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Can common debt fix Europe’s growth problem? MEPs debate in The Ring
In this week’s episode of The Ring, EU lawmakers Markus Ferber and Pasquale Tridico clash over whether common debt is the answer to Europe's stagnant economy and weakened competitiveness.
READ MORE : http://www.euronews.com/2026/07/15/can-common-debt-fix-europes-growth-problem-meps-debate-in-the-ring
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In this week’s episode of The Ring, EU lawmakers Markus Ferber and Pasquale Tridico clash over whether common debt is the answer to Europe's stagnant economy and weakened competitiveness.
READ MORE : http://www.euronews.com/2026/07/15/can-common-debt-fix-europes-growth-problem-meps-debate-in-the-ring
Subscribe to our channel. Euronews is available on Dailymotion in 12 languages
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NewsTranscript
00:07Hello and welcome to The Ring, Euronews' weekly debating show.
00:13This week, broadcast from the European Parliament here in Brussels.
00:17I'm your host, Marek Gwynne.
00:19Now, every week, two members of the European Parliament step into the ring
00:23to debate some of the most pressing issues facing the European Union.
00:27This week, we're discussing the economic downturn looming over European nations.
00:33A deep ideological divide is now emerging between countries who want more joint borrowing to fund growth
00:40and frugal states who want fiscal discipline.
00:44Luis Albertos explains.
00:47Is Europe's economy at breaking point?
00:51High borrowing costs, limited fiscal space and weakening competitiveness
00:55are all putting Europe's economic stability at risk.
00:59Countries previously considered economic powerhouses such as France and Germany
01:03are now struggling with sluggish growth due to low productivity and industrial decline.
01:10The diagnosis is clear, but the solution is not.
01:13EU capitals are torn on the way forward.
01:16Last week, Spain proposed expanding the EU's use of common debt
01:20to help finance strategic investments.
01:23Under the proposal, the European Commission would borrow on behalf of EU member states
01:27to fund shared priorities, such as defense, energy, innovation and infrastructure.
01:33Supporters, namely southern European member states,
01:35argue that it would strengthen Europe's competitiveness and lower financing costs.
01:41But several northern member states oppose expanding common debt,
01:44arguing the EU should prioritize stricter spending rules and fiscal discipline.
01:49Can EU countries find common ground?
01:52And what would be the economic cost for Europe if they don't?
01:59That's the topic for our debate today.
02:02Let's now meet our contenders.
02:06Pascuale Tridico, an Italian MEP from the left from Movimento Cinque Stelle.
02:11An economist and former president of Italy's National Institute for Social Security,
02:15he serves in the European Parliament's Committee on Economic and Monetary Affairs
02:19and chairs the Subcommittee on Tax Matters.
02:21A strong advocate of greater public investment at EU level, he says,
02:25Competitiveness does not come from deregulation, but from innovation embedded in investment.
02:31Common debt, not for the rearm, but for our companies and our citizens.
02:36Markus Ferber, a German MEP from the Central Right European People's Party.
02:41A long-serving member of the European Parliament, he is the vice-chair of the Subcommittee on Tax
02:45Matters and a member of the Committee on Economic and Monetary Affairs.
02:48A consistent advocate of fiscal discipline and competitiveness, he says,
02:53We tried a one-off debt instrument during the pandemic and are still arguing about who repays it.
02:59Now Spain wants to make that the permanent model.
03:02It is a supremely bad idea.
03:06So let's welcome both of them, Markus Ferber and Pascuale Tridico.
03:11Great to have you with us on The Ring.
03:13Now, the idea here is to have an open debate, a healthy one, a frank one.
03:18And to give our viewers at home a taste of the debates that happen here in the European Parliament.
03:24So let's get started.
03:26Markus Ferber, let me come to you first.
03:28Spain putting now on the table a proposal, a bold one,
03:32850 billion euros more in joint EU borrowing every year to fund growth.
03:38Is this a good idea?
03:40It is a good idea if it comes from the real economy.
03:43And that is what we have firstly to discuss.
03:45How can you organize growth?
03:47And I don't think you can organize growth by putting public money in the economy and wait for growth.
03:53And therefore, all these attempts to spend money from public budgets and then hoping growth will come never worked.
04:01At the end, you had high debt and no sustainable growth.
04:03Therefore, it's not the right instrument.
04:05Yes, Europe is competing with global giants, China, the U.S.
04:10Is it inevitable now that it needs to pull sovereignty and that only as a strong bloc it can compete
04:16with these giants, Pasquale?
04:17Yes, the point is not to do something extraordinary that countries do not do.
