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Draghi Warns EU Is Falling Further Behind, Calls Pause on High-Risk AI Rules

He says the bloc still lacks a path to fund needed investment after only a small share of his 383 proposals were fully delivered.

Former European Central Bank (ECB) chief Mario Draghi delivers a keynote address on the progress made and the transformations that have taken place since the release of Draghi Report on EU competitiveness in 2024, in Brussels, Belgium September 16, 2025. REUTERS/Yves Herman
Europe needs to act faster to overhaul its economy, said former European Central Bank chief Mario Draghi
Mario Draghi spoke during a conference in Brussels following an address by EU chief Ursula von der Leyen

Overview

  • An independent tracker reported that about 11% of Draghi’s 383 competitiveness recommendations are fully implemented and roughly 20% are partially in place.
  • Draghi cited an AI capability gap, noting the United States produced 40 large foundation models last year, China 15 and the EU just three.
  • He warned that high energy costs are curbing technology adoption, with European natural gas prices near four times U.S. levels and AI electricity demand projected to rise 70% by 2030.
  • He said Europe is now squeezed by U.S. tariffs and a widening trade imbalance with China, with the deficit up around 20% since December 2024.
  • The European Commission pointed to steps on competitiveness and confirmed €150 billion in defense loans to 19 member states, as Ursula von der Leyen urged faster delivery.