Changes from report parliamentary committee draft to plenary report

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AddedEXPLANATORY STATEMENT

AddedThe international monetary and financial system is undergoing a gradual yet profound transformation. This report argues that the time has come for EU public institutions to play an active role in strengthening the global position of the euro, with the ambition—echoing the words of ECB President Lagarde—of transforming it from an “in-between” currency into a fully fledged international one.

AddedThe report seeks to identify the conditions under which that transition can succeed.

AddedThe rapporteur contends that one of the euro’s core weaknesses lies precisely in its current role as a passive safe haven: it absorbs shocks without Europe fully capturing the corresponding economic, financial and geopolitical benefits. By contrast, the principal levers for strengthening the euro’s international role—most notably a larger and more continuous supply of common EU safe assets and the wider use of the euro in international transactions—would also help mitigate the adverse appreciation pressures resulting from stronger global demand.

AddedEurope’s dependencies are stark, and their consequences are increasingly being felt by European citizens. The fact that individuals in Europe, including members of the International Criminal Court, have been denied access to basic banking services is a regrettable illustration of these weaknesses.

AddedAn overarching objective of the report is therefore to overcome the current lack of strategic direction in the EU’s approach to euro internationalisation, particularly when contrasted with the coordinated strategies pursued by the United States and China. Although the Commission and the ECB have launched a range of initiatives, none of them—individually or collectively—amounts to a strategy. A genuine strategy requires more than an inventory of measures: it must set clear priorities, match instruments to objectives, make explicit policy choices, and include a governance framework that ensures accountability for delivering results. Accordingly, the report calls on the Commission, in close cooperation with the ECB, to develop a comprehensive strategy for strengthening the international role of the euro and to submit it to the European Parliament and the Council for political scrutiny and regular review.

AddedTurning to the substantive conditions for strengthening the euro’s international role, the report starts from the premise that this requires its wider use across cross-border value chains. This means moving beyond a thin layer of trade invoicing towards a system in which market participants across jurisdictions can borrow, lend, hedge and settle in euro throughout those chains.

AddedNo currency can achieve that without an abundant supply of safe and liquid assets denominated in that currency. Safe assets can serve as high-quality collateral in international repo markets and provide a euro-denominated liquidity buffer alongside public backstops. This is a foundational lesson of the dollar’s dominance: the depth and liquidity of the US Treasury market are inseparable from the dollar’s international role.

AddedWe are therefore particularly pleased that, for the first time in an ECON report, the text includes a political call for the large-scale issuance of common EU debt to finance European public goods. This reflects an emerging agreement among pro-European political forces that a genuine common EU safe asset is not merely a financial instrument, but a precondition for European sovereignty.

AddedBuilding on this objective, the report also supports bringing the ESM within the EU legal but also importantly budgetary framework. Doing so would strengthen the perceived permanence and creditworthiness of its obligations, contribute to the depth and liquidity of the European safe-asset market, and provide a clearer institutional template for future joint financing operations.

AddedBeyond common public debt issuance, a genuinely sovereign and interoperable European payments and settlement infrastructure remains essential. The adoption of the EP position on Digital Euro has been a milestone. Yet Europe has not developed a cross-border wholesale central bank digital currency platform comparable to China’s initiatives. Developing interoperable arrangements between the euro area and other major monetary jurisdictions will therefore be an important strategic challenge for European policymakers over the coming decade. The report accordingly places particular emphasis on interoperability and wholesale functionality and calls for a more rapid completion of the Appia and Pontes initiatives.

AddedFinancial stability considerations run throughout the report. The rapid growth of US dollar-backed stablecoins is not a neutral technological development: it reinforces the dollar’s international dominance by increasing demand for US debt and extending the currency’s reach into new forms of digital transactions. A particular concern is the circulation within the EU of fully fungible, multi-issued dollar-denominated stablecoins. Because tokens issued by different entities are interchangeable and redeemable at par in the EU, reserves may be concentrated in the United States while redemption pressures fall disproportionately on EU-based issuers in periods of stress.

AddedAt the same time, European investors have substantial exposure to highly leveraged and potentially overvalued markets, including the US artificial-intelligence sector, while euro-area banks have become increasingly reliant on US dollar wholesale funding. The report therefore calls for financial-stability surveillance to focus not only on net current-account positions, but also on gross capital flows and the vulnerabilities arising from large cross-border financial exposures.

AddedNo single proposal in this report can, on its own, transform the euro’s international standing. Progress will depend on the combined effect of sovereign digital payments infrastructure, a deep and liquid common safe asset, the Savings and Investments Union, a coherent regulatory approach to stablecoins, and a genuine European industrial and investment strategy. We therefore look forward to the presentation, by the end of 2026, of a joint strategy for the internationalisation of the euro to the European Parliament and the Council, ensuring that this agenda receives the political ownership, coordination and follow-up it requires.