On Friday 11 April in Warsaw, the European Finance Ministers agreed on the need to strengthen Europe’s competitiveness in the face of the ‘volatility’ of the financial markets, in the context of international trade tensions.
“There was a clear agreement on the need to make urgent progress on the creation of a ‘Savings and Investments Union’ (see EUROPE 13603/5)”, declared Polish Finance Minister Andrzej Domański at the end of a two-hour working session on Friday afternoon devoted to the role of the EU’s financial markets in supporting the investment effort.
“This will address market fragmentation, through unifying regulations and stronger integration of the European capital markets. Today everyone recognized how critical the process is on enhancing the EU’s economic resilience against external threat”, he added.
However, there was no announcement on Friday regarding a lack of tangible progress on financial supervision – the main sticking point between EU Member States in the process of integrating capital markets. “There is no room for centralisation; there’s room for coordination, and I believe the Member States would accept”, said Mr Domański, at the end of the first day of informal discussions.
Robustness of the European financial system. The impact of US customs barriers on the European economy was assessed in the morning by the Eurogroup in its inclusive configuration, expanded to include the EU27 countries, as well as the major European financial institutions (see other news).
“Despite the current difficulties, we have no concerns about the soundness of the European financial system”, said the French Minister for the Economy and Finance, Éric Lombard.
In addition, the Polish Presidency of the Council of the EU has emphasised the interesting shock absorption capacity of the Union’s financial markets.
“For now, spill-over from US yields to euro area yields have been contained”, noted Pierre Gramegna, Managing Director of the European Stability Mechanism.
“In this uncertain environment, one thing is clear: Europe should seize the shift in global economic order as an opportunity”, he advocated, calling for the single market to be deepened on the basis of the conclusions of the ‘Draghi’ and ‘Letta’ reports.
Investment sectors. In the midst of its government formation, Germany has shown its determination to push forward the European competitiveness agenda, arguing for the rapid development of European digital services, as well as for regulatory relief in the chemical industry.
“We believe that European regulations on chemicals are far too strict and that they should evolve towards a risk-based approach, rather than banning entire families of chemicals across the board”, said German Finance Minister Jörg Kukies.
However, no industrial sector was explored in depth in a collegial manner at this informal meeting, acknowledged the European Commissioner for Trade, Valdis Dombrovskis.
“As far as the European Commission is concerned, our assessment nevertheless concludes that we need to be cautious in our fiscal response”, he said at a press conference.
He added that “certain sectors need to be monitored closely”, mentioning in particular the automotive sector, steel and metallurgy, “which are already high on the Commission’s agenda”. (Original version in French by Bernard Denuit)