whatever it takes, 3 words credited with saving the earth and collapse in 2012. but mario druggie demonte said them recently took on an even bigger task, saving your, your ups, economic future. it may sound boring, but i promise you, it isn't. this isn't just about things like tyre of, so g, d, p, your interest rates. it's but some fundamental things which many people here in europe. i've come to take for granted prosperity, security. democracy. recently really strong. you dedicates almost $400.00 pages to exam or easy be cheap, the special challenge facing the you economy. the central message, europe is not productive or innovative enough. and if it doesn't take action now and won't be able to survive and the world was ever more hostile to us. in this episode, we speak to the same retarding prime minister enrico let the, the, your group president pass code on it. to other people. task was we making the you

economy for the world and wasn't designed. we are in the right, a lot of situation. we have to move, we have to act. i definitely think there's an awareness to monk flow for. it's all over europe regarding the degree to which the world is changing. and we ask one of the leading commentators in the global economy. what's at stake if the u comes of short, this free, easy suspension for europe? if he doesn't solve these problems, it could literally collapse. welcome to business beyond. the eu has 5th, several defining questions over the last 15 years for the global financial crisis to the fund demik to the warren ukraine. and as a re election to the us presidency of donald trump for a 2nd term has res. yet more existential questions for you or training says you will put carrots on your pain. exports to the us, particularly on industrial sectors like car making at a time when they're struggling. he has also repeatedly warranty you,

nations to increase their defense spending. one of the presidents of the country stood up said, well sir, if we don't pay and were attacked by russia, what do you protect us? i said, you didn't pay your delink, which you said, yes. let's say that happens. no, i would not protect you. in fact, i would encourage them to do whatever the hell they was. you gotta pay, you gotta pay your bills. i think this is a very profound shift in the world environment. in my own view is that she's probably the most profound shift in the world environment of my lifetime. martin wallace is a former world bank economist who has been the financial times chief economic commentator for almost 30 years. he thinks from 3 election has fundamentally changed things for europe and everyone else. well, my own view, alas, and it's immensely tragic. i news that what advice lee is that

trump's free election is going to approve a historic event, possibly in the reversible one? for 1st of all the us itself and the way it operates, the us as a guarantor of security in the us as the country that created for as a defended leading to national liberal. ready or broadly defined that's clearly going to be radically different. and a part of that is a security relations. and probably these economic relations, given what he has said about tire of some defense trunks. victory is forcing your up to confront some hard truths about his phone, economic standing, particularly in relation to the us, but also in the world as a whole. using g d p, the standard measure of the value added to an economy through the production of goods and services. we can see has a gap between the size of the u. s. and e u. economies has whiten since 2010, told to each to g d p that represents less than 3 quarters of the us total.

20 years ago, you accounted for a quarter of global gdp just behind the us on way ahead of china. after that, both of us and you shares declined as china experienced a dramatic search. over the last decade, the u. s. chair has increased again while the use has been steadily declining. beyond all the individual crises that the you assessed. it was known for a while. it as a bigger problem, which it must handle. that's why it is compiled to major reports recently focusing on 2 economic areas. one, it's single marcus. i'm to, it's ability to compete in a world economy that's increasingly dominated by the us. i'm china. what's happened? these are sort of form of learned helplessness. they said they are aware that is a problem. and, and in driving was off status was in re carletta resolves to investigate these

issues because people know there's a problem. the letter reports and the drug you reports aim to guide you out of its current malays. to understand the aim of these 2 major documents we spoke with in rico, let's the author of the letter report. he's a former italian prime minister and the current dean of my university school of politics, economics, and global affairs in madrid, spain. he says that europe has to re discover the true meaning of spirit of it's much fall into a single marcus. the idea is that we don't understand that the single markets is the tool jewel of do appear on the union, is the sheet and gen letter says the check. delores the hugely influential, the president of the europe information from 1985 to 1995, told him before he died in 2023. that the you had lost the sight of its guiding mission. the old ways told me they are forgetting the importance of this integrity

of the single market. they are also getting these importance. and she always asked us at the shop, below the institute to work of the single market. thinking that the single market these, the to center of advertising in a recent article, martin was listed what he sees is to use man problems. the roles, the most important are fragmentation over regulation. inappropriate regulation, insufficient spending, and on ju, conservatism of these fragmentation is the most damaging. this is the idea that the single marcus doesn't really exist despite the desire to create a single market to create a banking union as an integrative financial system to create an integrated capital

