Whether the Maltese Presidency of the Council of the European Union has been successful or not is difficult to determine, not least because there are still two months to go until the end of the term. However, as numerous eminent figures have agreed, including Emma Marcegaglia, president of BusinessEurope, the Maltese Presidency is undoubtedly leading the EU at a crucial time for Europe.
President Marcegaglia, who’s been at the helm of BusinessEurope since 2013, states that, more than ever before, member states must show unity and cohesion and defend what has brought countries and Europeans together: the promotion of peace, of EU values, of prosperity and the well-being of its people.
“Europe is faced with many challenges: insufficient growth and employment, security threats, geopolitical instability, Brexit and rising populism. We must work together to answer companies’ and citizens’ concerns about the future more efficiently,” she asserts. “The Maltese Presidency has a vital role to play in shaping European level decisions, in finding common ground and in showing that the EU is delivering concrete results. Half way through the Presidency, it is too early to assess the accomplishments, but we see many useful steps taken to fulfil the Presidency’s comprehensive and ambitious agenda.”
"Together, European countries are stronger. They can defend their interest better and shape globalisation in accordance with our values."
The rise of populism in recent years has climbed its way to the top as a serious threat to the stability of the Union. Ms Marcegaglia says that populistic and anti-establishment feelings are present to different extents in different parts of Europe and the world, and the causes behind the current distrust in ‘the establishment’ are various – from economic causes linked to the consequences of the 2008 global economic crisis and political distrust linked to scandals, to rising divergences between countries and regions, identity fears and feelings of being left behind in a globalised world.
“For BusinessEurope, it is very clear: Europe is not the problem. It is the solution. Together, European countries are stronger. They can defend their interest better and shape globalisation in accordance with our values. And our Single Market is a powerful engine for higher growth and increased job creation,” she states. “To mitigate citizens’ anxieties about the future and limit the rise in populism, a resilient, growing economy and further decrease of unemployment are key. Companies are an essential part of the solution, but they need to be competitive in order to generate wealth and create jobs. The Maltese Presidency should make sure that all the EU proposals to be adopted during its term in office contribute to improving competitiveness, growth and employment.”
On a tangible level, how can decisions taken during the Maltese Presidency translate into opportunities for businesses and for citizens? “One of the priorities of the Maltese Presidency is to further advance the EU Single Market, develop the Digital Single Market and complete the Internal Energy Market. This is on the top of our agenda as well, as the European Single Market is one of the EU’s greatest achievements and the foundation of our prosperity,” says Ms Marcegaglia. “Much has been achieved so far, and tangible benefits from the Single Market of businesses and citizens are numerous. For example, thanks to the new roaming rules, cross-border roaming charges will be fully removed within the EU from June 2017.”
Moving on to the current state and forecasts of Europe’s economy for 2017, Ms Marcegaglia asserts that the latest economic indicators are giving reasons for cautious optimism where, in recent months, there has been a steady continuation of economic recovery in the EU with growth of 0.4 per cent at the end of 2016.
BusinessEurope’s Autumn Economic Outlook shows that European business expects the EU’s economic recovery to continue despite an increasingly challenging international environment. “For 2017, we expect growth to continue by 1.6 per cent in the EU and 1.5 per cent in the Euro Area. Despite these positive numbers, it is also clear that growth is still strongly supported by temporary factors such as the support from the European Central Bank. We have to continue our reforms to secure sustainable long-term growth in the future.”
Despite being a major global destination for Foreign Direct Investment (FDI), the EU’s share of worldwide FDI fell to 24 per cent in 2015 compared to 48 per cent in 2000. “This is a real warning signal. Despite all its strengths, the EU is still perceived as a complicated and expensive place to invest in. High taxes, energy prices, non-wage labour costs and burdensome administration are among the negative factors.”
Now that the UK has formally opened proceedings to leave the EU, it remains to be seen how Brexit will concretely affect the bloc as well as foreign business operators set up in the UK. Ms Marcegaglia explains that EU and UK economies are profoundly interconnected – “41 per cent of total UK exports go to the EU, representing 11 per cent of British GDP, whilst seven per cent of total EU exports go to the UK, representing less than four per cent of the EU’s GDP. This compares with intra-Single Market trade amounting to 27 per cent of EU GDP.”
The BusinessEurope president adds that the UK’s decision to leave the EU opens up factors of uncertainty, especially for the business community, making it essential to organise the UK’s exit from the EU in an orderly and constructive manner. “We are still in the process of assessing the impact of Brexit, but we already see some issues of concern for a number of sectors, such as customs procedures and the possibility of regulatory divergence in the future. As business, we have an interest to maintain as close economic relations as possible between the EU and the UK, while preserving the integrity of the Single Market and its four freedoms.”
This is a snippet. Read the full interview on the latest issue of the Commercial Courier.