The Savings and Investment Union (SIU) and its role in mobilising the savings of European citizens, digital finance and the digital euro, as well as the broader agenda of simplifying and deepening the single market, were the focus of a panel at the IE Competitiveness Hub, on the challenges and prospects for European competitiveness.
The panel included Kyriakos Pierrakakis, Minister of Economy and Finance and President of the Eurogroup, while the discussion, moderated by Financial Times journalist Paola Tamma, also included former Italian Prime Minister and former Economy Commissioner Paolo Gentiloni and Spanish Deputy Prime Minister and Economy Minister Carlos Cuerpo.
In response to a question about the effort to create unity through the E6 initiatives, the Minister said: “Any initiative that moves us forward is positive. We know what we need to do. Enrico’s report and Mario’s report are the north of the compass. Yes, both are from Italy, and I would say they are the Pope and the Patriarch, but now we have two Popes. So we know what we have to do. The challenge of implementation lies with the Ministers of Finance.”
And add: “The Commission is doing an excellent job. Maria Luisa Albuquerque’s work is absolutely focused, with specific content. We are currently discussing all aspects of the Savings and Investment Union. The challenge is on our side to make it happen. So we need the right mechanisms within the group to be able to implement all the elements of the Savings and Investment Union.”
As Mr. Pierrakakis, “First of all, we need to be able to ‘roll it out’ communicatively to the citizens, because Roberta Metsola mentioned this earlier. When I have to explain, I guess the same goes for Carlos, what the Savings and Investment Association is and what it means to the citizens, we have to be able to deliver it concretely.”
People understand the Erasmus programme, they understand free roaming. But what is SIU for them? For example, yesterday we discussed the Kukies and Noyer report. I take a startup and turn it into a scale-up. Should it become a company in Delaware and get US interim funding or should it be able to grow in Europe? That’s very specific for this category.
So we need to be able to unfold all these elements and then our job is to find consensus, I guess. That is, to a very large extent, the job of the Eurogroup chairman, to be able, in this informal institutional framework, to form a consensus.
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Is it a good thing that the larger countries have an informal forum to shape this consensus? Well, to the extent that it works as a facilitator, I think that’s a good thing. It will all depend on whether, at the end of the day, strategy becomes synonymous with implementation. It depends on us. But, frankly, for that to happen, the national reservations that exist should not prevail; we all say that we agree with the Savings and Investment Association or any other initiative in principle.
There is a “but” that follows the initiative. And we all have these national parameters, depending on the portfolio, depending on the issue. The question is how well we understand that the opportunity cost is just as tangible as the actual cost. And right now we understand that, and we also understand it because of the exogenous nature of the events around us.
Russia invaded Ukraine, so we realized that we need to strengthen our defense capabilities, but also, frankly, the era of geopolitical innocence is over. And we understand that we need to become not only a single market, but probably more than that. And to do that, we need to strengthen defense and also have a doctrine in technology, in technology strategy.”
According to Mr. Pierrakakis, “Anthropic-Mythos was the topic of the day, along with what’s going on in Washington. Anthropic-Mythos is an issue. How you manage a particular LLM and access to it is another. But there is much more to discuss.
We are overdramatizing what we have in front of us, overdramatizing the present and underestimating the future. And when it comes to technological innovation, frankly, the future is not years away; it’s weeks away. What you see today with Anthropic, you can easily see in a few weeks with more companies developing similar algorithms and equally powerful models. And that will only be what we know.
So the question is: what kind of governance arrangements are we going to develop and what kind of common understanding can we cultivate among ourselves about technological dominance.
When we talk about technological dominance at the level of finance ministers, do we all mean the same thing? Are we using the same vocabulary? Do we have the same strategy as Europeans? Are we trying to create European champions, as Enrico’s report predicts? Or are we sticking to small national logics, whether in banking or in technology? If we don’t understand that we have to do the latter, I think we will miss a great opportunity.”
Then Mr. Pierrakakis, in response to a question about the digital euro and whether it could play a role in strengthening European funding, said that “Digital Funding is an area where we hope to have a joint statement at the Eurogroup in July. In general, this is a huge opportunity for Europe. If we look at it as a whole: what are the Americans doing? They have the institutional and regulatory framework, but they don’t have a digital dollar. They are allowing dollar-based stablecoins and that will be their key strategy: private innovation around their currency, in digital form. China is doing the exact opposite: they want a fully digital currency without allowing stablecoins. In our case, we have the MiCA. But if you look at the world today, 95% of stablecoins are pegged to the dollar and less than 1% to the euro. So the key strategy is to implement the digital euro. We hope that, from the European Parliament’s point of view, this will be voted on this year, quite soon.”
As he said, “the Fed has not chosen to move to a digital dollar. It’s primarily prioritizing privacy issues, but I suppose that’s partly a cultural issue as well. In our case, creating a public infrastructure for payments and clearing, with the spillover benefits it can bring, is a very positive development. 2029 as a time horizon is acceptable, but generally, when we talk about technological innovation, whether in finance or elsewhere, innovation happens now, in weeks, not in months or years.
We are missing opportunities every week, every month and every year that goes by. So these opportunity costs are tangible. I believe that European legislators understand that. And I believe that the project will come to fruition. And frankly, it will be one of the first to be fully implemented on a large scale. And the impact will be quite positive. It’s good to have a strong public infrastructure that will serve the business system.”
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