EU to DO 2015-2019

Memos to the new EU leadership.

Publishing date: 04 September 2014
Authors: André Sapir Nicolas Véron Zsolt Darvas Reinhilde Veugelers Carlo Altomonte Georg Zachmann Jim O‘Neill Rainer Münz Guntram B. Wolff Silvia Merler Mario Mariniello Suparna Karmakar

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‘There is now a distinct possibility that this crisis will be remembered as the occasion when Europe irretrievably lost ground, both economically and politically’. This was the starting sentence of our memos to the new EU leadership five years ago. Five years later, it is fair to say that this possibility has become a reality. Unemployment has reached record levels and growth has disappointed. Meanwhile, the world outside the EU has continued to change rapidly. Emerging markets in particular have increased their weight in the global economy and in decision making.

The new EU leadership – the president of the European Commission and his team of commissioners, and the presidents of the European Council and of the European Parliament – will have to address pressing challenges. Despite the significant steps taken by Europe – among them the creation of a European Stability Mechanism, the start of a banking union, the strengthening of fiscal rules and substantial structural reforms in crisis countries – results for citizens are still unsatisfactory. It is impossible to summarise all the memos in this volume but a common theme is the need to focus on pro-growth policies, on a deepening of the single market, on better and more global trade integration. Reverting to national protectionism, more state aid for national or European champions – as frequently argued for by national politicians – will not be the right way out of the crisis. On the contrary, more Europe and deeper economic integration in some crucial areas, such as energy, capital markets and the digital economy, would greatly support the feeble recovery. But in other areas, less Europe would also be a highly welcome signal that the new European leadership is serious about subsidiarity. Internal re-organisation of the European Commission to ensure that it better delivers would also be welcome.

Beyond the pressing challenges – above all crisis resolution, jobs and growth – the memo to the presidents recommends that the new EU leadership should make sure that Europe makes the necessary treaty changes to strengthen Economic and Monetary Union and to permit the coexistence within the EU of countries belonging to the euro area and those that have no intention to join it. Working towards a consensus on this within the European Council and with European citizens is crucial for Europe’s future and to enable bold decisions on pressing issues.

Our focus in these memos is on economics. But clearly, political and other challenges have multiplied in the last five years. We therefore offer strategic policy advice that we deem both sensible given the problem at hand and politically achievable.

Regrettably, we have unexpectedly not been able to include in this volume a memo to the new Commissioner for Employment and Social Affairs. Yet, we believe that this Commissioner will have the major task of setting out how to improve Europe’s employment and social performance. In many countries, labour market institutions need to be modernised, for instance by making unemployment insurance systems more efficient. Benchmarking could be a way of converging on more sustainable and equitable social models. But reducing unemployment rates will also require better macroeconomic policies, on which the new Commissioner for Economic and Financial Affairs will have an important role to play.

The memos have all been written by Bruegel scholars and their preparation has been coordinated by Senior Fellow André Sapir. Like all Bruegel publications, the content reflects the views of the author(s), and there has been no intention to write a ‘Bruegel programme’. But the memos have been discussed extensively within the team to improve quality and ensure coherence.

Throughout the preparation of this volume, Bruegel’s editor Stephen Gardner has contributed considerably to improving the formal and substantive quality of the individual memos. Our gratitude goes to him as well as to all of those who have given feedback on drafts of specific memos.

André Sapir and Guntram Wolff

September 2014

About the authors

André Sapir

André Sapir is a Senior Fellow at Bruegel. He specialises in international economics.

He covers European integration, monetary union, international trade, international policy coordination and globalisation.

He speaks English and French.

He is also Professor Emeritus at the Université libre de Bruxelles (ULB) and Research Fellow of the Centre for Economic Policy Research (CEPR). Previously, he served as Member of the General Board (and Chair of the Advisory Scientific Committee) of the European Systemic Risk Board based at the European Central Bank and as External Member of European Commission President Barroso’s Economic Advisory Group. In 2004, he published 'An Agenda for a Growing Europe', a report to the president of the Commission by a group of independent experts known as the Sapir report. At the time, he was serving as Principal Economic Advisor to European Commission President Prodi, also heading his Economic Advisory Group. Prior to that he worked as Economic Advisor to the Director-General for Economic and Financial Affairs at the European Commission. He holds a PhD in Economics from the Johns Hopkins University in Baltimore.
Nicolas Véron

Nicolas Véron is a Senior Fellow at Bruegel and at the Peterson Institute for International Economics in Washington, DC. His research is mostly about financial systems and financial reform around the world, including global financial regulatory initiatives and current developments in the European Union. He was a cofounder of Bruegel starting in 2002, initially focusing on Bruegel’s design, operational start-up and development, then on policy research since 2006-07. He joined the Peterson Institute in 2009 and divides his time between the US and Europe.

