The development and integration of capital markets of the European Union remain fundamental To deal with the challenges and economic opportunities that the EU is facing. Despite the past efforts, the progress have however been hindered by divergent national priorities, acquired interests, complex regulatory scenarios and with the time necessary so that political action translates into changes in the functioning of the markets. This is stated by a study by European Central Bank (ECB), which outlines five political priorities To overcome these barriers and better create the potential of the capital Markets Union (CMU).
Access to markets
The first priority is that of facilitate access to the capital markets, in particular through the introduction of a New European Savings Product and investment. This initiative aims to exploit successful national efforts while facing the challenges at the EU level, such as low-retail participation in Market-Based products. Would also have the advantage of Increase private pension saving rates In response to demographic changes and could have a strong positive impact on European capital markets.
Tax incentives tailor -made, flexible product design and a balance between the centralization of the EU and national flexibility are key levers for Encourage families to move the savings to high performance investments.
Harmonization and vigilance
The expansion of capital markets across the border requires further Legislative harmonization and a more integrated supervisory ecosystem. This entails greater convergence of supervision and an EU superior supervision in some areas to ensure uniform implementation of the rules, increase market trust and reduce national partiality among investors. The harmonization of capital market regulations and the strengthening of the European supervisory authorities (ESA) are essential steps in this direction.
Trading and post-training
The creation of a integrated negotiation and post-negotiation panoramasupported by digitization, is essential for capital flows without interruption throughout the EU. Progress towards legal harmonization, the development of a complete consolidated ribbon and the exploitation of the potential of new technologies such as distributed accounting technology can improve the efficiency and resilience of the titles ecosystem.
Due diligence and reporting
Since the European financial system will remain largely based on banks, the securitization It can improve the use of the banking budget to finance the royal economy.
The next revision by the Commission offers the opportunity to simplify the requirements of two diligence and reporting which can reduce administrative charges without compromising the integrity and stability of the market, while further standardization efforts, also through potential platforms, would be necessary to expand and further integrate the market.
The role of venture capital
Finally, it is essential channel capital To support the Innovative and competitive companies through greater opportunities for equity financing, in particular the venture capital. Mobilizing established public investors and encouraging institutional investors to diversify in the risk capital can unlock significant funding for startups. The reduction of barriers to entry for retail investors in equity and bond markets will further improve access to capital for innovative companies.
The hope of the ECB
According to the ECB, the implementation of these five measures has the potential for make the agenda progress of the union of the capital markets and create deeper and integrated capital markets in Europe.
“Although these proposals are potentially impacting and technically feasible, they should be integrated by long -term transformation strategies that face the structural weaknesses in the European capital markets – reads the conclusions of the relationship – these strategies include the Development of EU bonds such as safe assets, the completion of the banking union and the promotion of literacy and financial inclusion“.
By pursuing these initiatives with renewed political commitment, the Frankfurt researchers support, the EU can build a Resilient, innovative and inclusive financial system which supports sustainable economic growth and open strategic autonomy.
