Governor. ICMB. Europe in the new geopolitical landscape

Lecture by Governor José Luis Escrivá at the ICMB (Geneva) on Europe in the new geopolitical context. He argues that four transformations (geoeconomic rivalry, climate change and the energy transition, the AI revolution and new demographics) are testing the European model, and that the response is not to copy other powers but to scale up Europe's strengths at continental level. The published material is the presentation (slides).

Key points

• Demographics: Europe would lose one in five workers (aged 20-64) by 2050 without net migration.
• Trade: the rules-based order is giving way to strategic competition; average effective tariffs between the US and China, Canada and the EU have risen compared with 2024, and 'Europe is not built for economic power politics'.
• Dependencies: 57% of EU energy is covered by net imports; 99% of imported solar panels, 80% of lithium-ion batteries and 98% of rare-earth magnets come from China. China, less energy-dependent (24%), has electrified its economy much more.
• AI: over the last decade the US has invested seventeen times more than the EU.
• Proposals: the 28th regime 'EU Inc.' is welcome but should go further (fast-track insolvency for start-ups, harmonised enforcement of collateral, a single digital register, extending it to tax and labour law); deepen capital markets following the Nordic example (55.8 listed companies per million inhabitants versus 9.5 in the rest of the EU); strengthen the Blue Card; Eurosystem payments strategy (Pontes and Appia) for tokenised finance anchored in central bank money.

Who is affected

European economic policy message: capital markets union, business regulation, talent migration, payment infrastructures and tokenisation.

Plain-language version

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