The report advocates for an annual spending increase of €800 billion, which represents about 5% of the EU's GDP, to bolster economic competitiveness.

Upcoming discussions regarding the report's proposals are expected to be contentious, reflecting deep divides among member states, particularly between northern and southern Europe.

He warns that without decisive action, Europe may face compromises on welfare, environmental standards, or personal freedoms, framing the situation as an 'existential challenge'.

Experts suggest that while Draghi's report may ignite crucial discussions about the EU's future, actual progress could be hindered by the complex political landscape among member states.

Former ECB chief Mario Draghi has released a comprehensive report indicating that the EU economy requires substantial investments and innovation to stay competitive with the USA and China.

Presented to the European Commission, Draghi's report includes 170 proposals aimed at enhancing the EU's competitiveness, following a year of preparation requested by Commission President Ursula von der Leyen.

Key focus areas of the proposed plan include digitalization, decarbonization, and strengthening defense capabilities.

The report highlights significant challenges facing the European economy, particularly the need for increased investment to compete with American technological advancements and to ensure the green transition is economically viable.

It also calls for reduced reliance on U.S. defense equipment, noting that nearly two-thirds of defense purchases currently come from the U.S.

Draghi attributes the EU's economic struggles to several factors, including the Covid-19 pandemic, the war in Ukraine, and inflation driven by rising energy costs.

To support the green transition, Draghi urges EU member states to streamline licensing processes for lithium extraction, referencing the Critical Raw Materials Act aimed at expediting approvals.

Draghi suggests a mixed strategy for importing cheaper green technologies, emphasizing the need to balance support for domestic production with climate objectives.