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Europe needs 'single market czar' to implement Draghi report faster, IMF's Georgieva tells Euronews
IMF Managing Director Kristalina Georgieva calls for a single, authoritative voice to lead the implementation of the Draghi report or risk losing precious time for Europe at an 'existential moment' for the bloc.
READ MORE : http://www.euronews.com/2025/11/10/europe-needs-single-market-czar-to-implement-draghi-report-faster-imfs-georgieva-tells-eur
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IMF Managing Director Kristalina Georgieva calls for a single, authoritative voice to lead the implementation of the Draghi report or risk losing precious time for Europe at an 'existential moment' for the bloc.
READ MORE : http://www.euronews.com/2025/11/10/europe-needs-single-market-czar-to-implement-draghi-report-faster-imfs-georgieva-tells-eur
Subscribe to our channel. Euronews is available on Dailymotion in 12 languages
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00:00Welcome to the Europe Conversation. My guest today is Kristalina Georgieva,
00:12Managing Director of the IMF. Madam Georgieva, thank you very much for joining us exclusively
00:16on Euronews from a very special location because today we are in Bulgaria, your home country.
00:23So it makes it special in a way.
00:25Very special. Thank you for having me from here.
00:27I wanted to start with the man some say is now the voice of reason in Europe, and that
00:33could be Mario Draghi. He said this is now an existential moment for this continent.
00:38When you look at Europe, and now we are in Europe, is that something that you go, he's
00:42right, it's existential.
00:43He's right. In a rapidly changing world, moving slowly means falling behind. And Europe has
00:52been moving slowly on completing the single market. When we look at the European project,
01:01it is fantastic. The best invention of the 20th century was the convergence engine of Europe.
01:09But we are now seeing this engine slowing down. When we read the Draghi report, it is very clear
01:20what needs to be done. At the fund, we actually look at the priorities and we came up with four
01:26points for Europe to regain competitiveness. And they are, one, create the 28 regime for firms.
01:36Why? Because companies should be able to register in multiple countries under the same rules.
01:41Two, complete the banking union, the capital markets union. Why? Because if we don't, our savings,
01:50European savings, will be working somewhere else. Over 300 billion euros are working, not in Europe.
01:59Three, get the labor qualifications to move with people. Now, labor can move, but qualifications have to be
02:10regained time and again. And that is, of course, a problem for using our labor effectively. And four,
02:19integrate the energy system of Europe. So, of course, Mario Draghi gave a very comprehensive set of
02:27recommendations. We heard then many lofty words, oh, so important, oh, we have to do it. But we are more on the
02:37talking about doing and less on doing itself. So, speed up Europe. And of course, that's a great point
02:44because it's been a year now. And the premise of this report was either radical change in Europe
02:49or a form of slow agony. Which one is it going to be? I am an optimist about Europe because I have seen
02:57in Europe time and again when it is really tough making the right choice. Very often, it takes some time,
03:07but then the moment comes, like during Eurozone crisis, when decisive action saved Europe. And
03:15actually, the very same Mario Draghi at that time said, whatever it takes. And we are in a similar
03:21moment now. Why? Because when we look at the productivity of the United States and productivity
03:28in Europe, Europe lags behind. When we look at growth in Europe, 1.2%. So, we have all this wealth
03:36and this is all we can produce, 1.2% growth. When we look at the dynamic firms in the United States,
03:46they are firms that grow very rapidly. In Europe, we do not have that phenomenon of rapidly growing
03:54high-tech firms. Can Europe catch up? Of course. But for that, we need to make the single market
04:03our number one priority. And actually, I have been recommending to have a single market czar,
04:13somebody who is given the authority on all the aspects of the single market to call the shots.
04:19And that's a great point because the problem is, at this point, is that the European leadership is
04:25just too weak. Who can be the whatever-it-takes person? Who's the man, the woman? You know, I think...
04:31Is there anyone? So, let me say that. I have seen very strong leaders on the economic front in Europe.
04:40And I think if Europe is willing to delegate authority, Europe will have enough skills and
04:48capabilities to do it. I just want to remind you, when the UK decided to leave the European Union,
04:57at that time, what did Europe do? Well, delegated authority to negotiate on behalf of all 27 countries
05:05to Michel Barnier, to one person. And this one person had access to heads of states, had access to the resources
05:13of the Commission, led the negotiations, and the benefits were shared by all member states.
05:20So, I'm confident that if there is a will, there would be a way. Right now, when you look at all these things
05:28I'm talking about, they are in the hands of different council formations.
05:34Too many cooks. And different commissioners running. I used to be a commissioner.
05:38I know that unless you're given full authority, it's very hard to break through.
05:43So, Europe has to say, we want the best for our future. And you cannot get it without completing
05:55the single market. Just not possible.
