Vujčić urges deeper integration to absorb geopolitical shocks
European Central Bank (ECB) Vice-President Boris Vujčić said cutting internal EU barriers by 2 percent could offset, over the long run, higher US tariffs' projected 0.7 percentage-point impact on euro area GDP between 2025 and 2027.
Fragmentation leaves investment exposed
Internal EU barriers amount to tariff equivalents of up to 67 percent for goods and 95 percent for services, Vujčić said.
Since 2014, equity-market frictions fell around 12 percentage points within the euro area, against 25 points with the United States.
US venture capital funds invest around six times as much as EU funds.
Markets and fiscal transfers absorb around 70 percent of US state-level output shocks, against 30 percent in the euro area.
Euro area capital markets absorb only 5 to 10 percent.
During COVID-19, the most exposed European firms with mainly domestic shareholders cut investment 20 percent more than peers with international owners.
European firms also cut investment after oil-price increases; US firms did not.
One jurisdiction for cross-border banking
Speaking at the Central Bank of Ireland's fifth Financial System Conference in Dublin, Vujčić called for completing the savings and investments union, a priority shared with Commissioner Albuquerque.
Cross-border banking groups need free movement of capital and liquidity, he said.
He advocated European deposit insurance, consistent bank crisis management and harmonised creditor hierarchies and insolvency rules.
Harmonising withholding taxes would support capital-market integration.
Strong capital and liquidity buffers and diversified funding remain necessary.
Openness needs financial resilience
Vujčić's argument makes integration a condition for resilience, not a retreat from openness.
The EU imports 57 percent of its energy, leaving diversification only part of the answer.
He also backed the digital euro and European wholesale payments infrastructure, noting Pontes launched in September 2026.