German Chancellor Friedrich Merz Wednesday called for "bold" action by the European Union to reverse a quarter century of industrial "decline" and compete with the United States and China.

"Only an economically powerful Europe will be a sovereign Europe," Merz told industry chiefs gathered in the Belgian port city of Antwerp.

European leaders are set to discuss a number of questions to fortify the continent's competitiveness in talks over the course of two days, with the meeting in Antwerp having been the first day of talks.

All 27 leaders of the bloc are set to gather in a Belgian castle east of Brussels on Thursday to discuss topics including boosting the single market to compete globally.

"It is high time for Europe to act, to act swiftly and to act decisively," Merz said, calling for the EU to "deregulate every sector."

Merz open to revise or postpone EU carbon market rules

The leader of Europe's largest economy also said the EU's existing carbon market could be revised or even postponed to these ends.

"The system is implemented to reduce CO2 emissions ‌and at the same time ‌to ​enable the companies to come to CO2-free production lines," Merz said.

"So ​if this is not achievable, and if ⁠this ​is not the right ​instrument, we should be ​very open ‌to revise it, or at least to ​postpone ⁠it," he said.

European leaders call for reset to implement economic reforms

French President Emmanuel Macron told business leaders that the only solution to economic rivalries was to make Europe "an independent power," while European Commission President Ursula von der Leyen said EU member states needed to unify their financial policies in order to bring in more capital and better compete in the world market.

Edited by: Kate Hairsine