On Friday 23 February in Ghent, the European finance ministers will attempt to identify the initiatives to be taken during the next European legislative cycle with a view to deepening the Capital Markets Union (CMU).
This meeting of the Eurogroup in inclusive format will enable the ministers to have “an in-depth discussion” with a view to providing “political guidance” for the finalisation of a Eurogroup declaration that could be adopted by the time of the euro area summit at the end of March, an EU source said on Wednesday 21 February.
In particular, the ministers will react to the draft declaration submitted to them ahead of Friday’s meeting. According to this project, a copy of which has been sent to EUROPE (see EUROPE 13354/16), they will identify three areas of work: - strengthening the financial architecture to remove barriers to European integration; - facilitating companies’ access to capital markets; - introducing incentives to get retail investors more involved.
On the first front, the aim would be to develop the prudential treatment of ‘securitisation’ with a view to controlled growth of this market. Also under consideration is the idea of transferring the supervision of certain financial entities either directly to the European Securities and Markets Authority (ESMA) or to colleges of national supervisors coordinated by ESMA. The European Commission could also be asked to identify and ensure the removal of obstacles to the concentration of stock exchanges.
According to the draft text, the Commission will be invited to improve the conditions for investing in shares, particularly on a cross-border basis, for institutional investors (e.g. pension funds) or retail investors, by regulatory means, tax incentives or other measures at EU and national level. Implementation of the European framework for sustainable finance should also be encouraged.
With regard to retail investment by citizens and SMEs, the creation of dedicated, easy-to-use digital platforms is envisaged. Member States would be asked to review their tax systems to ensure that they encourage retail investment.
“There is a real desire on the part of the Member States to move forward” in deepening the CMU, noted this source. Once the Eurogroup declaration has been finalised, it will be up to the European Commission, he said, to decide whether or not to take up the ideas submitted to it and incorporate them into its 2024-2029 work programme.
To see the Eurogroup’s draft statement, go to https://aeur.eu/f/axc
Macroeconomic situation. Time permitting, the twenty ministers from the euro area countries will review the macroeconomic situation on the basis of the European Commission’s recent economic forecasts (see EUROPE 13351/2).
In particular, these forecasts predict a sharper slowdown in growth in the euro area - 0.5% of GDP by 2023 and 0.8% of GDP by 2024 - while maintaining the prospect of a rebound, albeit delayed. (Original version in French by Mathieu Bion)