The release of the ECB report on “Financial integration and structure in the euro area” is an excellent opportunity to share some thoughts on the European capital markets union or CMU project.
Well-functioning and innovative capital markets are essential in enabling firms, households and governments to access stable funding and saving opportunities that are vital for consumption, investment and, ultimately, economic growth and employment.
One could even argue that the CMU is a common denominator across many – if not all – EU strategies and a pillar for strengthening the EU’s autonomy on the global stage.
Without progress towards a fully-fledged CMU, we will face significant difficulties in effectively addressing the global challenges facing the EU.
Further developing and integrating EU capital markets takes on even more urgency in light of the challenges posed by the United Kingdom’s departure from the EU.
Last, but certainly not least, there are strong synergies between the completion of the CMU and the finalisation of the banking union.
Though the world of finance may sometimes seem distant or arcane, it is more important to people’s everyday lives than many might think.
For one, badly functioning financial systems have the potential to harm all of us – as the experiences of 2008 and beyond have shown.
*This text was originally produced for the Bank for International Settlements