<p>"As a response to the Covid crisis, some EU businesses are reconsidering their value chains, where some strategic products would be manufactured on the European continent and its proximity. How can we leverage our geographical and cultural proximity with the Eastern and Southern Neighbours to bring manufacturing closer, diversify and ultimately achieve greater open strategic autonomy? What would it take in terms of regulatory alignment, business environment and EU policy engagement? Improving the business environment, rule of law, and regulatory aspects on goods production has been for several years an area where the EU is encouraging the neighbourhood partners to progress – and many of which do. What more can and needs to be done? The Commission has also been working on how to strengthen the support of European foreign direct investment for SMEs in the region via European equity. Particularly on regulatory aspects, benefits from better regulatory alignment could influence the choice of investors to integrate parts of their production line from neighbouring countries. What role could alignment processes (e.g. Agreements on Conformity Assessment and Acceptance of Industrial Products) play in this regard? While some countries are quite advanced in this process, others see more challenges for their economic and regulatory environment. What options could be leveraged to mutually benefit the relevant ecosystems?"</p>