Sittings · Document
On the global role of the euro
Committee on Economic and Monetary Affairs · Rapporteur: Rasmus Andresen
This is a draft report by the Committee on Economic and Monetary Affairs on the global role of the euro. It calls for the EU to reduce strategic dependencies and strengthen its capacity for autonomous action.¶ It asks the Commission to tie access to EU investment programmes to euro invoicing, and to promote the euro in trade agreements, invoicing, procurement and payments.¶ It supports a European central bank digital currency and a deep and liquid common European safe asset, and backs a European debt agency and an EU sovereignty fund.¶¶¶ It warns about US dollar stablecoins and about EU banks' reliance on US dollar wholesale funding, and asks the Commission to clarify that multi-issuance stablecoin schemes are not permissible under the Markets in Crypto-Assets Regulation.¶¶ It calls on the Commission and the ECB to present a joint euro internationalisation strategy to Parliament and the Council by the end of 2026.¶
Committee position. The rapporteur proposes that Parliament call for the EU to reduce strategic dependencies, strengthen the euro's international role through a coherent public strategy, and support a European CBDC, a common safe asset, a European debt agency and an EU sovereignty fund.¶¶¶
Key points
- Notes the transformation of the international monetary and financial system and calls for the EU to reduce strategic dependencies and strengthen autonomous action.¶
- Notes that safe-haven inflows have turned the euro area into a 'passive safe haven' that absorbs shocks from elsewhere without fully harnessing the benefits.¶
- Underlines EU dependence on foreign financial market infrastructures, from retail payments reliant on international card schemes to wholesale transactions dependent on US systems, and euro area banks' reliance on US dollar wholesale funding.¶¶
- Stresses that such dependencies expose EU citizens and firms to extraterritorial sanctions from non-EU countries, and agrees with the ECB President on the need for the euro to move to being a full international currency.¶¶
- Considers that internationalisation of the euro is about strengthening its role in a more multipolar system, and that it requires a coherent public strategy, as the US and China pursue for their currencies.¶¶
- Calls on the Commission to make access to EU investment programmes conditional on euro invoicing across value chains, promote the euro in trade agreements, and work with industry on invoicing, procurement and payments.¶
- Emphasises the need for a sovereign European public digital payments and settlement infrastructure with a European central bank digital currency at its core, and supports the ECB's Pontes and Appia wholesale initiatives.¶¶
- Stresses the need to develop bilateral swap lines with EU Member States and expand Eurosystem international liquidity backstops to partner jurisdictions, including in the Global South.¶
- Calls for a deep and liquid common European safe asset, with issuance reaching 20% of the EU's GDP, through new common issuance and exchange of national sovereign debt into common EU bonds.¶¶
- Supports a European debt agency anchored in the EU's budgetary framework to consolidate existing borrowing programmes and future common issuance.¶
- Warns that US dollar-backed stablecoins reinforce dollar dominance, and urges the Commission to clarify that multi-issuance schemes are not permissible under the Markets in Crypto-Assets Regulation.¶¶
- Warns of financial stability risks from a correction in highly leveraged markets, including the AI sector in the United States, and calls for monitoring gross capital flows; supports an EU sovereignty fund and a joint euro internationalisation strategy by the end of 2026.¶¶¶
Who is affected
- EU citizens and firms, exposed to extraterritorial sanctions from non-EU countries.¶
- Euro area banks, reliant on US dollar wholesale funding.¶
- Market participants across jurisdictions, needing to borrow, lend and settle in euro.¶
- EU and non-EU entities issuing US dollar-denominated stablecoins in the EU.¶
- EU Member States, for bilateral swap lines.¶
Written by a language model from the full text only; every figure comes from the text and ¶ links to the paragraph it rests on. Check the text itself before relying on it.