In the current geopolitical context, dominated by increasing technological competition the boundaries between economy and security are increasingly blurred. At the core economic security is about using economic measures and tools for security purposes. Shocks such as the COVID-19 pandemic and Russia's war of aggression against Ukraine have highlighted the risks inherent in excessive economic dependencies. Such risks – unless properly managed – can challenge the functioning of our democratic societies and of our economies by limiting our ability to act. At heart, this is about our freedoms and sovereignty.

This new economic security paradigm is to a large extent driven by the strategic rivalry between China and the US and the challenge it poses to the European economy and security. All types of connections can indeed be “weaponised” by other states to gain leverage and advance economic or geopolitical interests, for example through coercion, market manipulation or deliberate supply chain disruptions. We have observed it recently in our relations with Russia or China.

A European economic security framework driven by our own objectives

It is therefore crucial for the EU to develop an economic security framework driven by its own objectives and interests, aiming to maximise the benefits of European traditional economic openness, which we want to keep, while minimising the risks that stem from excessive dependencies and vulnerabilities. We do not seek to limit the development or prosperity of any country and should not fuel, neither the dynamics towards an increased fragmentation of the world economy, nor the potentially self-fulfilling prophecy of a world divided into two different economic blocks.

“We know that economic security can be a delicate balance act. We must therefore be very selective and use the fundamental principles of proportionality and precision.”

But we want to ensure that the EU is well equipped to protect its own security and interests. We know that it can be a delicate balance act: de-risking presents its own risks. We must therefore be very selective and use the fundamental principles of proportionality and precision.

Some of our member states have taken action by introducing measures to address strategic dependencies in critical raw materials and other inputs or by taking national measures to address leakage risks for very sensitive technologies. However, no member state acting alone can ensure its economic security.

The Union has already at its disposal different tools to protect its economic security with the Foreign Direct Investments screening, export controls, the recently agreed Anti-Coercion Instrument or the restrictive measures of the EU’s CFSP. The EU is also developing new tools such as the Chip act, the Net Zero Industrial act or the Critical Raw Materials act…

The case for using all our respective tools together

With this new economic security strategy, we make the case for harnessing the political will to use all our respective tools together, and do so in a closely coordinated way. In this communication, we have identified a non-exhaustive list of risks that we need to monitor closely:

• risks to the resilience of supply chains, including energy security;
• risks to the physical and cyber security of critical infrastructure;
• risks related to technology security and technology leakage;
• risks of weaponisation of economic dependencies or economic coercion.

The next step will be to assess precisely those risks in order to conclude whether using our existing tools effectively can allow us to limit those risks or whether new tools are needed. Far from being a merely technical exercise, this assessment, which should be reviewed every six months, deals with very sensitive issues and may have potentially profound implications for EU’s bilateral relation with third countries.

Regarding potential new instruments, the issue of controlling outbound investment was raised. We would enter uncharted territory and there is currently no consensus among EU member states on this issue. The build-up of a European economic security framework cannot be encapsulated in a single document discussed at a single moment. It should rather be seen as a process that will necessarily take time to build consensus among member states, involving also the private sector and the different EU institutions. Making clear who does what and establishing the right governance for this strategy will be both essential and challenging.

“The build-up of a European economic security framework should be seen as a process that will necessarily take time to build consensus among member states.”

This new economic security framework does not require to change the competences of the Union but it requires for sure to change our working methods. It has often been pointed out that we work too much in silos and that staff in the different Directorates-General of the Commission, the EEAS and the member states should cooperate more closely. With the emergence of the economic security conundrum we can no longer continue to deal with our partners on the one hand about our commercial relations and on the other about questions of security and of international relations. All forms of relations must take into account the security policy dimension and we must urgently reorganise ourselves accordingly.

Intensify the cooperation with third countries on economic security issues

We will also have to intensify the cooperation with third countries on economic security issues. This discussion is naturally taking place in and among other key economies around the globe. The G7 Leaders Statement on Economic Security and Resilience of last May aims at to establish close cooperation on issues such as resilient supply chains, resilient critical infrastructure, economic coercion, harmful practices in the digital sphere and leakage of critical and emerging technologies that threaten international peace and security. And we have started to work closely with our likeminded G7 partners on these issues. However, we need also to work on this issue with the broadest possible range of partners.

We have to discuss in depth on economic security issues with our other international partners to avoid misunderstandings and unnecessary twitching. We are and remain indeed strong supporters of an open rules-based world economic order. Multilateralism is in our DNA.

“We need also to work on economic security with the broadest possible range of partners to avoid misunderstandings and unnecessary twitching.”

We need to adapt rapidly to a more dangerous environment. However, to really strengthen our economic security, we need to adjust carefully our actions to avoid destabilising our relations with our global partners. As HR/VP, in charge of coordinating our foreign and security policy between the member states in the Council and the Commission, this delicate balancing act will be at the heart of my work during the rest of my mandate and it will be for sure the same for my successors for years to come.