The EU needs to tackle a long-running shortfall in investment and refocus its economic policy to respond to global challenges, the European Economic and Social Committee warned in a statement.
The Committee, an advisory body representing employers, workers and other interest groups, said on Tuesday that the bloc’s “chronic lack of investment” was undermining productivity, innovation and what it called the EU’s “strategic sovereignty.”
Its comments were set out in an opinion on the European Commission’s “2026 European Semester – Autumn Package”, adopted at the Committee’s February plenary session.
The European Semester is the EU’s annual cycle of coordinating economic and budgetary policies across member states.
“Europe cannot compete, innovate, or protect its citizens without more investment,” said Luca Jahier, rapporteur for the opinion.
Jahier stated that environmental, technological and demographic challenges were “interconnected” and called for “innovative ideas towards an integrated capital market” and indicators that include “well-being beyond GDP” — a reference to measuring factors such as quality of life rather than output alone.
Five priorities flagged for the 2026 EU economic cycle
The Committee said it had made 18 recommendations, grouped into five political priorities.
It called for “large-scale investments”, including a “common fiscal capacity” backed by targeted issuance of European debt and permanent macroeconomic stabilisation tools modelled on SURE — an EU scheme set up during the pandemic to help countries finance job-support measures.
On capital markets, it said “financial fragmentation” was blocking cross-border investment and urged the Commission to assess whether a US law — the 1996 National Securities Markets Improvement Act — could offer a model for reducing regulatory differences between countries.
The Committee also called for changes to the EU’s economic governance, including a review of the Macroeconomic Imbalance Procedure and Debt Sustainability Analysis, alongside an expanded Social Scoreboard and new well-being indicators proposed by the European Commission’s Joint Research Centre.
It welcomed a new recommendation on “human capital” in the Commission’s autumn package and said investment in education, training, skills and mutual recognition of qualifications should be treated as a “strategic necessity.”
On defence, it warned that uncoordinated national spending could create inefficiencies, increase reliance on non-EU suppliers and add to debt, and called for conditions that encourage collaborative procurement and prioritise European defence projects.
The Committee said organised civil society should have a direct role in the European Semester process, calling for it to be “democratically accountable, transparent and anchored in broad and active societal participation.”
