Livolsi: “Yes to the single capital market, but speed up the fiscal union”

The analysis of Ubaldo Livolsi, professor of Corporate Finance and founder of Livolsi & Partners S.p.A., in the new appointment with his column with the Dire agency, edited by Angelica Bianco

ROME – “This is what I have long supported for Italy: the over 5,200 billion euros of financial wealth of our compatriots should support and be invested in the capital of companies to make our economy stronger and more competitive. Now, the Union too European Union seems to be going in this direction. This is thanks to the report on the Single Market – commissioned by the President of the Commission Ursula von der Leyen and produced by Enrico Letta, former President of the Council of Ministers of our Republic – which has not been talked about enough and has been some fundamental aspects have been overlooked”.

Ubaldo Livolsi, professor of Corporate Finance and founder of Livolsi & Partners S.p.A., in the new appointment of its column with the Dire agency, edited by Angelica Bianco.

“European companies – he explains – are lagging behind in terms of innovation and growth compared to their competitors in the USA, China and India. Without equity our companies are unable to counter both the protectionism with which the United States tries to cut off competition, and the policy of the Beijing Government, which aims to capture and internalize all parts of the value chain in advanced and clean technologies and to ensure access to the necessary resources.

It is therefore essential that the Union finds a way to allocate and channel the 33 trillion euros of private savings of its citizens to companies. One fact above all: EU start-ups receive less than half the funding of US ones.

European companies, if enabled to invest in human capital, new technologies and innovation, will grow the economy of the 27. That Brussels is working in this perspective is good news in light of the fact that the Pact is back in force of stability, which was suspended in 2020 due to Covid. The reform introduces new margins of flexibility, but the ceilings of 3% and 60% of GDP remain for the deficit and debt. In particular, the new rules provide that countries with public debt exceeding 60% of GDP will have to present four-year reduction plans by 20 September 2024, which can be extended to seven in exchange for reforms and investments”.

“Enrico Letta’s proposals – continues Livolsi – are complementary with those of the report on competitiveness, also wanted by von der Leyen, on which the former prime minister and president of the ECB Mario Draghi worked, which not surprisingly has as one of the three fundamental points, in addition to decarbonised and autonomous energy systems and integrated EU defence, digital innovation is essential. To overcome the natural resistance of the Nordic countries, led by Germany, it is essential to think of innovative savings tools that allow citizens to have good interest rates, which are not risky and eminently speculative, but connected to European projects, I am thinking for example of the financing of the energy transition and the objective of making Europe the climate neutral and most competitive area on the planet by 2050 A financial education policy among European citizens will therefore be necessary.”

“Even if the European fiscal union is a difficult goal to achieve – which sooner or later will have to be achieved – due to the differences in income and wealth between the various countries, it is clear that it will be necessary to harmonize the tax regulatory frameworks of the member states. The hope – he concludes – is that the new European Parliament that will be elected in the upcoming elections of 6-9 June will have the creativity to define a single European tax system, as happened, mutatis mutandis, when the Parliament promoted the convening of an extraordinary session of interparliamentary meetings, which in 1990 unblocked the negotiations that led to the Treaty of Maastricht, the founding act of the European Union, which laid the foundations for the birth of the euro”.