The European Union has been told its economy cannot be content with simply getting by as it was urged to seize the opportunity.

The call came from Valdis Dombrovskis (pic) EU commissioner for Economy and Productivity; Implementation and Simplification in a speech to discuss the single market’s economic performance.

He said: “The EU’s economy has beaten expectations in the first nine months of this year. Looking further ahead, we expect growth to continue at a moderate pace, despite the challenging external environment.”

Dombrovskis  added inflation is on track to be around the 2% target in the euro area, and only slightly higher in the EU, over the forecast horizon.

He warned it was expected there will be less positive developments in the coming years, with debt and deficit ratios edging up.

“This is especially the case in certain Member States,” Dombrovskis continued. “We must remain vigilant to safeguard the fiscal sustainability. It provides the foundation to building a strong and sustainable European economy.”

“This forecast is clouded by significant uncertainty, and the road ahead is full of potential pitfalls,” he added. “If anything is certain, it is that uncertainty will remain a defining feature of the coming years.

“The challenging external environment means that we should look to domestic drivers to fuel growth. Europe must rely on and develop its own strengths.

“This means redoubling our efforts to enhance our competitiveness and unlock Europe’s full growth potential. The message is clear: We must act and we must act now.”

Dombrovskis explained developments in global trade have created a more challenging external environment.

“Globally, trade barriers have reached historic highs,” he said. “We anticipate that trade policy decisions by the US, and the responses from other key players like China, will dampen global trade.

“This forecast assumes that all tariffs implemented, or credibly announced, by the US by the cut-off date will remain in place throughout the forecast horizon. The average tariff rate faced by EU exporters to the US stands at around 10%.

“This is slightly higher than in spring, and significantly above the average tariffs before the Trump administration took office.

“Of course, the EU’s highly open economy remains susceptible to ongoing trade restrictions and uncertainty.

“At the same time, the EU faces lower average tariffs relative to many other economies, including China or India.

“This provides the EU economy with a relative advantage – albeit in a context of weak global goods trade and a strong euro tempering foreign demand.”

Dombrovskis  said Europe must rely on Europe to drive growth.

“While we must strive for a greater level of growth, we should also acknowledge that this is not an insignificant achievement, considering the very challenging environment,” he continued. “In 2026 and 2027, we see growth picking up or remaining robust in most Member States.”

Dombrovskis  concluded: “The impact of the current tariffs and non-tariff restrictions on the European economy might be greater than expected.

“An escalation of geopolitical tensions could exacerbate negative supply shocks and undermine confidence.”

“In light of these factors, the EU must take resolute action to unlock growth. For there are also opportunities to seize.”

“Overall, we can no longer afford to be content with just getting by. We have a window of opportunity. We must seize it now, before it is too late.”