04:22It's to complete what we should do.
04:24In fact, Europe, the Eurozone in particular, is an imperfect union exactly because it does not use one of the
04:31most important tool for economic growth that in the history has been used.
04:36Meaning the public debt, in particular, when times require that in Christ time during, in fact, the COVID, it was
04:46used for a short time for a temporary tool.
04:49And this was the crisis which was better managed than ever in Europe.
04:53Actually, we have introduced the first Shure and then the next generation new, which were very useful temporary for Europe
05:02to grow.
05:03If we don't understand that Europe is lacking one important tool that all countries, they have in Japan, in UK,
05:10in USA, they have.
05:12It's not something that is new in the economy.
05:15So, Pasquale is saying that there is a precedent, so the safe instruments, the 150 billion euros, also the joint
05:21loan for Ukraine recently.
05:23Why not explore these avenues when it comes to the other crisis facing Europe, which is the competitiveness crisis?
05:30I think we have to separate various things.
05:32Ukraine is Ukraine and should be dealt separately and we should not mix things.
05:36The Shure program are loans for the member states.
05:38Of course, for some member states, it's interesting to get loans from the European Union as they have to pay
05:44less public loans, but they have to pay less interest rates.
05:48Sorry, that's the issue, because they don't have AAA.
05:51But if you look, for example, the member state, I know best, we are not interested in that as we
05:56have AAA by ourselves.
05:57And even the interest rates are lower for Germany than for the European Union.
06:01So, it's an instrument for those who suffer already, but to make them alive does not mean to give more
06:09debts to them.
06:10We should really think how we can strengthen the economies.
06:13Look to Greece, which is performing best because they did reforms.
06:16Look to Italy, they are performing worse because they never did reforms.
06:20Look to Spain, they misused the money of next generation EU, not for investments, but for social welfare.
06:27Sorry, if that is the way it is dealt in Europe, it's not a good idea.
06:32So, that's the debate around the Spanish pensions.
06:34And there is a debate now around whether the EU can repay the COVID recovery and resilience loans.
06:42Some leaders calling for the repayment to be delayed.
06:44So, if it's so difficult for the EU to repay its current debt, wouldn't it be irresponsible to borrow more
06:50right now?
06:50No, because Europe does not have any debt.
06:53Again, I insist.
06:55We need to complete the union.
06:57It's not something that we are adding.
06:59And this is not only, as it was mentioned by Ferber, a matter of north against south.
07:05It's a matter of union.
07:06And it's not what I said, my friend.
07:08I just underline the point.
07:10We are in the Eurozone, in the European Union, and we do have a common tariff.
07:17We do have export and import.
07:19All countries benefit from the fact, for instance, the north, Germany, benefit from the fact that it can export towards
07:25the south.
07:25So, now, an asymmetrical crisis in the south is caused as well because Germany export more towards the south.
07:33So, if you don't build the safeguard, the union itself can be destroyed and Germany cannot even export any longer.
07:41The point is that we do have a monetary union without the tool that usually country, economy, robust economy, they
07:49have to complete the union.
07:51Now, when we introduce it, look at how we manage the financial crisis.
07:56The financial crisis created poverty, unemployment, destruction of firms in Germany as well as in Italy, in the north and
08:04in the south.
08:04We didn't do the right things.
08:06Only, partially, at the end of the crisis, in 2012, when Draghi did whatever it takes and didn't even do
08:15monetary policy expansion,
08:17just say that it should do, the market was, in a way, calm.
08:22Now, we don't have the tool, and I have to say that the first time, Marcus, that this policy, the
08:27common debt, was proposed in Europe
08:30was actually by a center-right government, Berlusconi, by Tremonti, the first ever minister of economy which proposed what Spain
08:39today is proposing,
08:40was 15 years ago by a center-right economist.
08:44Your reaction to that, Max Weber, quite a lot.
08:46I think it's not a question of party affiliation, it's a question how to deal with those we want to
08:52borrow the money from.
08:53And the financial crisis started not because something went wrong in the government,
08:59because those who borrow the countries, in this case Greece, said,
09:02we do not borrow any cent anymore to your country because we don't trust that you are able to repay.
09:08And what is the signal we are sending out with next-generation EU if we discuss with the council who
09:14promised new own resources for repayment?
09:17Nothing has happened since then.
09:18So the market will not trust us.
09:21And then I wish you all the best and good luck to go to the market asking for money,
09:26but refinancing, repayment, who cares?
09:29Sorry, the market will ask for high interest rates for that, and then it's not a qualified instrument.