Véron has authored or co-authored numerous policy papers that include banking supervision and crisis management, financial reporting, the Eurozone policy framework, and economic nationalism. He has testified repeatedly in front of committees of the European Parliament, national parliaments in several EU member states, and US Congress. His publications also include Smoke & Mirrors, Inc.: Accounting for Capitalism, a book on accounting standards and practices (Cornell University Press, 2006), and several books in French.

His prior experience includes working for Saint-Gobain in Berlin and Rothschilds in Paris in the early 1990s; economic aide to the Prefect in Lille (1995-97); corporate adviser to France’s Labour Minister (1997-2000); and chief financial officer of MultiMania / Lycos France, a publicly-listed online media company (2000-2002). From 2002 to 2009 he also operated an independent Paris-based financial consultancy.

Véron is a board member of the derivatives arm (Global Trade Repository) of the Depositary Trust and Clearing Corporation (DTCC), a financial infrastructure company that operates globally on a not-for-profit basis. A French citizen born in 1971, he has a quantitative background as a graduate from Ecole Polytechnique (1992) and Ecole Nationale Supérieure des Mines de Paris (1995). He is trilingual in English, French and Spanish, and has fluent understanding of German and Italian.

In September 2012, Bloomberg Markets included Véron in its second annual 50 Most Influential list with reference to his early advocacy of European banking union.
Zsolt Darvas

Zsolt Darvas is a Senior Fellow at Bruegel and a part-time Senior Research Fellow at the Corvinus University of Budapest. He joined Bruegel in 2008 as a Visiting Fellow, and became a Research Fellow in 2009 and a Senior Fellow in 2013.

From 2005 to 2008, he was the Research Advisor of the Argenta Financial Research Group in Budapest. Before that, he worked at the research unit of the Central Bank of Hungary (1994-2005) where he served as Deputy Head.

Zsolt holds a Ph.D. in Economics from Corvinus University of Budapest where he teaches courses in Econometrics but also at other institutions since 1994. His research interests include macroeconomics, international economics, central banking and time series analysis.

Personal website: https://www.darvas.online/
Reinhilde Veugelers

Reinhilde Veugelers is a Senior Fellow at Bruegel. She specialises in industrial organisation, innovation and science.

Recently, she has covered novelty in technology development; international technology transfers through multinational enterprises; global innovation value chains; young innovative companies; innovation for climate change; industry-science links and their impact on firms’ innovative productivity; evaluation of research and innovation policy; explaining scientific productivity; researchers’ international mobility and novel scientific research.

She speaks English, Dutch and French.

Reinhilde is also a Professor at KU Leuven at the Department of Management, Strategy and Innovation and a Senior Fellow at the Peterson Institute for International Economics. She is a CEPR Research Fellow and a member of the Royal Flemish Academy of Belgium for Sciences, the Academia Europeana, the Board of Reviewing Editors of the journal Science and a co-PI on the Science of Science Funding Initiative at the National Bureau of Economic Research (NBER). From 2004-2008, she was on academic leave as advisor at the European Commission (Bureau of European Policy Analysis). She served on the European Research Council's (ERC) Scientific Council from 2012-2018 and on the Real-time earthquake risk reduction for a resilient Europe (RISE) Expert Group, advising the commissioner for Research. She holds a PhD in Economics from KU Leuven.

Websites:
https://feb.kuleuven.be/reinhilde.veugelers
https://bruegel.org/author/reinhilde-veugelers/
Carlo Altomonte

Carlo Altomonte was a Non-resident Fellow at Bruegel. He is Professor of Economics of European Integration at the Social and Political Sciences Department of Bocconi University, and a core faculty member of SDA Bocconi School of Management, where he teaches International Business Environment. He has received the SDA Bocconi Teaching Excellence Award in 2007 and the Bocconi Teaching Innovation Award in 2016. He has been a founder, and the first Director, of the World Bachelor in Business, a unique undergraduate triple degree in Business jointly developed by Bocconi University, the University of Southern California and the Hong Kong University of Science and Technology.

