EU leaders move closer to "two-speed Europe" to boost competitiveness

The long-debated concept of a “two-speed Europe” is moving closer to reality, as EU leaders gathered at Alden Biesen castle in eastern Belgium on 12 February for an informal summit aimed at boosting competitiveness across the bloc, EU Observer reports.

“One Europe, one market, this was today the headline of the discussion, and this is our ambition,” said European Commission President Ursula von der Leyen, unveiling a roadmap of reforms to be presented ahead of the next formal EU leaders’ meeting in Brussels in March. EU Council President António Costa added, “In 1992, we moved from a common market to the single market; now we are moving from a single market to one market,” promising to finalise the process “before the end of 2027.”

Several leaders, including von der Leyen, French President Emmanuel Macron, and German Chancellor Friedrich Merz, now support a “two-speed” Europe proposal, which allows willing member states to advance reforms without full unanimity. “Often we move forward with the speed of the slowest, and the enhanced cooperation avoids that,” von der Leyen said.

The summit focused on three key priorities: completion of the single market, regulatory simplification, and ambitious trade policy. Italian Prime Minister Giorgia Meloni announced a working group led by Italy, Germany, and Belgium to continue discussions on competitiveness ahead of the March European Council meeting.

Leaders also explored the long-stalled Capital Markets Union, now rebranded as the Savings and Investment Union (SIU), aimed at mobilising long-term savings and investment. Von der Leyen warned that if sufficient progress is not made by June 2026, a smaller coalition of member states may advance the initiative. “Get me right. I prefer doing this by ’27,” she said, adding that at least nine countries could move forward faster.

Another potential game-changer is the so-called “28th regime,” which would harmonize company registration and labour rules across the EU, eliminating the patchwork of 27 national systems. “Wherever you are, you can set up an EU-incorporated company within 48 hours,” von der Leyen said.

Discussion also covered the so-called “European preference” policy, favoring local content in strategic sectors such as AI, quantum technologies, defence, and clean energy. Costa emphasized a targeted approach: “We will map and identify our dependencies and address them through a diversification strategy based on European preference, applied in selected strategic sectors.”

On energy, von der Leyen pledged a July review of the EU’s emissions trading system, asserting, “Decarbonisation and growth can go hand-in-hand. If you want to pollute, you pay. If you do not want to pay, you innovate.”

The summit signaled growing momentum for a flexible, reform-driven Europe, with a selective coalition of states likely to spearhead initiatives if consensus among all 27 members proves elusive.

By Vafa Guliyeva