the same pace as their U.S. peers.
12:27Europe is in the race for the key technologies of tomorrow.
12:31But as global competition gets ruthless, we must show real ambition, especially in those sectors vital for our independence.
12:46Take defense, for example.
12:49We have done more on defense in the last year than in decades before.
12:56We have started a surge in defense spending up to 800 billion euros till 2030.
13:05Member states are stepping up their investment at record level.
13:10And this has helped to triple the market value of European defense industry companies since January 2022.
13:18We now have three leading European defense tech startups that have reached unicorn valuation.
13:29They are working on AI-powered software and systems for battlefield intelligence.
13:35Or on advanced dual-use and surveillance drones.
13:39So they are also driving innovation and investment in Europe's defense tech industrial base.
13:48All of this would have been unthinkable even a few years ago.
13:54This now only shows how economy and national security are more linked than ever.
14:04But also what we can do when Europeans have the will to match the ambition.
14:12So, ladies and gentlemen, this need for ambition is most important when it comes to the security of our continent.
14:21In just over a month, we will mark the fourth anniversary of Russia's war of aggression against Ukraine.
14:34Four years on, Russia shows no sign of abating.
14:40No sign of remorse.
14:44No sign of seeking peace.
14:46On the contrary, Russia is intensifying its attacks, killing civilians every day as we speak.
14:57Just last week, its bombing of Ukraine's energy infrastructure left millions facing darkness, cold, and water shortages.
15:08This must end.
15:10We all want peace for Ukraine.
15:25We recognize President Trump's role in pushing the peace process forward.
15:30And we will work very closely with the United States.
15:34And we all agree that, therefore, Ukraine must be in a position of strength to go to the negotiation table.
15:44And this is why we Europeans have decided to provide Ukraine with a loan of 90 billion euros for 2026 and 2027.
15:55With this support, we make sure that Ukraine can bolster its defense on the battlefield, strengthen its defense capabilities for a peace agreement, and keep basic services running.
16:11Above all, it reaffirms Europe's unwavering commitment to the security, the defense, and the European future of Ukraine.
16:22And in parallel, we decided to permanently immobilize the Russian assets, and that we reserve the right to make use of them.
16:37This should serve as a stark reminder to Russia, and as a message to the world.
16:43But, Europe will always stand with Ukraine until there is a just and lasting peace.
16:59Ladies and gentlemen, I've spoken a lot today about European independence, on partnerships, on prosperity, and security.
17:10So, I would like to conclude with Greenland, an issue which cuts to the heart of all three of these imperatives.
17:25When it comes to the security of the Arctic region, Europe is fully committed.
17:32And we share the objectives of the United States in this regard.
17:39For instance, our EU member, Finland, one of the newest NATO members, is selling its first icebreakers to the United States.
17:49And this shows that we have the capability right here, in the ice, so to speak.
17:57It shows that our northern NATO members have Arctic-ready forces right now.
18:03And above all, that Arctic security can only be achieved together.
18:08And this is why the proposed additional tariffs are a mistake, especially between long-standing allies.
18:20The European Union and the United States have agreed to a trade deal last July.
18:27And in politics, as in business, a deal is a deal.
18:33And when friends shake hands, it must mean something.
18:40Ladies and gentlemen, we consider the people of the United States not just our allies, but our friends.
18:50And plunging us into a downward spiral would only aid the very adversaries we are both so committed to keeping out of the strategic landscape.
19:01So our response will be unflinching, united, and proportional.
19:10But beyond this, we have to be strategic about how we approach this issue.
19:17And this is why we are working on a package to support Arctic security.
19:21First principle, full solidarity with Greenland and the Kingdom of Denmark.
19:28The sovereignty and integrity of their territory is non-negotiable.
19:34Second, we are working on a massive European investment surge in Greenland.
19:41Second, we will work with Greenland and Denmark hand-in-hand to see how we can further support the local economy and infrastructure.
19:52Third, we will work with the United States and all partners on wider Arctic security.
20:01This is clearly in our shared interest, and we will step up our investment.
20:06In particular, I believe we should use our defense spending surge on a European icebreaker capability and other equipment vital to the Arctic security.
20:20And fourth, in the same spirit, we need to work with all our regional partners to strengthen our common security.
20:31And this is why we will look at how to strengthen our security partnerships with partners such as the UK, Canada, Norway, Iceland, and others.
20:45Finally, I believe Europe needs to adjust to a new security architecture and realities that we are now facing.
20:53And this is why Europe is preparing its own security strategy, which we plan to publish later this year.
21:01And as part of this, we are upgrading our Arctic strategy too.
21:07And at the heart of this will be the fundamental principle.
21:11It is for sovereign people to decide their own future.
21:16Ladies and gentlemen, when I started preparing for this year's address, security in the high north was not the main theme.
21:29But in many ways, it feeds into the wider point I started with today.
21:34That Europe must speed up its push for independence, from security to economy, from defense to democracy, having the dialogue with our friends and partners, also if necessary with adversaries.
21:53The point is that the world has changed permanently and we need to change with it.
21:59And therefore, thank you and long live Europe.
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