He is currently the Director of the Globalization and Industry Dynamics unit at the Baffi-Carefin centre of research of Bocconi University and a Senior Researcher at ISPI, the Italian centre of Studies on International Politics. He has been visiting scholar at the Centre of Economic Performance of the London School of Economics and at the Research Department of the European Central Bank. He has been a visiting professor at the Paris School of Economics (Panthèon-Sorbonne, Paris, France) and KU Leuven (Belgium), and has held short teaching courses at the Wagner School of Government (NYU, New York), Keio University (Tokyo), Fudan University and CEIBS (Shanghai) among others.

He has been regularly acting as consultant for a number of national and international institutions, including the Italian Government, the United Nations (UNCTAD), the European Parliament, the European Commission and the European Central Bank, analysing the role of international trade and investment and their implication for competitiveness.

His main areas of research and publication are international trade and investment, the political economy of globalization and its implication on competitiveness. He has published in several leading academic journals, among which Journal of Industrial Economics, European Economic Review, Economic Policy, International Journal of Industrial Organization, Journal of Economic Geography, Journal of International Business Studies, Oxford Bulletin of Economics and Statistics.
Georg Zachmann

Georg Zachmann is a Senior Fellow at Bruegel, where he has worked since 2009 on energy and climate policy. His work focuses on regional and distributional impacts of decarbonisation, the analysis and design of carbon, gas and electricity markets, and EU energy and climate policies. Previously, he worked at the German Ministry of Finance, the German Institute for Economic Research in Berlin, the energy think tank LARSEN in Paris, and the policy consultancy Berlin Economics.
Jim O‘Neill

Jim was a Visiting Research Fellow to Bruegel. He conducted research on aspects of changing global trade, global governance, and measuring better and targeting higher sustainable economic growth.

Lord Jim O’Neill is Chair of Chatham House. His previous roles include Joint Head of Research (1995–2000), Chief Economist (2001–2010) and Chairman of the Asset Management Division (2010–2013) at Goldman Sachs; creator of the acronym BRIC (Brazil, Russia, India, China); Chair of the City Growth Commission (2014); Chair of the Review on Antimicrobial Resistance (2014–2016); and Commercial Secretary to the Treasury (2015–2016). He is a board member and a founding trustee of the educational charity SHINE. Lord O’Neill was made a Life Peer in 2015 and serves as a crossbench member of the House of Lords. He is an honorary professor of economics at the University of Manchester (United Kingdom) and holds honorary degrees from the University of Sheffield, University of Manchester, University of London and from City University London (United Kingdom). He received his doctorate from the University of Surrey (United Kingdom), where he is now a visiting professor.
Rainer Münz

Rainer Münz is visiting professor at the DPP and an expert in Demography and international migration. He has been working as an academic, in the private sector and as government adviser.

Between 2015 and 2019 he was Adviser on Migration and Demography at the European Political Strategy Centre (EPSC), the in-house think tank advising European Commission President J.C. Juncker during his time in office. In 2020-21 he worked at the Knowledge Centre on Migration and Demography (JRC-KCMD) of the European Commission in Ispra, Italy.

Prior to joining the European Commission, Rainer Münz was – between 2005 and 2015 – Head of Research and Development at Erste Group, a Central European retail bank headquartered in Vienna. He also worked as Senior Fellow at the European think tank Bruegel (Brussels), the Hamburg Institute of International Economics (HWWI) and at the Migration Policy Institute (MPI, Washington DC).

Until 2004, Rainer Münz had an academic career as researcher at the Austrian Academy of Sciences, 1980-1992, and at the Department of Mathematics of Finance/ TU Vienna, 2002-2004, as well as a tenured university professor at Humboldt University, Berlin, 1993-2003. He also was visiting professor at the Universities of Bamberg, UC Berkeley, AU Cairo, Frankfurt/M., HU Jerusalem, Klagenfurt, St. Gallen (HSG), Vienna and Zurich.

