Eurozone finance ministers are betting on boosting the European capital market to ensure an increase in private investment and strengthening the European Union’s competitiveness, minimizing the role that new common financing of the 27 may have in counteracting the loss of capacity of the Eurozone. bloc to compete against the United States or China.
After a meeting intended, this Monday, to discuss the economic prospects for the euro area and also competitiveness, the final declaration mentions only once the report on “The Future of European Competitiveness” produced by the Italian Mario Draghi, and ends for not subscribing to the document and its recommendations. The former president of the European Central Bank, it is worth remembering, signaled additional annual investment needs in the EU of up to 800 billion euros and defended new issuances of common debt to guarantee part of this amount.
“We recognize the significant financing needs associated with digital and environmental transitions, new defense priorities, and research and development. At a time when public finances have been affected by multiple crises and sustained and gradual fiscal consolidation is necessary, the necessary investment must primarily originate from private sources”, reflects the final communication.
To this end, the Eurogroup led by Irishman Paschal Donohoe sees the “deepening of the Capital Market Union” as urgent, saying it awaits proposals from the European Commission to reduce fragmentation and regulatory barriers. The task, it is worth remembering, will be the responsibility of Portuguese commissioner Maria Luís Albuquerque in the new European executive. Ministers still say they are committed to the objective of completing the Banking Union.
As far as European public funds are concerned, they will have “an important role”, but only to attract private investment, with the Eurogroup’s statement referring to the statutes of the European Investment Bank, which has this function within the EU. “European funding should focus on areas in which public goods can be provided more effectively jointly”, he argues.
The meeting, which took place in an inclusive format – that is, also with government officials from countries that are not part of the Euro Zone – also resulted in the defense of the idea that “industrial policies must be limited in scope, oriented towards the future, aiming to create an environment favorable business model for increased investment and focused on sectors and technologies, rather than individual companies”. On the other hand, the declaration states that “effective application of State aid rules must be maintained” to ensure a competitive environment.
The topic of European competitiveness will be discussed again at the informal European Council scheduled for this Friday, in Budapest, Hungary.
Source: www.jornaldenegocios.pt
