European Commission President Ursula von der Leyen has urged the European Union to simplify regulations and create a unified capital market to enhance the bloc's economic growth and global competitiveness. In a closed-door meeting with EU ambassadors, von der Leyen identified burdensome regulations and energy prices as major barriers to growth, stating that "diverging national rules and trading conditions across Member States deter businesses from achieving their full potential and limit Europe's competitiveness."
The EU chief emphasized the need to move beyond the current fragmented system, noting there are over 300 trading venues across the Union—what she called "fragmentation on steroids"—compared to the single financial systems in the U.S. and China. Her proposed solution is the Savings and Investment Union, aimed at creating a single, deep, and liquid capital market. Von der Leyen plans to present a joint single-market roadmap to EU leaders at a March summit in Alden Biesen, with a goal of finalizing the EU single market by 2028.
This push comes as EU leaders gather in Belgium to address how the bloc can compete economically with China and an increasingly unpredictable United States. European growth has trailed the U.S. for two decades, with productivity and AI innovation lagging while facing potential tariff threats from a possible second Trump administration and Chinese export restrictions on critical minerals.
Germany has emerged as a strong advocate for deregulation, warning that further integration of national economies will only be possible if no additional bureaucratic burdens are imposed on industry. A German position paper circulated in Berlin calls for "specific, bold, and in some cases, uncomfortable actions" to fix trade barriers within the common market, including accepting voluntary national restrictions for the bloc's benefit.
The economic reckoning occurs alongside broader geopolitical tensions. China has threatened anti-dumping investigations into French wine or "reciprocal tariffs" on EU goods if Paris proceeds with proposed blanket tariffs on Chinese imports. Meanwhile, Britain's Chancellor Rachel Reeves declared that closer integration with Europe represents the "biggest prize" for Britain's economy, signaling a pivot toward rebuilding EU ties while maintaining that regulatory alignment will only happen when it serves national interests.
