Boosting common savings and joint investments within the EU are two of the main recipes that experts agree on to strengthen competitiveness in the face of the fierce battle between powers such as the United States and China. And progress in the capital market union that allows promoting these investments is a fundamental element of the recommendations of the reports that the EU commissioned from former Italian prime ministers Enrico Letta and Mario Draghi, but at the same time it is a question eternally blocked by the different positions of member states. Today, Spain is following in France’s footsteps and proposing to progress, even at different speeds.
“Let us think of pilot projects or prospective cases, in which certain Member States wish to move forward in the integration of a specific aspect, for example in the union of their capital markets,” said the Minister of the Economy , Carlos Corpus, in a conference at the Grand Continent a few weeks ago. “Even if there is a small group of these Member States which show interest in a particular case study, they can, in collaboration with the European Commission, define specific legal and operational conditions for the operation of this pilot project . This pilot project is launched immediately and, for the period considered, with a very limited time horizon, offering the rest of the Member States the possibility of joining it at the time they deem it necessary,” he added.
The idea will be put on the table of the Eurogroup, which brings together the finance ministers of the euro zone, this Monday. “Once completed, the impact is evaluated and the outcome of this pilot project is estimated. If it is a positive result, if it is a result which allows us to go further precisely with a positive effect on the integration of the whole Union, we will implement it. But we did not wait two or three years for this to be supported, approved and carried out,” Corpo added during this conference. Corps is committed to a mechanism for three or four countries to move forward in joint systems.
The Spanish proposal starts with a harmonized credit rating system for small and medium-sized businesses, as Body explains to the Financial Times. What this system would seek is that the to start up have greater facilities for accessing credit, which until now was mainly granted by banks in Europe, unlike other systems such as the United States.
Capital Market Union would allow the EU to create a common financial market that would pool savings, lead to the integration of stock markets and facilitate common debt. “We don’t have a European financial market and therefore all our savings go to the United States, they feed the American economy and strengthen American companies. These economies come back to Europe to buy our companies,” Letta illustrated in an interview with El Mundo before the presentation of the report commissioned by the 27.
Until now, France was the country that had most clearly chosen to move forward separately in the Capital Markets Union in the face of reluctance from many countries. In some cases, because harmonization would imply a single tax system for companies and addressing this aspect, which is an exclusive competence of the Member States, generates rejection in countries like Ireland or Luxembourg, for example.
The other part of the capital market union is that of banking supervision, which would become more centralized. Although moving in this direction is a mantra repeated repeatedly in the EU conclusions, the truth is that there is no consensus. During one of the last meetings of the leaders of the 27, a dozen states – Luxembourg, Austria, Bulgaria, Cyprus, Czech Republic, Ireland, Croatia, Baltic countries, Malta, Romania and Slovenia – clearly expressed their opposition to such centralized control. entity that would strengthen the role of the European Securities and Markets Authority (ESMA) based in Paris. They fear that this centralization will increase costs for their national financial markets and give competitive advantages to the majors.