In 2000-01, Rainer Münz was member of the German commission on immigration reform (Suessmuth commission). Between 2008 and 2010, he was Member of the high level “Reflection Group Horizon 2020-2030” of the European Council (Gonzales commission). Between 2015 and 2019, he was chair of IOM's Migration Advisory Board. Currently he is one of the chairs of a TWG of KNOMAD, the World Bank’s Global Knowledge Partnership on Migration and Development (since 2013). He also is member of the Experts Council on Integration advising the Austrian government.
Guntram B. Wolff

Guntram Wolff is a Senior Fellow at Bruegel. He specialises in a range of issues, including defence economics, geoeconomics, climate policy and European governance.

He covers topics such as European rearmament and the geoeconomics of trade, finance, climate policy and euro area fiscal policy.

He speaks English, German, and French.

He is a Professor of Economics at the Université libre de Bruxelles (ULB) and also a fellow at the Kiel Institute for the World Economy. Previously, he was the director of Bruegel (2013-22) and the German Council on Foreign Relations (2022-24). He worked on the macroeconomics and governance of the euro area at the European Commission and the research department at the Bundesbank. He also worked as an external adviser to the International Monetary Fund. From 2012-16, he was a member of the French prime minister’s Conseil d’Analyse Economique. He holds a PhD in Economics from the University of Bonn.

His detailed CV and publications are available at www.guntramwolff.net
Silvia Merler

Silvia Merler, an Italian citizen, is a Non-resident Fellow at Bruegel and the Head of ESG and Policy Research at Algebris Investments.

She joined Bruegel as Affiliate Fellow in August 2013. Her main research interests include international macro and financial economics, central banking and EU institutions and policy making.

Before joining Bruegel, she worked as Economic Analyst in DG Economic and Financial Affairs of the European Commission (ECFIN). There she focused on macro-financial stability as well as financial assistance and stability mechanisms, in particular on the European Stability Mechanism (ESM), providing supportive analysis for the policy negotiations.
Mario Mariniello

Mario Mariniello is a Non-resident Fellow at Bruegel. He specialises in digital and competition policy.

He covers digital policy, the economics of digital markets, competition policy and the impact of technology in labour markets. He also researches the data economy, digital market regulation and artificial intelligence.

He speaks English and Italian.

Mario is also a Visiting Professor at the College of Europe (Natolin). He was previously a Senior Fellow at Bruegel, where he launched and led the “Future of Work and Inclusive Growth” project. He formerly taught at the University of Namur, the Université Libre de Bruxelles and the University of Florence. He was Digital Adviser at the European Political Strategy Centre (EPSC), an in-house European Commission think-tank that operated under the authority of former Commission President Jean-Claude Juncker, served as member of the Chief Economist Team at DG Competition and worked on the use of artificial intelligence in workplaces at DG Employment. He holds a PhD in Industrial Organization from the European University Institute (Florence, 2008), a MSc in Economics (Turin, 2003), a BA in Political Science (Florence, 2002) and a BA in Philosophy (KU Leuven, 2025).
Suparna Karmakar

Suparna Karmakar is an Indian citizen and a Marie Curie fellow at Bruegel from 2 May 2013 to 1 August 2014.

Her research interests include the multilateral trade negotiations versus regionalism, regulatory barriers and technical standards impeding multilateral and regional trade in goods and services, and market access (including trade facilitation) policy and negotiation issues arising therefrom. At Bruegel she will work on the future of trade multilateralism and the changing role of WTO as the premier multilateral trade negotiating forum.

Suparna holds a Ph.D. in Economics from Jawaharlal Nehru University of New Delhi. In India Suparna has worked in renowned trade research institutes like the Indian Council for Research on International Economic Relations (ICRIER) and the Centre for WTO Studies (CWS), IIFT, while her international engagements have been as visiting fellow with the Institute of South Asian Studies (ISAS), National University of Singapore (2009) and the ADB Institute, Tokyo (2010). Suparna has also worked as a Consultant on various Government of India-commissioned projects on preferential and multilateral service trade liberalisation, non-tariff barriers and other regulatory restrictions for market access in manufactured goods and services.

Theme: Energy and climate policy Global economy and trade Macroeconomic policy and governance Microeconomic policies Banking and capital markets
Keyword: migration European single market European neighbourhood policy european monetary union euro area eu governance energy digital economy competition policy climate change
Language: English