Stournaras: Savings Union to boost Europe's investment, resilience
Yannis Stournaras, Governor of the Bank of Greece, emphasized the critical role of the Savings and Investments Union (SIU) in strengthening the European economy. Speaking in Athens, he highlighted the need to channel European savings into productive investments to boost productivity and reduce energy dependence.
Mobilizing Europe's €33 trillion savings
Geopolitical turbulence and energy supply shocks continue to pressure the euro area economy, a net energy importer.
This necessitates significant investments to reduce energy dependence and upgrade technology.
The Draghi report estimated Europe needs an additional EUR 750-800 billion annually until 2030 to meet these needs.
While Europe holds substantial private sector savings, amounting to EUR 33 trillion according to the Letta report, these are not fully mobilized for domestic investments.
European households save about 15 percent of their income, almost twice as much as in the US or UK, but predominantly deposit these funds into bank accounts rather than investing directly into European capital markets.
This creates an investment gap, hindering innovation and productivity growth.
Deepening integration, boosting competitiveness
The SIU aims to channel European savings into productive and innovative units via capital markets, reducing funding costs and closing the investment gap with global competitors.
Initiatives include promoting pan-European market operators (PEMO) and the Market Integration and Supervision Package (MISP).
The MISP enhances ESMA's supervisory role and harmonizes listing and disclosure rules.
Progress is also needed in post-trading activities and a common EU framework for distributed ledger technology (DLT).
Completing the Banking Union, especially establishing the European Deposit Insurance Scheme (EDIS), and issuing Eurobonds are crucial to unlock investments and strengthen the euro's global role.
An opportunity not to be missed
Europe faces a critical juncture where past crises have often spurred deeper integration.
The SIU represents a timely and necessary response to persistent investment deficits and external shocks, offering a clear path to enhanced competitiveness.
However, success hinges on overcoming entrenched national fragmentation and ensuring political will translates into concrete, coordinated action across all member states.