Tuesday Morning Papers Summary

LA REPUBBLICA - -The Italian government is accelerating implementation of the EU's AI Act with its first package of national measures, establishing the regulatory framework for artificial intelligence ahead of most other member states.

The plan defines supervisory authorities, compliance mechanisms and safeguards for high-risk AI systems, positioning Italy among the first countries to operationalize Europe's landmark AI legislation while attempting to balance innovation with consumer protection. - -Pressure is mounting within the European Union for a more assertive industrial strategy as Italy pushes for greater flexibility on investment, competitiveness and strategic sectors.

Italian policymakers argue that Europe's regulatory burden and slow decision-making are undermining its ability to compete with the United States and China, particularly in advanced manufacturing, energy and digital technologies.

Rome continues to advocate an industrial policy that prioritizes competitiveness alongside fiscal discipline and the green transition. - - FRANKFURTER ALLGEMEINE ZEITUNG - -Germany's industrial competitiveness remains under intense pressure as growing numbers of manufacturers consider relocating production and investment abroad.

Business leaders argue that high energy costs, excessive regulation and persistent bureaucracy are eroding Germany's attractiveness as an industrial base, prompting renewed calls for Berlin and Brussels to simplify rules and strengthen Europe's competitiveness. - -The AfD continues to expand its electoral potential, with new polling suggesting the party could attract up to 35% of voters under favorable conditions.

The FAZ examines whether the party's support has room to grow further, concluding that dissatisfaction over migration, economic stagnation and energy policy continues to broaden its appeal beyond its traditional base, creating a strategic dilemma for Germany's mainstream parties. - -Germany is preparing a major overhaul of its pension system by phasing out the popular " Rente mit 63 " (retirement at 63).

Researchers argue that the early retirement scheme has contributed to labor shortages and placed additional strain on public finances, with millions of workers leaving the labor force despite being capable of remaining employed.

The debate reflects Berlin's broader challenge of adapting its welfare state to an ageing population and slowing economic growth. - - HANDELSBLATT - - Covestro is reconsidering major investments in Europe, with CEO Markus Steilemann warning that the continent suffers from "fundamental cost disadvantages." The chemicals group is instead evaluating new MDI production facilities in China and the Persian Gulf, arguing that persistently high energy prices, regulation and operating costs are making Europe increasingly unattractive for large-scale industrial investment. - -After years of trade tensions, the European Union and China have agreed to intensify negotiations with the aim of producing concrete results by October in four key areas of economic cooperation.

Brussels hopes the prospect of closer trade ties will encourage Beijing to address longstanding concerns over market access, industrial subsidies and unfair competition, while avoiding a broader deterioration in EU-China economic relations. - -Germany's coalition government is increasingly concerned that a renewed "China shock" is accelerating the erosion of the country's industrial base.

Ahead of a high-level meeting, coalition leaders are expected to debate a tougher trade policy toward Beijing while attempting to balance economic dependence on China with growing concerns over industrial competitiveness, strategic resilience and supply-chain security. - - IL SOLE 24 ORE - - Ford has recalled approximately 350 engineers due to the failure of its AI-based automated quality control systems.

This decision marks a significant shift for the automaker, which had invested heavily in AI, as noted by Vice President Charles Poon.

He highlighted that relying solely on AI without adequate human expertise led to subpar results.

COO Kumar Galhotra emphasized the need for specialized skills to address weaknesses before production.

Despite these challenges, Ford continues to pursue AI integration, with over 100,000 new tests and plans to implement AI across its operations, including installing 900 AI-equipped cameras in manufacturing plants. - -The European Union has approved a significant increase in tariffs on imported steel and iron products as part of a broader effort to strengthen trade defenses and protect European industry from low-cost imports.

The new measures tighten existing safeguards and reflect growing concern in Brussels over global overcapacity, particularly from Asia, while seeking to preserve the competitiveness of Europe's steel sector. - -Italy's electricity transformer manufacturers are urging the European Union to exempt electrical steel from new tariff measures, warning that the specialized material is essential for power grids, renewable energy projects and industrial electrification.

Industry representatives argue that higher import duties would increase production costs, delay infrastructure investment and undermine Europe's energy transition. - -Italy faces another disruptive month of industrial action as a wave of transport strikes is scheduled throughout July, with 5 July expected to be one of the most difficult days for air travel.

Unions representing airport and aviation workers are planning nationwide stoppages that could lead to widespread flight cancellations and delays, adding further pressure to Italy's already strained summer travel season. - - LES ECHOS - -In June 2026, France experienced a significant decline in inflation, dropping to 1.8% year-on-year, down from 2.4% in May—0.6 points lower than anticipated according to INSEE's provisional data.

This reduction in the rate of price increases is largely attributed to a notable decrease in oil prices.

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