05:57And this is a fascinating idea what you've mentioned. So, are you suggesting, just so that I can understand
06:02correctly what you're saying, does it mean that in order to implement this report, you need a single
06:06person with the gravitas and the authority to carry it out throughout and have the responsibility?
06:10And I'm sure you have thoughts of who you would like that person to be.
06:14I would let this to the European leadership to decide. I think the issue is agreeing that there has
06:24to be a delegation of authority. And this delegation of authority has to be across the main areas of
06:30completing the single market. Right now, different... It's too complex.
06:35It's so complex and it's just not moving fast enough. I know it is moving. I want to say to the Europeans
06:43who are working on it, bravo, keep doing it. Not moving fast enough.
06:49One of the big stories this year is, well, the tariffs regime. And when it comes to Europe,
06:53they triple tariffs on the European units, a 15% rate. When you look at that, have you assessed
06:59the impact? And some say that could signal the start of the century of humiliation for Europe.
07:05Is that too much? Are we reading too much into that 15%?
07:08I think Europe is going to cut through that. So let's see what happened. There was an announcement
07:14of tariffs. Trade uncertainty shot through the roof. And there was panic that the world is going to
07:22slip into recession. By the way, the IMF did not subscribe to the recession option. In reality,
07:32one, the world has proven to be more resilient. And you look at Europe, what are the sources of this
07:39resilience? Strong institutions, good policies, responsible governance, and private sector that adapts
07:48to changes faster than the public sector does. But also, when the tariffs hit, what was announced in
07:59April, 23% tariffs across the globe on average. And what we have today, it is around 17%. When you check
08:11how much is actually collected, with all the exceptions and this and that, between 9% and 10%. In other words,
08:18the hit is not as strong. Most importantly, and I love Europe for that,
08:24the majority of countries decided not to retaliate. No tit for tat. I know that some of the European
08:33people are saying, oh, we should have gone. Europe was weak. It was weak. But what happens if you hit
08:39back and then everybody starts hitting? We get on this down spiral. In fact, today, because of that
08:48behaviour saying, look, you, the United States, you decided to go this way, we don't subscribe. You present,
08:58say, 14% of trade. The rest, 86%, 87%. We choose to trade by the rules we have established. And that is
09:12what saved the world economy. The fact that there is no slippage into everybody hitting everybody else.
09:22It's not over. In other words, that may change. And I would really urge countries, please don't go for
09:31a trade war. Don't do it. So you say Europe made the responsible choice by taking on this 15%, which may be
09:37less effectively and when it's implemented. But some believe the damage and the cost was political.
09:42And that's why the EU should have retaliated. It should have showed strength. It's the biggest
09:48training block in the world. Well, I think Europe can show strength
09:51by working actively with those who want to trade on the basis of rules. And I would encourage Europe to
10:01show leadership in that regard. Because when you look at the world today, multipolar, you see regions that
10:11are now building stronger intra-region trade like ASEAN or the Gulf countries. Europe has already started
10:20reaching out more actively to build agreements with different, let's call them new blocks. And that is
10:29where Europe should bring its soft power in action. Move the world away from a trade war.
10:38So you would like to see the Mercosur approved? Would you like to see a European WTO? That idea was floated?
10:42Totally. I want to see the Europeans saying, well, trade war, thank you. But no, thank you. We are going to
10:51work with the rest of the world. Now, I'm actually optimist about where we are going to land. Because if you
10:58look at the history of humanity, it's a history of trade. Trade is like water. You put an obstacle,
11:05it goes around it. But it can go around it with more efficiency or less efficiency. Europe has to make
11:15the new world the multipolar world of multiple interests to work more efficiently. And actually,
11:22there is an appetite around the world. I hear it from our members for Europe to take this leadership
11:29role. Can that happen? And of course, we're in Bulgaria today. Ukraine is very close. And you
11:36can really see it also in the side, guys. Can you do all of that? Well, also, there's a war going on
11:40on the continent. I wonder, just from your experience, of course, you were, if I remember correctly, if I've
11:45done the maths correctly, you were just 35 when the Iron Curtain fell. At that time, it seemed this
11:50is a new world of possibilities. And now there's a war in continental Europe. Do you sometimes go,
11:54how do we end up here? I'll tell you, I never thought I would see a military power in Europe invading
12:01another country. But it happened. What we see in the world today is more unpredictability,
12:09the unthinkable taking place. And we have to recognize this is the world we live in, and we will
12:17be living in. What does it mean? It means two things. Actually, it demands more cooperation, not less.
12:25When you have uncertainty, to see a path, you have to work more with others, with like-minded.
