Europe is facing a sense of unease as innovative and low-cost Chinese producers challenge its traditional industries and disrupt policymakers. While the continent has not been a major player in the tech revolution, with American tech giants dominating the market, President Emmanuel Macron recently emphasized the importance of economic prosperity and technological sovereignty for great power status. However, Europe lags behind in wealth per capita and must become a more attractive destination for investment and innovation.
To achieve this, Europe needs access to large amounts of capital and a streamlined financial system that can efficiently direct savings towards promising investment opportunities throughout the continent. Unfortunately, European finance remains fragmented and hindered by national boundaries, making it crucial to advance banking and capital-market reforms now more than ever. By improving its financial infrastructure, Europe can better compete in a rapidly changing global economy and secure its position as a leading economic power.