EU's Competitiveness Compass – North-Pointing or are Things Heading South for Agri Policy?

Ursula von der Leyen Photographer: Dati Bendo European Union, 2025

Competitiveness is the key word of this new Von der Leyen Commission 2.0 – and the EU’s new ‘Competitive Compass’ is supposed to steer it onto a path towards security and economic prosperity. But far from pointing North, many see it as a sign of things heading South for the green and agricultural transition over the next 5 years. Natasha Foote breaks down what you need to know.

A classic ‘everything and nothing’ Commission special, the Competitiveness Compass, the EU’s new cornerstone “growth strategy”, is impressively light on details for such a dense communication. As one commentator put it, it’s more of a Michelin-style air-filled mousse than a dish with any real substance.

Which begs the question, why write about it?

Well, the compass – which was published on Wednesday (29 January) – is the first major initiative of this new political cycle and will form the backbone of the Commission’s approach going forward. That means it’s an important indicator of the direction of travel (literally, considering the heavy use of transport references, from ‘roadmap’ to ‘compass’, coming from the Commission).

Read/download the Competitiveness Compass

Dubbed the EU chief’s ‘North Star’, the new playbook for EU policies over the next 5 years signals a shift towards competition and industry. Forget the ‘Farm to Fork’ logic – ‘clean’ is officially the new ‘green’.

The entire framing of the compass is a race (to the top or the bottom, depending on your perspective), with the central tenet of the compass that the EU is “lagging behind” other major economies, such as the US and China.

So what does this all mean for the agrifood sector? Well, the main meat of agrifood policy over the next 5 year political cycle will come in a few weeks’ time, with the publication of the EU’s Vision for Agriculture and Food.

But we should still keep an eye on the wider policy context in which we’re operating now – or preferably several eyes, especially with increasing crossover between Commissioners, sectors and policy initiatives.

So what is inside?

Let’s first cover the core points: The compass is split into three main overarching aims: ‘closing the innovation gap’; decarbonisation, and reducing ‘excessive dependencies’; and finally increasing security. To achieve these, there are 5 so-called ‘horizontal enablers’ (*new buzzword alert*): simplification, removing barriers in the EU’s single market, financing, skills and quality jobs, and better coordination.

Now to the details, and the devils in them.

Decarbonisation, but also deregulation

A positive point in the compass is that it reiterates the EU’s commitment to become carbon-neutral by 2050, set out in the Green Deal. “[The EU] will stay the course, including through the intermediate 2040 target of 90%,” the compass states.

The problem is, at the same time, it calls for an “unprecedented simplification effort” to boost competitiveness. But environmental campaigners warn that this is Commission-speak for massive deregulation, which risks undermining essential EU standards in areas like food safety, workers’ rights, and environmental protections.

Civil society and trade union organisations have already written to the Commission urging it to provide guarantees against the rollback of social and environmental standards, and for the regulations required for socio-ecological transition at both EU and national levels.

“The launch of the compass risks becoming a victory for polluting industries at the expense of workers, the environment, and future prosperity,” WWF Director Ester Asin warned, adding that while the communication acknowledges the importance of the green transition and mounting climate impacts, its proposed actions “remain too vague to deliver the urgency and ambition required”.

What to watch: But everything in the compass points in the other direction – one towards speed and ease over safety. The effort starts this month, with the first in a series of so-called ‘Simplification Omnibus’ packages. This aims to streamline legislation for sustainable finance, due diligence and taxonomy rules, with the hope of saving companies €37 billion a year by 2029.

This ‘simplification and streamlining’ thinking will be felt keenly in shaping future EU agrifood policy, especially the EU’s Common Agricultural Policy (CAP) reform, with the first proposal for the post-2027 iteration of the CAP due this summer.

It is also worth watching out for the upcoming Clean Industrial Deal, which will give more devilled-details in this competitiveness-driven approach to decarbonisation.

Technofix

The compass identifies the root cause of uncompetitiveness as a lack of innovation and new technology, stressing the need to “enhance technological sovereignty” and “reignite its innovation engine” (yes, more transport references).

As such, the compass sets out the desire to position Europe at the forefront of innovation in “tech sectors that will matter in tomorrow’s economy” across sectors including agriculture and food and feed – this includes biotechnologies (read: new GMOs) and Artificial Intelligence (AI), including ‘AI Gigafactories’ and ‘Apply AI’ initiatives to drive development and industrial adoption of AI in key sectors (See forthcoming piece by Benny Haerlin and Franziska Achterberg of Save our Seeds for more).

What to watch: A new European Biotech Act is supposed to provide a “forward-looking framework” conducive to innovation and a ‘EU Bioeconomy Strategy’, both earmarked for sometime 2025-2026 and both of which have implications for agri-biotech sectors. The ‘European Innovation Act’ pencilled for early 2026 and a ‘Life Sciences strategy’ in the first half of 2025 (as a reminder, EU strategies are just non-binding policy frameworks, while acts are more interesting as they carry more legal weight).

Meanwhile, all this is happening on the back of potential progress on Commission’s plans to loosen the rules on the use of new genomic techniques (NGTs, also known as gene editing or new GMOs) over the in Council. See here for more details.

Trade tensions

Trade – or, more precisely, being undercut by cheap imports produced below EU standards – was a key driver of farmers’ discontent last year, sparking renewed calls for mirror measures in trade agreements.

But the compass charts a very different course.

Arguing that trade with third countries is a “key driver for Europe’s prosperity,” the compass stresses the need for a “high degree of trade openness” for “enhancing its resilience”. Championing the recent handshake on the EU-Mercosur agreement (it’s not a done deal just yet – look out for our coverage explaining the likely next steps in the coming weeks), it emphasises the need to forge new trade relations.

There is an acknowledgement of the challenges posed by unfair competition and unlevel playing fields – but it offers little in the way of addressing this, besides using tools already at the EU;s disposal and a continued effort to push for a “modernised” World Trade Organisation rulebook.

An interesting part for agrifood is the suggestion to leverage public procurement to safeguard the EU’s own capacities. For this, it suggests introducing a European preference in public procurement for “strategic sectors and technologies”.

There is also a push to look at strategic inputs where the EU is not self-sufficient, with the conversation in farming lobbies immediately turning to fertilisers.

To watch: The EU’s new Clean Trade and Investment Partnerships, which aims to bring together targeted trade and investment rules, plus advancements on the Mercosur deal