Since the Maastricht Treaty, the single market has been regarded as the crown jewel of the EU, ensuring growth and prosperity. But that is long gone. The single market is in crisis.
"The gap with the USA and the rest of the world is growing," said former Italian Prime Minister E. Letta ahead of the special EU summit in Brussels on Thursday, which is primarily focussing on the economy.
So far, the European market has been "too fragmented and not attractive enough", said Letta. For example, start-ups that develop digital technologies receive significantly less seed capital than in the USA.
The expert from Rome therefore proposes an EU-wide capital market . The fragmentation must be overcome. However, this is old hat. So far, it is mainly tax havens such as Luxembourg and Ireland that have stood in the way of integration.
His compatriot M. Draghi, the former head of the European Central Bank, goes much further than Letta. He criticises the EU for its misguided economic policy. The single market has led to wage pressure and "competitive devaluation".
Germany and the other EU states have tried to undercut and outdo each other instead of orientating themselves to the competition in the USA and China. This is why the EU has now fallen far behind.
Draghi recommends a new trade and industrial policy that is primarily modelled on the US "Inflation Reduction Act". The USA is not playing by the rules - so Europe has no choice but to follow suit.
This is also nothing new - we have repeatedly criticised it in this blog. But EU boss von der Leyen is an incorrigible transatlanticist - she has simply refused to do anything to counter the USA...
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