The impact on regions and cities of the EU's policy to reduce reliance on imports of critical raw material, in particular from China, was among the main topics discussed during the meeting of the Commission for Economic Policy (ECON) of the European Committee of the Regions (CoR) on 19 April. Local and regional leaders also adopted a draft opinion on the European Interoperable Act and were presented the LORDIMAS tool, an instrument to track the digital transformation that will be launched soon.
Raw materials are becoming more and more indispensable to the decarbonisation revolution that the European Union wants to achieve in the coming decades. For instance, the European Commission has estimated that by 2030 EU demand for lithium, used to manufacture electric-vehicle batteries, will increase twelve-fold. However, the transition to climate neutrality will have different impacts on European regions. To avoid growing territorial disparities and ensure that no region is left behind, ECON members discussed how to strengthen Europe's competitiveness and productivity at local and regional level during their meeting. The focus was on the Commission's recently proposed Critical Raw Materials Act and the Net Zero Industry Act.
Regions and cities depend on critical raw materials to varying degrees. Therefore, members stressed the need for regional action to establish sustainable and innovative value chains. As China currently holds market power both on the supply as well as demand side, local leaders highlighted that the EU needs to strengthen the different stages of the European critical raw-materials value chain and reduce its dependency on Chinese supplies.
Members made clear their support for strengthening the EU's net-zero technology manufacturing ecosystem, but at the same time called for early involvement in the formulation and development of strategic projects. Local and regional authorities also have a key role to play in promoting training and reskilling, particularly in building the capacity of public-sector workers. They also constitute a key level for securing acceptance of the EU's strategic objectives on clean-energy technologies, and of industrial projects. Furthermore, many European sectors, in particular energy-intensive sectors, need access to net-zero technologies in order to remain competitive and circular. ECON members stressed that, as far as net-zero production is concerned, regions would benefit enormously from more investment certainty, better policy coordination and a reduced administrative burden. In this respect, a strong and effective EU Cohesion Policy will play an important role in supporting these regions in managing a just and fair transition.
Regional and local leaders will follow up on the debate and continue work on these topics through two dedicated opinions, for which Isolde Ries (DE/PES) – for critical raw materials – and Mark Speich (DE/EPP), for the Net Zero Industry Act, have been appointed rapporteurs.
During the ECON meeting, members also adopted by unanimity the draft opinion on the Interoperable Europe Act, supporting the creation of a system of EU-wide interoperability. Local and regional authorities play a key role in the provision of digital services and interoperability has the potential to significantly increase the efficiency of public administrations. To achieve this, ECON members called on the Commission to adopt clearer rules, make a clear financial commitment and generally provide holistic support to ensure that local and regional authorities do not have to live beyond their means in terms of the resources provided.
The rapporteur Michele País (IT/ECR), President of the Council of the Autonomous Region of Sardinia, said: “Digital cohesion can provide promising opportunities for insular territories like my hometown Sardinia. The Interoperable Europe Act represents a key pillar of Europe's digital future. As rapporteur, I strived to ensure that local and regional authorities are provided with sufficient financial support to implement interoperability solutions, and for the governance of interoperability to be based on a well-balanced structure, respecting the principle of subsidiary and taking into account citizens' priorities."
The draft opinion is scheduled to be adopted during the CoR's 24-25 May plenary session.
A new instrument that could support EU cities in their digital transition is the LORDIMAS tool, a local digital maturity assessment instrument, which was presented during the ECON meeting. The tool will give the EU and its Member States an overview on the state of play of the digital transformation at local level. Cities and communities will be able to benchmark their own status against that of their peers and will have access to a unique database for reporting and bench-marking on digital issues. LORDIMAS is an initiative of the CoR, the European Commission and ESPON in the framework of the Living-in.eu initiative and will be officially launched during the Mayor's Digital Assembly 2023 on 15 June.
Finally, members of the ECON commission appointed Pehr Granfalk (SE/EPP) as rapporteur on Digital Resilience and Antonio Mazzeo (IT/PES) as rapporteur on the European Commission Annual Report on Competition Policy 2022.
As a response to the American Inflation Reduction Act, the European Commission published its proposal for a Net-Zero Industry Act (NZIA) on 16 March. The proposal is part of the Green Deal Industrial Plan with the overall goal of enhancing the competitiveness of Europe's net-zero industry and supporting the fast transition to climate neutrality. The NZIA aims to scale-up clean tech manufacturing in the EU with the ambition that the EU's strategic net-zero tech manufacturing capacity should reach at least 40% of the Union's annual deployment needs by 2030.
Together with the proposal for a European Critical Raw Materials Act and the reform of the electricity market design, the Net-Zero Industry Act sets out the European framework to reduce the EU's reliance on highly concentrated imports, while accelerating the progress towards the EU's 2030 climate and energy targets and the transition to climate neutrality by 2050.
The proposed regulations now need to be discussed and agreed by the European Parliament and the Council of the European Union before their entry into force.
In 2021 the CoR adopted a first opinion on the Action Plan for Critical Raw Materials (rapporteur Isolde Ries, Mayor of West Saarbrücken District – DE/PES), in which local leaders underlined that regions have varying levels of dependence on critical raw materials. Therefore, it called for regional dependencies on such materials to be identified, as well as the consequent need for regions to take action to build sustainable and innovative value chains.
Living-in.eu is a bottom-up movement that aims to accompany cities in their digital transformation and enables cities and regions to work together on societal challenges with the help of digital solutions. The initiative is a cooperation of Eurocities, Open & Agile Smart Cities (OASC), European Network of Living Labs (ENoLL) and is supported by the European Commission and the European Committee of the Regions.