markets. which imply, of course, highly integrated regulatory systems across look really the counts in across the u . so the instance businesses can operate as if you were, it was what the waste can be very, very far from that he says the clearest examples of this can be seen in banking defense. if we rescue banks, they will be rescue, buys, states, member states, they wouldn't be rescued by the us team together because the u as a whole has almost no fiscal 5 out at all. so it's really, really hot in this situation to think about europe from the point of view of the economy, a molten economy as an integrated whole for an rico letter healing this fragmentation is the central message of his report. we think that we are one as the us

and as china, by the reality on many economic issues, europe is just the geographic that expedition. we are 27. and if we keep being 27, we would be, i would say the marginalized by the americans and the chinese, that is the main message. the new prides itself on for freedoms, the free movement of goods, services, capital, and people. but and recall that it says it has been missing a 5th freedom. and up now is the time to set that right? we missed the tangible, the digital routes. so the idea to launch these fees to free the visual knowledge and to have everything related to this decision is for me from them in the decision the leaders agreed as amazing in budapest, in november to work on the introduction of this intangible 5th freedom. agreeing

and principal to a single market for research, innovation, knowledge and education. a direct response to the letter and drug you reports. of the center of the drive here report is a call for your up to become more productive. but it says that to do that. it needs to become more innovative and to become more innovative. that needs to invest since the financial crisis, investment rates in the us have it stripped those in the you in terms of private investment, the was ahead of the us until 2011. but the gap is white and significantly over the past few years for government investments us and the rates of marriage one another . but the u. s. is also where amanda has the comparison matters because many your pain startups up to expand in the us rather than any business sites up in america can regard the whole united states as a market is much more difficult for european business and the lack of

a capital market union, for example, is one of the reasons that if you want to set up a style to up a tech, solve of it so much more sensible dues to get yourself funded in america. and then even move to america. the consequences are easy to see. here's the largest companies in the world by market capitalization. it's a list dominated by us for and you have to go all the way down to number 20 to find a your paying for the damage. pharmaceutical company noval nor just among the most valuable us firms are the world's leading tech firms. microsoft chip joins and video and their worth is of trillions, not billions. your biggest firms are much less valuable. the most valuable is at the same level as the us is 17th or 18th, depending on the days given rates. and your biggest firms dealing more old

fashioned consumer and health care products rather than in more innovative technological fields. the drug you report emphasizes repeatedly, but the most ramp of public and private investments. to even put an exact figure on the report states to meet the objectives laid out. and this report a minimum annual additional investment of 752800 1000000000 euros is needed. well, i think this is he waiting for a big number in the hope that they people would be so frightened by the big my number they would agree on the smaller one. i think he sold probably i haven't talked to him about that. and i have actually talked to him about the report. if you dollars for a smaller number, people say, well let's go for an even smaller number, but it's not just public money. the report outlines, but if your opinions invested more and saved less, it would go a significant way towards making up the shortfall. for leading the e. c. b numbers, there's around $300000000000.00 euros per year. is the total amount of

money coming from european savings, leaving us to go to the us, the end up being invested in dear mary, can market or buying because the american market is more united. a beat and, and what this will be. so i started by saying, why don't we work to retain this big amount of savings in new? what else do you think the possibility to where you will be, have savers to invest them? in europe, in europe, the savings tools that can give them that good to europeans, save a high share of the g d p. significantly marketing private people. how sold that in america with britain for that matter. and recall as i believe's, the private funding will help on lock public funding and the both are desperately need as the we understand very well that the beach resolves, we need,

we can get them only with public safety. if we are not able to mobilize private funding, it would be impossible. and to mobilize private funding, the only ways to create a single markets on financial services in your business. but we don't have to be. and this is why i wanted to put this point that the center of the c i o drug is report, lays out in stock detail what the needs to do in order to be able to compete with the us in china. but knowing what has to be done and actually been able to do is, are 2 very different things. political instability is probably including in the 2 main new drivers, france and germany, france as a 4 prime ministers in a year with president emmanuel and the crime looking increasingly weekend. germany will hold elections next month after the previous 3 part to go.