09:34You have to do some things, a lot of things before, and then maybe one can sink.
09:40But at the moment, as we are constructed, it makes no sense.
09:44So you disagree with the Spanish economy minister who says that in fact by borrowing a lot of money,
09:51850 billion, actually the interest rates will be very favorable.
09:54He speaks about 5 billion euros per year in interest.
09:58Yeah, but the idea of the Spanish is that those who want to join in are borrowing money,
10:04but the others have to stand for the debts, and that is not functioning.
10:08Those who borrow the money have to stay for the debts,
10:10but if it is only those who cannot afford the interest rates anymore, they will not have lower interest rates.
10:16So I think that is a calculation which fits on the paper, but not on the markets.
10:21Finally, there's clearly a divide here. We're seeing it very clearly.
10:24Does that mean that the European Union might need to move differently,
10:29and a group of countries that do favor this might need to do it alone, without the backing of the
10:3427?
10:35Well, you need to consider that we do have a eurozone.
10:38Within the eurozone, this is something that needs to be done.
10:41You can have a different approach outside of the eurozone, but within the eurozone, this is a common policy.
10:48Again, just because it's missing, not because we want to add something more.
10:51Let me specify one thing. Everybody probably thinks that Italy, for instance,
10:56is a country which spends more than what it gets.
10:59Actually, it is the opposite. As all the economists know,
11:02the primary surplus of Italy has been in primary surplus for the past 25 years.
11:07As German, Italy is a country which has more expo than import,
11:11has always had a primary surplus.
11:15It pays a higher cost of debt, which actually is detrimental for the economy,
11:22because we are paying more interest than other.
11:24And in a eurozone, this is actually dysfunctional.
11:28It's not me that you say that.
11:30Nobel economists like Mandel, 1992, say that the first thing that Europe need to do
11:34is to create a safe asset.
11:37It works well during the crisis, and then you can cope with the calm market in a better way.
11:44Look what's happening today in German, but that's what in Italy.
11:47With the industrial crisis, with the automotive sector,
11:50which is leaving thousands of people without jobs.
11:54How can we cope with that without a plan like we proposed,
11:59the sure plan for automotive, supporting the supply, supporting the demand,
12:04and supporting as well the investment in the electric transition.
12:09Chinese, with a soft budget constraint, are doing that and are much more competitive.
12:15And I'm sure we will come back to that and the China issue.
12:18But I must stop you there because that's the end of our first round.
12:22The debate is heating up, I see.
12:24We will continue it.
12:26But it is time for us to move on.
12:28And in the next round, we take the gloves off.
12:35In this round, we give you both the opportunity to directly challenge each other.
12:41I know you've come with your own questions.
12:43So now first, Marcus Ferber, your first question to Pascuale Trinico.
12:48Yeah, Pascuale, the Spanish paper says that the European Union budget has to guarantee
12:53the bonds which are issued, which means we have to increase the guarantees the member
12:59states are granting to the European Union.
13:01Do you really think it is appropriate then to spend it for debts in other member states
13:06and not to spend it directly in the budget?
13:08I don't understand this mechanism.
13:10Marcus, you don't understand because you don't see the Union as a union.
13:14Probably.
13:15If you see the Union staying as part of the Union, then a solidarity mechanism in the Eurozone,
13:21not because we want to be good, but because we want an economy which works, we need to accept
13:27a common debt.
13:28It is not a matter only of solidarity.
13:31It is a matter of a well-built framework and economy.
13:35Again, this is not what we are saying for political preferences.
13:39This is what we say after several economists.
13:43I quoted before Mandel and I quoted Stiglitz.
13:47Actually, they say that the Euro is in crisis exactly because it does not have a safe asset
13:51which works during the Christ time.
13:53And we saw that it works because safe assets like during Covid, sure, Next Generation Euro,
13:59were exactly done because we miss one structural tool like that and we introduce temporary.
14:05Now, the proposal is to introduce not temporary but structural in order to act when crisis comes.
14:13Even if you don't have to act, probably the market will be more calm if there is the presence of
14:19a safe asset.
14:20Okay.
14:20And Pasquale Trivico, your first question now to Marcos Febber.
14:24Marcos, we are speaking all the time about resources.
14:27Your question as well was about the resources and now about how to repay.
14:30Now we know that most of the firms which are doing well and better in the economy are the digital
14:39firms,
14:39firms which are producing, multinational in particular, which are producing digital services in Europe
14:45and we are not taxing them.
14:47We have proposed a web tax in order to collect some common resources, again, to shape our economy as well
14:56during Christ time
14:57and for a matter of equilibrium.
