Communication: Capital Markets Union – accelerating reform

The Capital Markets Union (CMU), part of the third pillar of the Commission’s Investment Plan for Europe, is essential to delivering the Juncker Commission's priority to boost jobs, including youth employment, and growth. It seeks to better connect savings to investment and to strengthen the European financial system by enhancing private risk-sharing, providing alternative sources of financing and increasing options for retail and institutional investors.

Removing obstacles to the free flow of capital across borders will strengthen Economic and Monetary Union by supporting economic convergence and helping to cushion economic shocks in the euro area and beyond, making the European economy more resilient. This is even more important in the current economic environment.

The CMU Action Plan of September 2015 set out a comprehensive programme of actions to put in place the building blocks for the CMU by 2019 and was strongly supported by the European Parliament, Council and stakeholders. Alongside the Single Market Strategy and Digital Single Market Strategy, it sits at the heart of the European reform agenda for a deeper and fairer Single Market. In the current political and economic context developing stronger capital markets in the EU is even more important.

It is therefore essential to step up implementation and accelerate reform. The European Council of 28 June 2016 called for "swift and determined progress to ensure easier access to finance for businesses and to support investment in the real economy by moving forward with the Capital Markets Union agenda." One year after the launch of the CMU Action Plan, it is important to rapidly finalise the first wave of CMU initiatives so they can have an effect on the ground as soon as possible. It is also important to progress quickly towards the adoption of forthcoming legislative proposals.

Finally, economic and technological developments, such as the rapid growth of FinTech or the need to build more sustainable finance, have the power to transform EU capital markets. Taking account of the changing political context, the Commission is taking forward the further priority areas needed to complete the CMU and will undertake a mid-term review in 2017.

• Primary Source

ESO: Background information: State of the Union 2016: Completing the Capital Markets Union - Commission accelerates reform http://www.europeansources.info/record/state-of-the-union-2016-completing-the-capital-markets-union-commission-accelerates-reform/

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