EU leaders meet in Belgian castle to tackle competitiveness gap with U.S. and China

EUROPEAN Union leaders are set to hold candid discussions on Thursday at the 16th-century Alden Biesen castle in eastern Belgium to address the bloc’s lagging economic growth and ensure it is not left trailing the United States and China, or disadvantaged by global trade restrictions and tariffs.

Reuters cited that the EU faces mounting pressures, including Donald Trump-era trade barriers and Chinese limits on exports of critical minerals, just as it seeks greater wealth to fund decarbonisation, digitalisation, and reinforce defences against Russia.

EU growth has persistently fallen behind that of the US and China, while productivity and innovation, including in fields such as artificial intelligence, remain below global rivals.

European Council President Antonio Costa will host the retreat, inviting former Italian prime ministers Mario Draghi and Enrico Letta, authors of influential 2024 reports on EU competitiveness and the single market, to share their perspectives.

The Draghi report has become a blueprint for action, although only 15% of its recommendations have been fully implemented, with around half either partially executed or in progress, according to the European Policy Innovation Council think tank.

The retreat will focus on the EU’s trade diversification agenda and streamlining regulations widely criticised by businesses.

Deepening the single market is also a priority. Letta urged EU leaders to commit to completing the currently fragmented single market by 2028.

“I think that is the only way to respond to Trump and to external pressures that the European Union is under from China, Russia and the U.S. in different ways,” he told Reuters.

European Commission President Ursula von der Leyen emphasised the need for a clear timetable at the next summit in March, saying leaders must commit to decisive steps.

On the eve of the retreat, some 900 companies signed a declaration calling for bold and urgent action, stating, “While the situation is dire, the outcome is not inevitable.”

Andrea Renda, director of research at the think tank CEPS, said Europe still possesses the skills, capital, innovative start-ups, and quality of life necessary to attract top talent.

He stressed that Europe’s challenge lies in prioritising funding in areas of excellence rather than spreading resources too thinly across the Union, alongside deeper integration of capital markets, to remain competitive with China and the United States. - February 12, 2026