European Commission President Ursula von der Leyen announced a significant reduction in Europe's reliance on Russian fossil fuels at the World Economic Forum 2025 in Davos. Gas imports from Russia have decreased by nearly 75%, oil imports are now down to just 3%, and no coal is being imported from Russia. However, von der Leyen warned that this transition to energy independence has come at a high cost, leading to increased energy prices for households and businesses across Europe. The full implications of this shift are still unfolding.
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NewsTranscript
00:00It's now my deep pleasure and honor to introduce the President of the European Commission,
00:20Ursula von der Leyen.
00:22Mr. President, you have been a friend and a regular participant of our meetings since,
00:30I would say, quite some time.
00:33And I remember still very vividly when you joined us five years ago at the beginning
00:39of your first mandate.
00:41And nobody knew at that time what great challenges you would have to face, a pandemic, a war.
00:51But nevertheless, you were able to give Europe, in addition to managing those crises well,
00:59to give Europe new visions, a vision of a digital Europe, the Green Deal, to mention
01:09only a few.
01:11And now you are standing at the beginning of your second mandate.
01:16And again, Europe is faced with tremendous challenges.
01:21I would say the next five years will be crucial.
01:25Either we come out as a very reinforced Europe, which is still the second largest global economy.
01:39And if I look at population, I think we are number three.
01:44I'm sure that under your leadership, Europe will be not marginalized, what could happen,
01:53but Europe will be strengthened during your second mandate.
01:58And for this reason, you can imagine how much we are looking forward to your speech.
02:03Welcome, Ursula.
02:09Lieber Klaus Schwab, lieber Karin Keller-Sutter, Your Majesties, Presidents, Prime Ministers,
02:30Excellencies, Ladies and Gentlemen.
02:34The first quarter of the century has come to an end.
02:40And it has brought about a sea change in global affairs.
02:45This century started with great expectations.
02:50Twenty-five years ago, the era of hyper-globalization was nearing its peak.
02:56As supply chains went global, hundreds of millions of people were being lifted out of
03:02poverty, especially in India and China.
03:07In America, the dot-com boom was at its height, symbolizing the optimism of a connected global
03:14world in which technology was seen as an unambiguous force for prosperity and peace.
03:24With Russia making the G7-G8, democracy was ascended across the world.
03:33You might recall that some even said it was the end of history.
03:37In our European Union, our single currency, the euro, was about to bring our people and
03:43economies much closer together.
03:48The global economy reaped the dividends.
03:51And here in Davos, world leaders discussed how global cooperation in technology could
03:58help the fight against poverty and disease.
04:04It was the promise of a more integrated and cooperative world.
04:12Twenty-five years on, has this promise been fulfilled?
04:17Well, the world today is still nearly as connected as ever.
04:23But it has also started fracturing along new lines.
04:28On the one hand, since the year 2000, the volume of global trade has doubled, although
04:35trade within regional blocks is now expanding faster than trade between them.
04:44It is common that a chip is designed in the United States, built in Taiwan with European
04:50machines, packaged in Southeast Asia, and assembled in China.
04:56On the other hand, last year alone, global trade barriers have tripled in value.
05:05International trade institutions have often struggled to address the challenges posed
05:12by the rise of non-market economies that compete at a different set of rules.
05:21Innovation continues to flourish, with advances in AI, quantum computing, and clean energy
05:26poised to change our way of life and work.
05:30But technology controls have also quadrupled in recent decades.
05:38Our supply chain dependencies are at times weaponized, as shown by Russia's energy blackmail,
05:47or exposed as brittle when global shocks, such as the pandemic, emerge without warning.
05:55And the very interconnectors that bring us together, like undersea data cable, have become
06:02targets from the Baltic Sea to the Taiwan Strait.
06:09The cooperative world order we imagined 25 years ago has not turned into reality.
06:18Instead, we have entered a new era of harsh geostrategic competition.
06:25The world's major economies are vying for access to raw materials, new technologies,
06:32and global trade routes.
06:35From AI to clean tech.
06:38From quantum to space.
06:41From the Arctic to the South China Sea.
06:45The race is on.
06:48As this competition intensifies, we will likely continue to see frequent use of economic tools
06:56such as sanctions, export controls, and tariffs that are intended to safeguard economic and
07:03national security.
07:06But it is important that we balance the imperative to safeguard our security against our opportunity
07:16to innovate and enhance our prosperity.