14:59Would you agree with a web tax?
15:01The problem is a little bit more difficult as we have some member states in the European Union
15:05who have already introduced a so-called digital tax, yeah?
15:09And if I ask the finance ministers of these member states, they say, yes, we are in favor of a
15:15digital tax,
15:16even European harmonized and how to calculate it, but I want the money.
15:20And now that is not a helpful tool to address the issue we are discussing today
15:26because if you want to have that tax as a guarantee for common debts,
15:32then these member states who have already introduced digital tax have to transfer the amounts they are receiving out of
15:40that to the European Union.
15:42And that's why in the council no one took it up.
15:45So good luck with an idea where there is no support in the council.
15:48But if I may, for the own resources, there is a debate about gambling sites, for example.
15:53What makes digital corporations different?
15:56Yeah, as I said, we have more than a handful of member states who have already a digital tax for
16:01national budgets
16:02and therefore they are not willing to give it up.
16:05To invent new taxes is always a beloved thing by those who are not able to do reforms.
16:09But honestly, if you want to have sustainable growth, you don't have to have higher taxes,
16:14you don't have to have more taxes, you really need incentives for the member states.
16:19And I'm really surprised that those who overrun the European Union with bureaucratic burdens in the last 10 years,
16:25and sorry, you belong to this part of the parliament, are now complaining that we don't create growth anymore.
16:30We have to free our economy.
16:33That's more important than to throw money to them.
16:35OK, we'll come back to that.
16:37I know you had more questions, but that's all we have time for this second round,
16:42because now it's time to bring in a new voice.
16:49I'd like to now bring in the president of the European Central Bank, Christine Lagarde.
16:53She sat down for an interview with Euronews last week
16:57and was asked for her reaction to Spain's proposal for more joint debt in the EU.
17:04Let's take a listen to what she had to say.
17:06The circumstances have changed and it should lead the leaders of the various member states to consider
17:13and to address what are their concerns.
17:16So I think an ex ante no over my dead body is not the best way to deal with it.
17:22I think the best way to deal with it is to try to analyze what is too much of a
17:27risk
17:27and how that risk can be addressed.
17:29So, Marcus Feber, a veiled criticism there of those like you, I believe, who say no outright.
17:36Should we at least debate this more seriously in the EU?
17:40Yeah, but the question is what is the starting point of the discussion?
17:43Is the starting point of the discussion common depth or is it common policies?
17:48Because I read the Spanish proposal that national obligations should be financed by European debts
17:54and that will not work.
17:56So we have to take it the other way around.
17:58What can we do together as Europeans?
18:02And that's why I really don't want to be accused not being a federalist in the positive sense
18:10because I am, but firstly we have to define what we can do together
18:15and then we have to speak about the financing and not the other way around.
18:19Let's find finances and finance national obligations.
18:22I want to ask you because Italy is one of the EU countries facing major elections next year
18:28along with France, Spain, Greece and others.
18:31Do you fear that we could see a shift back to this kind of narrative
18:36that economic matters is a national thing, it's all about national sovereignty
18:40and that could really undermine this push to pull more sovereignty at the EU level?
18:46Look, while we think that economy is a national matter,
18:50we are overhelmed outside by multinational which are not national.
18:54So sovereignty of national economy is very much constrained by global and in particular by multinational.
19:00That's why I said before that if we need to define policy,
19:05tax policy should be defined as well in the digital sector.
19:09I'm not saying that resources should not be left to the member states,
19:15should be coordinated at member states, even the harmonization.
19:18We often do a dumping among member states in terms of tax to attract capital from one country to another.
19:26Usually northern countries try to attract capital with fiscal dumping, with tax dumping.
19:32That's why we need a policy, policy in terms of digital services,
19:35policy in terms of capital taxes, corporate taxes, harmonization.
19:39This is the way to support a federalist idea of Europe.
19:44Okay, thank you both, but it's now time for us to take a break here on The Ring,
19:49but we'll be back with more after this, so stay with us.
20:00Welcome back to The Ring, Euronews' weekly debate show.
20:04I'm Maret Gwynn and I'm joined this week by Marcus Ferber from the European People's Party
20:09and Pasquale Tridico from the left group.
20:12Today, our topic is the state of Europe's economy and the mounting calls on the EU
20:18to raise more joint debt to fund growth.
20:21Behind these calls, of course, is the realization that European growth is stagnating
20:27and that Europe is failing to keep up with major global competitors.
20:32Let's take a closer look at the data.
