Remarks by Commissioner McGuinness at the press conference on the fostering the openness, strength and resilience of Europe's economic and financial system

Good afternoon ladies and gentlemen.

Thank you for that overview Valdis.

As you have just laid out, we are living in a changed geopolitical context and a multipolar world.

The rules-based, multilateral global governance system is being challenged by certain countries pursuing unilateral short-term interests.

The COVID crisis has shown some of the weaknesses in the global economic and financial system. It has also accelerated the pace and scale of technological and societal changes.

So in this changing context we are setting out what we want the European economic and financial system to look like in this changed context.

First to be clear. We want to be open to the rest of the world and to play our full role on the world stage.

To do that, we need to be strong and resilient at home.

Many of our existing initiatives will help us with that goal.

Completing the Banking Union will keep our banking sector secure, well supervised and resistant to shocks.

Developing the Capital Markets Union will widen access to capital, helping to drive the green and digital transitions.

And Next Generation EU will promote Europe's economic recovery after the pandemic.

But we also need to consider Europe's place in the global system.

These measures we are proposing today are necessary for the European Union to continue to shape the global economic and financial system, while protecting itself from unfair and abusive practices.

The first part of our plan is a stronger international role of the euro.

Paolo will talk about this in more detail.

With the ECB, we are assessing issues related to the possible introduction of a digital euro, as a complement to cash, and I welcome the joint technical group that Valdis has just referenced.

The second element is to strengthen EU financial market infrastructures and increase their resilience.

This is a key financial stability issue. These infrastructures are at the heart of our financial system and they carry out critical functions.

They are the gateways to foreign financial markets, benefiting EU companies and investors. But this also means that they can be vulnerable to actions by third countries, including unlawful extra-territorial sanctions.

We will explore how to improve the resilience of clearinghouses and settlement operators.

In cooperation with the ECB and the European Supervisory Authorities, we will engage with relevant market players to carry out a thorough analysis of the vulnerabilities of EU financial market infrastructures.

We will also look at how to secure the uninterrupted flow of financial services, including payments, from the EU to entities or third countries targeted by unlawful extraterritorial sanctions.

And we'll take the necessary actions to address such vulnerabilities.

Finally, we need to assess how to reduce excessive reliance on foreign investment banks and funding in foreign currencies, and avoid over-reliance on foreign financial market infrastructure providers.

For example, on Central Counterparties, the fact that a large proportion of euro-denominated contracts are cleared outside the EU is a point of vulnerability.

And the message to the industry is clear - financial entities in the EU are expected to reduce their exposures to UK CCPs, and CCPs within the EU must build up capacity.

The third part of today's Communication is about the effective implementation of EU sanctions and countering unlawful sanctions by third countries.

EU restrictive measures are a key foreign policy tool that help us uphold our values. And we need to make sure that they are implemented effectively and achieve their intended aims.

This year, we will develop a dedicated database, the Sanctions Information Exchange Repository, allowing Member States and the Commission to exchange information on the implementation and enforcement of sanctions. This database will give us more detail, more promptly on the impact of our sanctions.

We will work with Member States to establish a single contact point for enforcement and implementation issues with cross-border dimensions.

We'll also set up an anonymous system to report sanctions evasion.

Unlawful extraterritorial sanctions by third countries can hinder legitimate trade and investment. So the Commission will consider how to update the Blocking Statute, which is the legislation currently in place to deal with this issue.

In parallel, the Commission and High Representative Vice-President Borrell will continue to work with our partners to align our sanctions and their implementation to the greatest possible extent.

I have highlighted the key elements in today's Communication.

Making our financial system and economy stronger, more open, and more resilient is our ambition, backed by determination.

This will not only enhance our financial system but will also give much needed support to our economy: to our small businesses, innovative start-ups and sustainable investments.

And it will set Europe up for the long-term as we promote our aims and our values on the world stage.