07:20In this spirit, we will need to work together to avoid a global race to the bottom.
07:29Because it is in no one's interest to break the bonds of the global economy.
07:34Rather, we need to modernize the rules to sustain our ability to produce mutual gain
07:42for our citizens.
07:46For us Europeans, the race begins at home.
07:52Europe has a unique social market economy.
07:54We have the second largest economy and the biggest trading sector in the world.
07:59We have longer life expectancy, higher social and environmental standards, and lower inequalities
08:08than all our global competitors.
08:12Europe is home to immense talent, along with a proven ability to attract ideas and investment
08:19from across the world.
08:22Our capacity to invent and create is underappreciated.
08:27Europe's global share of patent applications is on par with the US and China.
08:34But the world is changing.
08:38So must we.
08:41For the last 25 years, Europe has relied on the rising tide of global trade to drive
08:48its growth.
08:51It has relied on cheap energy from Russia.
08:56And Europe has too often outsourced its own security.
09:02But those days are gone.
09:06To sustain our growth in the next quarter of a century, Europe must shift gears.
09:12And this is why I asked Mario Draghi to deliver a report on European competitiveness.
09:18And on that basis, next week the European Commission is presenting our roadmap, the
09:26Competitiveness Compass, which will drive our work for the next five years.
09:33The goals will be increased productivity by closing the innovation gap, a joint plan for
09:41decarbonisation and competitiveness, overcome skills and labour shortages, and cut red tape.
09:54It's a strategy to make growth faster, cleaner and more equitable by ensuring that all Europeans
10:01can benefit from technological change.
10:05And let me elaborate more on three foundations that will underpin this strategy.
10:14First, Europe needs a deep and liquid capital market.
10:22European household savings reach almost 1.4 trillion euros, compared with just over 800
10:30billion in the United States.
10:33But European companies struggle to tap into that and raise the funding they need.
10:40Because our domestic capital market is fragmented, and because that pushes money overseas, 300
10:49billion euros of European family savings are invested abroad every year.
10:57That's a key issue holding back the growth of our tech start-ups and hindering our innovative
11:04clean tech sector.
11:07We do not lack capital.
11:10We lack an efficient capital market that turns savings into investments, particularly for
11:18early-stage technologies that have game-changing potential.
11:24And this is why we will create a European Savings and Investments Union, with new European
11:32savings and investments products, new incentives for risk capital, and a new push to ensure
11:41the seamless flow of investment across our Union.
11:45We will mobilise more capital to let made-in-Europe innovation and risk-taking thrive.
11:55Second, we must make business much easier all across Europe.
12:04Too much of our top talent is leaving the European Union because it's easier to grow
12:11their companies elsewhere.
12:14And too many firms are holding back investment in Europe because of unnecessary red tape.
12:23We need to act on all levels – continental, national and local – and we want to lead
12:30the way at the European level.
12:32For instance, we will launch a far-reaching simplification of our sustainable finance
12:41and due diligence rules.
12:45And we will make sure to create a conducive environment for our SMEs to scale up their
12:51capacity to build, produce and innovate in Europe.
12:57But I want to go even further than this.
13:01Today, the European single market still has too many national barriers.
13:07Also sometimes companies are dealing with 27 different national legislations.
13:16We will offer instead to innovative companies to operate all across our European Union under
13:25one single set of rules.
13:29We call it the 28th regime.
13:33Corporate law, insolvency, labour law, taxation – one single and simple framework across
13:40our Union.
13:42This will help bring down the most common barriers to scaling up all across Europe.
13:49Because continental scale is our greatest asset in a world of giants.
13:57The third foundation is energy.
14:04Before the start of Putin's war, Europe got 45% of its gas supplies and 50% of its
14:15coal imports from Russia.
14:20Russia was also one of our largest oil suppliers.
14:26This energy appeared cheap, but it exposed us to blackmail.
14:33So when Putin's tanks rolled into Ukraine, Putin cut us off his gas supplies and in return
14:41we substantially reduced our dependency on Russian fossil fuels in record time.
14:47Our gas imports from Russia went down by roughly 75%.
14:52Now we import from Russia only 3% of our oil and no coal at all anymore.
15:00But freedom came at a price.
15:05Households and businesses saw sky-high energy costs and bills for many are yet to come down.
15:14Now our competitiveness depends on getting back to low and stable energy prices.
15:22Green energy is the mid-term answer.
