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Europe's economic policy change: key to the future
EU summit decides on measures to strengthen the domestic economy: discussion on investments, capital markets union and state aid. Stay informed!
Europe's economic policy change: key to the future
Economic challenges, both internal and external, have led EU heads of state and government to call for an adjustment to the economic policy of the international community. In a final statement from their summit in Brussels, they emphasized the need for economic policy change in the face of geopolitical tensions and unequal subsidy practices. Chancellor Olaf Scholz underlines the untapped potential of the EU internal market and the importance of an effective strategy to fully exploit it.
The EU is experiencing increased competition, particularly from the USA and China, which give their companies advantages through generous subsidies. To withstand this pressure, EU leaders are emphasizing the mobilization of funds as a crucial factor for investment. Charles Michel, the EU Council President, advocates a combination of public and private financing to facilitate investment in key strategic areas and infrastructure.
A special report authored by Enrico Letta highlights the importance of mobilizing funds from individuals and companies worth €33 trillion in existing private savings in the EU. This report highlights that around 300 billion euros of European citizens' savings are diverted abroad every year, particularly to the USA. The heads of state and government are therefore calling for accelerated implementation of the Capital Markets Union in order to attract private capital and develop cross-border investment products.
The EU also plans to improve the efficiency of supervision of capital markets and strengthen citizens' financial literacy to promote investment. Chancellor Scholz is optimistic about the convergence of the European capital markets and emphasizes the role of the underdeveloped EU capital market as a main cause of lower growth dynamics compared to other regions of the world.
The discussion within the international community also revolves around the possibility of increasing state aid and reducing bureaucracy in order to offset the consequences of aid from China and the USA. An important focus is on the role of the European Investment Bank and the long-term EU budget, as well as the creation of stricter state aid rules at national level and increased funding for EU projects by member states. The heads of state and government instruct the Commission to reduce the bureaucratic burden on companies and authorities in order to make economic policy fit for the future.