“Public finances will not be enough” to finance the digital and environmental transitions, reaffirmed the European Commissioner for Financial Services, Mairead McGuinness, on Tuesday 18 June at the Conference on Financial Integration organised by the European Commission and the European Central Bank (ECB) in Frankfurt.
“The Commission uses a figure of an additional investment of more than €600 billion every single year for the climate transition [...] this is about investing in all of the renewables, the technologies, insulations [...]. But if I look beyond the climate transition, we also need private investment in digital technologies, in innovation and of course defence”, said Ms McGuinness, urging the new European Parliament (see EUROPE 13427/8) to support the efforts of the European Commission and Member States on the Capital Markets Union (see EUROPE 13410/7).
Highlighting the progress made since 2019, the Commissioner called for the remaining obstacles to be removed, saying it was time for “action. “This is a moment where we will need to set aside national vested interests, public or private, in favour of the long-term European goals that will benefit all of us”, was the call from Ms McGuinness, referring in particular to the various pieces of insolvency legislation in force in the EU27.
The Commissioner mentioned three key issues on the table: relaunching the securitisation market, creating pan-European savings products and integrating financial supervision.
“Fragmented national supervision will do nothing to address our need to boost EU competitiveness and cut red tape. Fragmentation is not an efficient way to do business”, she argued.
Progress on financial integration has been disappointing, says the ECB. According to a report on financial integration and structure in the euro area published on Tuesday by the ECB, greater integration of the euro area’s internal market for financial services is needed to ensure Europe’s economic resilience.
“The euro area has shown resilience during the crises, but progress on financial integration has been disappointing. Indicators of financial integration have fallen significantly over the last two years, with no significant increase since the start of monetary union”, said the ECB.
To achieve a fully integrated financial services market, the ECB is making six recommendations: - facilitating cross-border banking transactions; - harmonising the definition of key concepts in EU regulatory frameworks; - integrating the regulatory and supervisory architecture of the capital market; - relaunching securitisation; - increasing standardisation and transparency in the field of structured products; - promoting dynamic capital and equity markets.
Link to the ECB report: https://aeur.eu/f/cpn (Original version in French by Bernard Denuit)