Alona Lebedieva: The EU’s New Economic Strategy – From Globalization to Economic Security
Alona Lebedieva
Alona Lebedieva, owner of the Ukrainian multidisciplinary industrial and investment group Aurum Group, notes that the reason for this shift is quite straightforward – Europe has begun to lose its industrial base. In many sectors, competition from China has become so asymmetric that European manufacturers simply cannot withstand it. This is particularly evident in the production of electric vehicles, batteries and renewable energy equipment. Chinese companies benefit from large-scale government support, cheap financing and significantly larger production capacities. As a result, the European market risks turning into a sales market for foreign industry.
For this reason, the EU is gradually moving from the model of an “open supermarket” toward a model of economic security. This is not only about tariffs or anti-dumping investigations. In reality, a broader system is emerging: screening of foreign investments, rules-of-origin requirements, new conditions for access to public funding and stronger support for strategic industries. In essence, Europe is beginning to do what the United States, Japan and South Korea have done for decades – protecting key technological and industrial sectors.
However, Europe’s reindustrialization cannot rely solely on technologies of the late industrial era. The EU’s problem runs deeper than the loss of certain manufacturing capacities or growing dependence on external suppliers. If one looks at the long-term macroeconomic dynamics of the United States, China and Europe since the 1990s, the difference becomes clear: the American and Chinese economies have grown much faster, while the European economy has also expanded but at a noticeably slower pace.
According to Lebedieva, this gap is largely linked to technological dynamics. Over the past decades, the United States has experienced several powerful waves of innovation – from the dot-com revolution and large-scale digitalization of the economy to breakthroughs in biotechnology, the rapid development of robotics and the shale energy revolution. China, in turn, has scaled many of these technological advances and, in certain sectors – particularly electric vehicles and renewable energy equipment – has itself emerged as a global technological leader.
Against this backdrop, Europe has largely focused on so-called incremental innovation – improving existing technologies and production models. While this approach ensures stable results in traditional industries, its economic return is significantly lower than that generated by breakthrough development in high-tech sectors. This largely explains the already established gap with the United States and the gradual technological strengthening of China.
This challenge is also highlighted in Mario Draghi’s report on Europe’s competitiveness. The report emphasizes that without a sharp increase in investment in high technologies, the digital economy, energy and innovation, the EU risks losing its position in the global economy.
“This signals a deeper transformation of the global economy. The world that was built on maximally open supply chains is gradually splitting into several large economic blocs. The United States is building its own system through the Inflation Reduction Act and the ‘Buy American’ policy. China is developing a model of state-driven industrial capitalism. Europe is now searching for its own model – a balance between market openness and the protection of strategic sectors,” Alona Lebedieva emphasizes.
However, protecting strategic sectors alone does not guarantee an economic breakthrough. If Europe’s reindustrialization is limited to subsidizing traditional industries and strengthening trade protection, it is unlikely to restore technological leadership. Without ambition in breakthrough technologies – artificial intelligence, biotechnology, new energy, the digital economy and robotics – new economic models may prove insufficient to ensure long-term growth.
For Ukraine, this transformation creates both opportunities and challenges. On the one hand, if Europe seeks to reduce its dependence on distant suppliers, it will be interested in manufacturing partners located nearby. Ukraine could become part of new European value chains in metallurgy, mechanical engineering, energy and the production of components for the green economy. Geography, resources and future integration with the EU make this scenario highly realistic.
On the other hand, the EU’s new economic policy implies stricter rules of the game. Access to the European market will increasingly depend not only on price or quality but also on standards, technological integration and political partnership. Europe is gradually turning into an economic club with shared rules governing production, investment and industrial development.
“The question for Ukraine is no longer simply: can we sell to the EU? The real question is different – can we become part of the European factory,” she concludes.
Alona Lebedieva
Aurum Group
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