The Opportunity of the Savings and Investment Union

The coming decade will be decisive for Europe. The energy transition, the technological revolution, digitalisation, defence and industrial modernisation will require an unprecedented investment effort. The good news is that Europe is not starting from scratch: it has competitive companies, outstanding talent, one of the highest levels of savings in the world and strong appeal for international investors. The real challenge now is to transform these strengths into a greater capacity to finance growth.

The investment needs are enormous. Achieving Europe’s competitiveness, innovation and economic transition objectives will require mobilising private capital on a scale that can hardly be sustained through public or bank financing alone. As highlighted by the reports of Enrico Letta and Mario Draghi, the challenge is not a lack of savings, but the ability to transform those savings into productive investment and growth. The question is no longer simply how to mobilise European savings, but how to make Europe one of the world’s most attractive destinations for investment.

In an environment where capital is increasingly global, competition is no longer confined to companies or sectors; jurisdictions also compete. The most developed markets offer depth, liquidity, legal certainty and a predictable regulatory framework, factors that reduce the cost of capital and accelerate the flow of investment into the real economy. Capital seeks opportunity, but it also seeks confidence.

The Savings and Investment Union (SIU) is no longer merely a financial policy agenda. It is an economic policy in the broadest sense of the term: a necessary condition for strengthening competitiveness, fostering innovation, enhancing strategic autonomy and increasing Europe’s ability to attract the capital that will finance its future growth. Ensuring that a greater share of European savings is channelled into European projects does not mean restricting the free movement of capital. It means creating the conditions that make investing in Europe as attractive for domestic savings as it is for international capital. Regulation alone, however, will not be enough: the success of the SIU will also depend on the ability of industry and institutions to translate this framework into solutions that mobilise investment.

“The success of the SIU will also depend on the ability of industry and institutions to translate this framework into solutions that mobilise investment”

The direction is clear and there is growing consensus on the need to move forward. The time has now come to turn ambition into results. It is time to move from theory to action.

Achieving this will require further progress in regulatory integration and the development of a genuine single capital market. This also means simplifying the regulatory framework wherever possible. Simplification does not mean less regulation, but better regulation: eliminating duplication, reducing unnecessary complexity and…