12:33And second, it means more agility and adaptability. For Europe, this means also looking at the decision
12:41making process in Europe. Is it good? Is it adaptable enough for a fast changing world? And
12:49going back to my experience after the end of the Cold War, there was a period of euphoria when we
12:57embraced freedom and it was fantastic. And then hard reality hit. It is difficult
13:06to transform an economy. Now we have a world that is being hit by multiple forces of transformation,
13:13geopolitical, trade, technology, demography, climate. Just imagine how much
13:22more difficult it is to adapt and transform in this world. And actually, I believe that new member states,
13:30they should raise their voice even more on the importance of agility and adaptability
13:38in a transforming world. Because they know, they know from experience what it is.
13:43And you mentioned all of the issues, which are many. Obviously, now there's a war, there's a question
13:48of demographics, there's a question of climate. Now there's a question of rearming. Obviously,
13:52everyone has agreed to pay this 5% in NATO. But what I don't see, I see the many challenges,
13:56but I don't see the fiscal space. And I don't see political consensus around a budget. How do you go
14:01around this? How do you, what do you do when you don't have fiscal space? You create it. How do you create
14:08it? One, make Europe more competitive, make it more productive, raise the growth level to a point
14:15when we actually can create more space to reform. I mean, how is it that reforms we all know have
14:26to take place, like pension reform, are so tough to to do? I think we have to just put it on hold.
14:33There's a lot of fatigue. We have to engage people and just make be honest with people saying, look,
14:38you, and more importantly, your children, your grandchildren, if you want them to live with
14:46the standard of living that is at par with your aspirations, Europe has to be more productive.
14:55Europeans who live longer have to work longer. When I was, you talk about the pre-Cold War,
15:03end of Cold War time. I was a professor in Bulgaria in these days. I was confident that I will retire
15:11as a professor at 55. Look at me now. I'm not going to disclose. Well, it's easy to find, but I
15:19sure am not 55 and I'm still working and I'm happy to be productive. So we have to get this taboo in
15:28Europe around topics that are actually impediments to building the fiscal space you're talking about.
15:35And you mentioned the taboos in Europe. One of them obviously has to do with debt. There's a big
15:39debate. There's good debt. There's bad debt. I worry or I wonder if you worry about the trajectory that
15:43we see of debt to GDP in Europe, or do you go join debt in some areas can actually be good? So two
15:50things. One, the trajectory in different countries is different. We're here in Bulgaria, debt to GDP
15:57is 24%. But even here, we are concerned that there may be a bit too much appetite to borrow. So
16:05countries where debt is very high, they really have to have medium term strategy to bring it down,
16:11because otherwise it is suffocating the ability to invest in education, in artificial intelligence,
16:18in productive directions. Two, I very strongly believe that Europe should use its capacity to borrow
16:26together and deploy the resources. You're in favor of join debt for critical areas.
16:31I'm, if you want to invest in the most effective manner, you have to pull resources and deploy resources
16:40in that manner. I, I know this is such a hard topic, but you say, many have said it, why is it not moving?
16:49You're a commissioner, you know the machine. What's the issue? Well, the, the issue is that,
16:56of course, we have 27 countries, different priorities, different decision-making processes,
17:04and it is a richness to have that diversity, but our decision-making processes are not quite fit
17:14for the speed of change of today's world. And what does your political instinct say? Is this
17:20going to happen ultimately? I, it happened in the pandemic. I believe, I believe that we will
17:26wrestle and then we will come on the right side of history, as we have done many times. I'm a big
17:31believer in Europe. I think the European project is an excitement. And I think we have to bring that
17:40excitement back and then be honest with European people. You want to live well? Guess what? We have
17:49to work together. We have to deploy our resources more effectively together, and we have to be more
17:56productive. There is just no way around it. We cannot continue to spend money we don't have.
18:03And I have a final question. Of course, I have to ask this question because today we are recording this
18:08in Bulgaria. Obviously, you felt very strong, and this is something that you dedicated a lot of
18:13amount of personal energy, but also time to getting this country into the Euro. It's happened
18:19now this year. But I have to be honest, I've detected a form of anxiety, even from the airport to the
18:24studio, about the Euro, about prices, about inflation, about what is this going to do to our countries?
18:30Is it really going to make it better? What do you say to this? Because you can really feel this,
18:35sense of anxiety about the changes in the pricing. What I can say to my beloved fellow Bulgarians is
18:44we have been in the Eurozone now for many years because Bulgaria has a currency board. We have
18:53submitted our sovereignty on monetary policy first to the Bundesbank and then to the European Central
19:01Bank. We were in but with no right to vote. Now we are in and we have the right to vote and to benefit
19:11from the cushion that the Eurozone provides to us. But the Euro is a prerequisite for a more dynamic economy,
19:24not a guarantee for increased standard of living. We have to continue on the path to reforms,
19:32to be strong economically on the basis of
19:37good fiscal policy, good debt management policy, and above all, focus on productivity of our people.
19:47Well, Madame Georgieva, thank you very much and thank you for joining us on the Europe Conversation here
19:52on Euro News. Always good to see you. Thank you.
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