Europe must pool industrial capital to match China's clean energy surge

China secured 23 of the world’s 36 major clean industrial projects financed last year, leaving both Europe and the United States lagging behind. As emerging economies advance in the green transition, global industrial power is being rapidly redrawn.

Faced with this shift, European governments continue to act in isolation. Member states rely primarily on national subsidies and competing tax incentives, effectively bidding against one another for investment rather than combining their financial weight. This internal fragmentation prevents European clean technology firms from achieving global scale.

To be sure, critics of centralised industrial planning reasonably worry about bureaucratic delays and the risk of governments picking commercial losers. Public support must remain disciplined and market-driven to avoid waste.

Yet no single European state possesses the economic mass or capital depth to match state-backed industrial powerhouses on its own. Continuing with 27 separate national approaches ensures that Europe will remain dependent on foreign suppliers for critical future technologies.

The answer is not national protectionism, but European scale. By pooling investment resources and completing the capital markets union, Europe can build the continental industrial capacity required to compete globally while preserving open markets.

Drafted with AI, edited by the editor.