On September 9, 2024, the Draghi Report was published, quantifying the need for annual investments in Europe to improve its competitiveness and productivity at between 750 billion and 800 billion euros, and advocating for the simplification and better application of regulations. More recently, an analysis (Garp-EBF) was published, quantifying the extra capital required from European banks, beyond international Basel standards, at 273.2 billion euros. This results in a reduced financing capacity for the economy of between 2.7 and 4.1 trillion euros. Banks currently cover more than 70% of Europe’s financing needs.
The report by the former ECB President calls for strong measures to boost innovation, the energy and digital transitions, and also for a clear strategy to eliminate rigidities and overcome market fragmentation, as the Letta Report had previously pointed out. Furthermore, it considers the creation of a truly integrated European capital market a priority.
This is a key priority for European authorities, and the first steps have already been taken. Examples include the Omnibus sustainability package, which aims to reduce excessive and unjustified reporting burdens for companies without questioning the ultimate goal of combating climate change. This is also reflected in the current work of the ECB, SSM, EBA, and the Commission itself in the banking sector.
It has been a year since this report was presented. It is now time to assess the determination and ambition of the progress made, or the need for greater impetus. However, it is also essential, in any case, to maintain direction and not lose sight of the horizon: greater European competitiveness.
José Luis Martínez Campuzano, spokesperson for the Spanish Banking Association