15:25Because it is cheap, it creates good jobs here in the European Union, and it strengthens
15:33our energy independence.
15:37Already today, Europe generates more electricity from wind and solar than from all fossil fuels
15:42combined.
15:43But we still have lots of work to do to feed through these benefits to companies and people.
15:51Not only must we continue to diversify our energy supplies and expand clean sources of
15:57generation from renewables and, in some countries, also from nuclear.
16:03We will have to invest in next-generation clean energy technologies, like fusion, enhanced
16:11geothermal and solid-state batteries.
16:16We must also mobilize more private capital to modernize our electricity grids and storage
16:23infrastructure.
16:25We must remove the remaining barriers to our energy union.
16:31And we must better connect our clean and low-carbon energy systems.
16:38All of this will be part of a new plan that we will present in February.
16:45It is time to complete our energy union, so that clean power can run freely across
16:52our continent and bring prices down for all Europeans.
16:59Ladies and gentlemen, this is our plan.
17:04And the next few years will be vital to stay in the race of clean and disruptive technologies.
17:14Europe has everything it needs to make it happen.
17:18We have a private sector with a long-standing tradition of innovation.
17:23We have a top-class workforce.
17:27We have a huge single market of 450 million consumers and a unique social infrastructure
17:33to protect people from the great risks of life.
17:38We have credible and independent institutions, transparent governance, and an unshakable
17:48commitment to the rule of law.
17:51It is thanks to all of this that in the last five years, Europe has weathered the fiercest
17:56storm in our economic history, and we overcame an unprecedented energy crisis.
18:03We did this together.
18:06And we can do it again.
18:09And we have the political will.
18:12Because when Europe is united, it gets things done.
18:19Ladies and gentlemen, the coming years will be vital, well beyond Europe.
18:27All continents will have to speed up the transition towards net zero and deal with
18:33the growing burden of climate change.
18:37Its impact is impossible to ignore.
18:42Heat waves across Asia, floods from Brazil to Indonesia, from Africa to Europe, wildfires
18:52in Canada, Greece and California, hurricanes in the U.S. and the Caribbean.
19:00Climate change is still on top of the global agenda.
19:05From decarbonizing to nature-based solutions, from building a circular economy to developing
19:14nature credits, the Paris Agreement continues to be the best hope for all humanity.
19:25So Europe will stay the course and keep working with all nations that want to protect nature
19:33and stop global warming.
19:37Likewise, all continents will have to grasp the opportunities of AI and manage its risks.
19:46On challenges like these, we are not in a race against each other.
19:52But we are in a race against time.
19:57Even in a moment of harsh competition, we need to join forces.
20:03And Europe will seek cooperation not only with our long-time like-minded friends, but
20:09with any country we share interests with.
20:14Our message to the world is simple.
20:18If there are mutual benefits in sight, we are ready to engage with you.
20:25If you want to upgrade your clean tech industries, if you want to upscale your digital infrastructure,
20:33Europe is open for business.
20:37And as great power competition intensifies, I see a growing appetite across the world
20:43to engage more closely with us.
20:48In the last two months, we concluded new partnerships with Switzerland, Mercosur and Mexico.
21:00This means that 400 million Latin Americans will soon be engaged in a privileged partnership
21:08with 450 million Europeans.
21:13These deals were in the making for years, if not decades.
21:16So why are they all happening today?
21:23It is not only because Europe is a large and attractive market.
21:29But because with Europe, what you see is what you get.
21:36We play by the rules.
21:38Our deals have no hidden strings attached.
21:42And while others are only interested in exporting and extracting, we want to see local industries
21:49flourish in our partner countries.
21:53Because this is also in our interest.
21:57It is how we diversify our supply chains.
22:01And this is why Europe's offer is so attractive all across the world.
22:06From our neighbours in Africa who are working with us to develop local clean tech value
22:12chains and clean fuels.
22:16To the vast Asia-Pacific region.
22:20Hence, the first trip of my new Commission will be to India.
22:28Together with Prime Minister Modi, we want to upgrade the strategic partnership with
22:34the largest country and democracy in the world.
22:39I believe we should also strive for mutual benefits in our conversation with China.
22:47When China joined the WTO 25 years ago, the impact of rising Chinese exports was called
22:56the China shock.
22:59Today, some are talking about a second China shock because of state-sponsored overcapacity.
23:08Of course we must respond to this.
23:11Defensive trade measures are being adopted across the world, including the Global South,
23:16as a response to Chinese market distortions.
