Kyriakos Pierrakakis, Minister of National Economy and Finance and President of the Eurogroup, emphasized the need for a change in mindset in Europe and the completion of the single market in all strategic sectors, from the French city of Aix-en-Provence, where he participated in a discussion titled “One World, Conflicting Visions: Who Sets the Standards?” as part of the “Les Rencontres Économiques d’Aix-en-Provence” forum organized by Le Cercle des Économistes.
Mr. Pierrakakis remarked:
“As for Europe, if I had to sum it up in one sentence, I would say that the era of geopolitical naivety is over. And I’m not referring only to the Russian invasion of Ukraine, but to a much deeper shift in the framework through which we perceive the world.
A second point is that the way we understand how we should use policy tools in Europe is changing radically. Let me share a brief anecdote, which, incidentally, relates to Greenland.
At the first Eurogroup meeting I chaired in January, the discussion outside the room was dominated by Greenland. Inside the room, however, we had to elect the Vice President of the European Central Bank. There were six candidates, and those with more experience than I had told me that, with six candidates, it would take months to settle on one—as is usually the case in Europe.
What my colleagues and I decided, however, was this: if we cannot elect a Vice President of the European Central Bank at a time when we are called upon to defend European sovereignty, Greenland’s sovereignty, and, more broadly, territorial integrity, then, the least one can say is that this would send an extremely negative message.
So, we elected the ECB Vice President in two and a half hours, while everyone expected the process to take four, five, or even six months.
Why am I mentioning this? Not because the way officials are elected to European institutions is of particular interest to the general public, but because it is a prime example of the political will for change. The positive thing about Europe is that we know very well what we have failed to accomplish for many years now.
There is what I would call “the dividend of the obvious.” We know that we have not completed the Capital Markets Union, the Banking Union, or the Energy Union, and we also know that we need a coherent policy on technology.
Technology will change everything, and I’m not just referring to artificial intelligence, which is the obvious topic of discussion today. A major new technological debate will follow, then another, and then another… That is why we need a comprehensive doctrine and a strategy for how to strengthen the capabilities that underpin our sovereignty.
If I had to sum it up in one sentence, I’d say that the mistake is to treat sovereignty as synonymous with autonomy. Autonomy is only one dimension of sovereignty. Sovereignty can be exercised in many different ways. And this is something that Europe itself has demonstrated.
It can be exercised through control. We have European champions. We have champions in technology. We have champions in the banking sector. What we need is a change in mindset.
And this change in mindset means that we must stop thinking in terms of national champions—French, Greek, or German—and start thinking in terms of European champions.
Do we need to do this more in every sector? Absolutely. In technology, but also in banking, on the stock markets, in every field. If we fail to develop European companies that will evolve into European—and, by extension, global —champions, they will not be able to compete internationally in a world that is transforming at an unprecedented pace due to technology.
Therefore, part of the discussion concerns policies. Another part concerns the changing international environment. But the most important aspect, in my opinion, is a change in mindset.
Given everything that is happening in the world today—and because, as I said at the beginning, the era of geopolitical naivety is now over—today’s generation of policymakers fully understands this.
All those plans that previous generations discussed for decades—whether they concern the Capital Markets Union, the Banking Union, the Energy Union, technology, or telecommunications—must now be implemented simultaneously.
Only in this way can we provide a substantive answer to your question.
That is why I am optimistic. Not only because, as Churchill’s famous saying goes, “there is no point in being anything else.” I am optimistic because I truly believe that this generation can make it happen.”
When asked whether Europe should undergo some kind of “electric shock” and take control of its internal affairs, as well as regarding interventions concerning the opportunity presented to Europe in the new world of geopolitical balances that is taking shape, the Minister said:
“The positive thing is that we know very well what the obvious things are that we have failed to do for years.
Defense is perhaps the most telling example. Are there easy, immediately implementable solutions in the field of defense? Of course there are. Today, each member state procures the same systems separately—27 different times. And yet, we all need certain common capabilities: border protection, satellites, and unmanned aerial vehicles.
The value of joint European procurement is, therefore, enormous. Have we done this before? Yes, we have. It’s called the European Space Agency. In the space sector, we have already proven that we can cooperate effectively.
The hardest part, however, is something else: making strategic choices.
What do I mean by that? We do not have unlimited resources. If we want to strengthen European sovereignty—and that is why I emphasized earlier that it is not synonymous with complete autonomy—we cannot create European versions of everything.
Today, the three major American cloud service providers hold about two-thirds of the European market. No European company currently has a market share of more than 2%. Therefore, this is not the most obvious area in which a European leader could emerge.
In 5G infrastructure, however, we had—and continue to have—significant comparative advantages. Europe has two global leaders—one in Finland and one in Sweden—which are the main competitors to Chinese companies. These are not American companies.
So what did we, as Europeans, do? Did we create a comprehensive ecosystem around these companies, especially when the first Trump administration had adopted a very specific stance on this issue? The answer is no. We still have a fragmented European telecommunications market.
We are still holding 27 different 5G spectrum auctions, and we will most likely do the same for 6G. We still do not have a clear, common strategy.
Therefore, the first step is to put our own house in order. We need to address the structural weaknesses of the European economy and the European project so that we can unleash the obvious growth potential that already lies before us.
And the second is to make strategic choices that will reduce our dependencies. The goal is not complete autonomy. It is to avoid unilateral dependencies, diversify risks, and shield Europe from the uncertainties of the future.
This is entirely achievable. And we have every opportunity to succeed.”
Regarding developments in the field of Artificial Intelligence and technology more broadly, and how these will shape the new economic reality, Mr. Pierrakakis commented:
“I would add that technology will be just as decisive a factor as geopolitics.
I would say that we tend to over-rationalize the past, dramatize the present, and underestimate the future.
Today, the pace of change is unprecedented. Technological acceleration, which once unfolded over decades, is now condensed into a very short time. Think about the transition my own generation has experienced: from video rental stores to Netflix. How long did that take? Ten, fifteen years?
In artificial intelligence, however, changes now take place within months, or even weeks.
We usually perceive the world in a linear way. But technological developments are advancing exponentially. And political systems, historically, react at a much slower pace.
This is the major challenge we face today, alongside all the other challenges we are already dealing with.
That is why we must be prepared. First and foremost, however, we must fully understand the scale and nature of the changes unfolding before us.
As Europeans, we have the capacity to respond. We have the “hardware”—the infrastructure, the capabilities, the human resources. What we lacked for many years was the “software”: the right policies and the political will.
Today, we have both.”