How to achieve CMU, after all? An analysis of the recommendations for Capital Markets Union in the Draghi, Letta and Noyer reports
28 October 2024
by Maja, Giacomo, Kai Gereon: In this briefing we show how securitisation, supervision, market infrastructure and savings/pensions schemes are identified as priorities in all three reports, however with different conclusions.
The three reports by Draghi, Letta and Noyer remind policy makers that capital markets channelling savings into investments is key to competitiveness and economic growth. The recommendations of these reports could give new impetus to the long-standing flagship policy of the Capital Markets Union (CMU). In this briefing we show how securitisation, supervision, market infrastructure and savings/pensions schemes are identified as priorities in all three reports, however with different conclusions. We also discuss all other CMU recommendations in the reports.
Strengthening European competitiveness will require significant private sector investment, so it is not surprise that the reports by Enrico Letta on the Single Market and by Mario Draghi on European Competitiveness prominently present recommendations for developing European capital markets, a policy pursued since 2015 under the brand “Capital Markets Union (CMU)”. A third report has been written by a French group of experts headed by Christian Noyer. This report is exclusively dedicated to capital markets, but suggests re-branding the policy as Savings and Investments Union, a name probably closer to what businesses and citizens experience, or should experience, when dealing with capital markets.
In this paper, we try to cover all recommendations in the three reports that concern CMU in order to facilitate the ECON Committee future deliberations on the topic. We group the topics by theme with a particular focus on five areas, namely securitisation, supervision, market infrastructures, pensions and savings, and harmonisation of business law. For the overview of key CMU proposals refer to Table 1 below. The remainder of the recommendations is grouped in a shorter section entitled “other proposals”. We have selected the first four topics because they receive particular attention in all three reports, which testifies to their relevance....
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