23:20This is also why Europe has taken measures, for instance on electric cars.
23:27At the same time, I have always stressed that we are ready to continue our discussions.
23:36And we will continue to risk our economy.
23:40Many believe, including in China, that it would be in China's long-term interest to
23:45manage more responsibly its economic imbalances.
23:51And I believe that we must engage constructively with China to find solutions in our mutual
23:59interest.
24:012025 marks 50 years of our Union's diplomatic relations with China.
24:10I see it as an opportunity to engage and deepen our relationship with China, and where
24:17possible, even to expand our trade and investment ties.
24:23It is time to pursue a more balanced relationship with China, in a spirit of fairness and reciprocity.
24:36This new engagement with countries across the world is not only an economic necessity,
24:41but a message to the world.
24:44It is Europe's response to rising global competition.
24:48We want more cooperation with all who are open for it.
24:55And this, of course, includes our closest partners.
24:59I think, of course, of the United States of America.
25:04No other economies in the world are as integrated as we are.
25:11European companies employ in the United States 3.5 million Americans.
25:18And another million American jobs depend directly on trade with Europe.
25:23Entire supply chains stretch on both sides of the Atlantic.
25:27For instance, an American airplane is built with controlled systems and carbon fibres
25:32from Europe.
25:34And American medicines are made with chemicals and laboratory tools that come from our side
25:40of the Atlantic.
25:42At the same time, Europe imports twice as many digital services from the United States
25:51as we do from the entire Asia-Pacific.
25:55Of all American assets abroad, two-thirds are in Europe.
26:02And the US provides over 50% of our LNG.
26:07The trade volume between us is 1.5 trillion euros, representing 30% of global trade.
26:22A lot is at stake for both sides.
26:26So our first priority will be to engage early, discuss common interests and be ready to negotiate.
26:39We will be pragmatic.
26:42But we will always stand by our principles.
26:46We will protect our interests and uphold our values.
26:51Because that is the European way.
26:56The rules of engagement between global powers are changing.
26:59We should not take anything for granted.
27:03And while some in Europe may not like this new reality, we are ready to deal with it.
27:10Our values do not change.
27:14But to defend these values, in a changing world, we must change the way we act.
27:24We must look for new opportunities, wherever they arise.
27:29This is the moment to engage beyond blocks and taboos.
27:36And Europe is ready for change.
27:39Thank you very much, and long live Europe.
27:55Thank you very much, Madam President.
27:59This was really a demonstration of what I call constructive optimism.
28:07I think you dealt with all the major issues, but there was one issue where I still would like to ask you a question.
28:19We may face reduced American engagement in Ukraine.
28:26What will be the consequence for Europe, and how do you see Europe's role in the ongoing war in Ukraine?
28:37Thank you very much, Klaus.
28:41I think we should never forget where it all started.
28:45Ukraine is a sovereign country.
28:48And Ukraine determined its own future by asking for accession to the European Union.
28:57That's where it all started.
29:00And the response was an invasion by its neighbour Russia.
29:04Secondly, I think we should also never forget in the European Union
29:09that this is not only about the security of Ukraine, but it's also about the European security.
29:17And the third point is, no one wants more peace than the people of Ukraine.
29:25But what they want is a just and a lasting peace.
29:30What they don't want is a frozen conflict that erupts again a little time later.
29:38I have witnessed over the last three years how Ukraine is working hard for the accession to the European Union.
29:49It's amazing to see the speed in which they work on heavy, difficult reforms while fighting a war.
29:59So for us, because of all this, it is very clear that we will continue to support Ukraine.
30:06We have supported Ukraine by now by almost 130 billion euros.
30:12But we will continue to support Ukraine without any question.
30:16Whatever happens next, for us it's important that Ukraine stays an independent country
30:25and that it is Ukraine that decides on its own territory.
30:32And therefore, Klaus, the sentence is still valid.
30:37We stand by Ukraine for as long as it takes.
30:41Thank you. That was a very clear message.
30:47And of course, we will welcome President Zelensky during this meeting.
30:53And let me just say, Madam President, I think you provided us with a clear vision and perspective for Europe,
31:05even in a very difficult time.
31:09But we can look to the future of Europe with, I would repeat, with constructive and pragmatic optimism.
31:20Thank you for what you are doing.
31:22And we wish you, on behalf of all the audience, we wish you all the best for the mandate for the next five years to come.