Key Takeaways from the Informal Ecofin Meeting in Ghent
EU Finance Ministers and Central Bank Governors gathered in Ghent on the 23rd and 24th of February to tackle the EU competitiveness challenge. Dr. Mario Draghi and EIB President Calviño were invited to share their insights. Across three thematic sessions, discussions aimed at identifying possible financing mechanisms to bolster both internal EU competitiveness, as well as the Union’s global competitive position. Ministers stressed the importance of avoiding subsidy races, both on a European and a global level.
The insights acquired during those sessions are set to guide the strategic agenda of the new Commission.
Three core issues were standing out from those different sessions:
- European Funding for European Challenges: Ministers stressed the need for targeted European funding to address multiple common challenges, including competitiveness, the green and digital transition and defence.
- Elevated Role for the European Investment Bank (EIB): There is unanimous support for the EIB to play a more significant role in mobilising private capital. The EIB’s potential in addressing competitiveness and defence industry challenges, complementing its role as Climate Bank, was emphasized.
- Promoting Financial Literacy: Ministers and Governors highlighted the importance of improving financial literacy in order to facilitate retail investor participation in financial markets. There is enormous potential in the activation of dormant household savings.
“The challenges we face as a Union are mounting. An enormous amount of investment will be needed in the coming years, public as well as private. I am very pleased we were able to have a discussion without any taboos on concrete solutions to the financing question, because European problems ask for European solutions. I am convinced we made significant progress, and we are ready to put the identified solutions into action.”
Deputy Prime Minister, Minister of Finance and President of the Ecofin Council
Towards a stronger EIB
As Chair of the Board of Governors of the EIB, Minister Van Peteghem invited EIB President Nadia Calviño to outline her vision on the bank's strengths, its challenges and future priorities. A very fruitful discussion led to the conclusion that Ministers endorsed a stronger role for the EIB in tackling competitiveness and defence challenges, as well as further enhancing its role as a Climate Bank.
A follow-up on this discussion will be held in Luxembourg at the annual meeting of the Board of Governors in June.
Boosting Financial Literacy and Retail Investor Participation
Ministers and Central Bank Governors were given an overview of the conference on financial literacy that was organised by the European Commission and the FSMA (Belgian Financial Markets Authority) on Tuesday. Commissioner Mairead McGuinness and President Jean-Paul Servais provided insights, complemented by academic perspectives from Professors Maria Demertzis and Annamaria Lusardi.
Ministers and Governors outlined three lines of action in enhancing financial literacy and retail investor participation:
- Offering better access to clear information for citizens;
- Providing tools to compare different investment products;
- Proposing attractive EU-wide saving products for retail investors.
These findings will be followed-up in the coming formal Ecofin meetings, which will form key inputs for the next Commission's strategic agenda.
On the Future of EU Competitiveness: an open discussion with dr. Mario Draghi
On the final day, Dr. Mario Draghi shared some preliminary insights on the EU competitiveness report he is preparing. A high level political discussion with the Ministers ensued without any taboos, discussing concrete solutions covering both the public and private sector and the choices we will have to make to finance the challenges we’re facing. Ministers emphasized the need to shift the perspective from identifying problems to defining concrete solutions. Dr. Draghi's comprehensive report is expected by the end of June. Afterwards, the Ecofin will further elaborate and put into action the identified solutions.