20:34And we can see here that in terms of real GDP, that's inflation-adjusted gross domestic product,
20:41it's growing at a much higher rate globally than in the EU,
20:45but it's also higher in other advanced economies such as Japan and the US.
20:49We also see stagnation in real GDP in the EU in recent years.
20:54And we know, of course, that in the first quarter of 2026,
20:58the eurozone economy, in fact, shrank by 0.2%.
21:03Now, this is concerning for Europeans.
21:05And part of the problem is this question of global competitiveness.
21:09We know that China, some would say, is increasingly predatory in its tactics when it comes to trade.
21:15Is the EU doing enough to get tougher on China?
21:19No, we are not doing enough because we are not using the only asset we have, which is the single
21:24market.
21:25And if you look to the figures calculated by the International Monetary Fund,
21:29which says that even in the trade of goods, we hurt ourselves like tariffs of 45%,
21:35which is three times what the US is doing with us,
21:38that shows there's a high potential in the single market.
21:41And we really should use these possibilities to strengthen our home market,
21:46to be less dependent from exports to other regions in the world.
21:50And the other thing means as well to protect ourselves,
21:53especially against China, who is subsidizing its overproduction.
21:57And that is not an entrance key for European Union markets,
22:00and we should protect ourselves.
22:02We know all of these arguments.
22:03We hear them all the time here in Brussels these days.
22:06The Commission now saying that by October there will be a trade deal,
22:09or it does get tougher.
22:10Do you believe that that will happen?
22:12Well, I hope so, because I hope that Europe will be more competitive.
22:16However, I have to say competitiveness does not come out of the blue.
22:20Competitiveness, of course, comes from investment, from capital, from market.
22:24But there is a big role here that can be played.
22:26In particular, during the face of country,
22:30which uses several weapons, meaning political weapons, economic weapons,
22:34such as soft budget, one of the most important tools,
22:38which we are missing is the public investment here.
22:40In particular, during transition as the one that we are leaving.
22:44We are leaving an ecological transition, an environmental transition.
22:47We are doing nothing to be more competitive.
22:49Exactly in the same field of China, which is the electric transition.
22:54Our automotive sector, for instance, is losing step, is losing competitiveness.
22:58Exactly because we miss a big player.
23:01Look at the case of Boeing.
23:03They won, sorry, to compete against Boeing in the United States.
23:08We had a consortium, one single player, like the Airbus, which was more competitive.
23:14And here we had an industrial policy, a European industrial policy in that sector,
23:19in the Airbus sector.
23:21We can have an industrial policy with a plan of at least 500 billion euros,
23:27which supported the transition in three ways.
23:30First, supporting demand.
23:31We know that electric cars are higher than RLS,
23:35so we can, for instance, introduce a cut in the VAT for consumption of electric cars.
23:41Second, supply.
23:44Investors are basically afraid, don't know what they do.
23:47There is uncertainty.
23:48We need to say that the electric transition is a must,
23:51but we need to support that, meaning that we need to have credits for tax credits for firms investing huge
23:59tax credits,
23:59like the United States did investing in electric cars.
24:04And third, and last, is to support as well employers, meaning workers, sorry.
24:10Workers are suffering during this transition because they are getting in a full-off scheme,
24:17in suspension of work, in unemployment.
24:20There is a need there to support income because without income there is no demand.
24:24Some interesting ideas there.
24:26Industrial decline is clearly a big concern in Germany.
24:29Do you agree with some of those ideas?
24:30I think our main objectives, our main problems are high energy prices.
24:36The energy market, a real integrated, full integrated energy market could help a lot.
24:40Number two is aging society.
24:43That is a huge challenge for us.
24:45So we have really to invest more in education in our own people.
24:51That is very important.
24:52And number three is, as I said, strengthening the single market.
24:56That are the key objectives to achieve, not finance here, finance here, finance here.
25:01That is not addressing any problem.
25:03Okay.
25:04So a few areas of common ground, perhaps, but also a lot of disagreement here, I see.
25:10But let me stop you there because now it's time for us to move on to our fifth and final
25:15round.
25:19In our last round, we do something a little different.
25:23I'm going to ask you a series of questions and I'm going to ask you to respond with one answer,
25:29either yes or no.
25:31Are you ready?
25:33So first question to you, Pasquale Trídico.
25:35Should the EU embrace joint debt?
25:38Yes, sure.
25:39No.
25:40Marcus, should the EU at least debate Spain's proposal for more joint debt?
25:45No.
25:46Yes, sure.
25:48Should Germany and other frugal states accept higher debt if it boosts European competitiveness?
25:54It will not boost, so no.
25:56Yes, sure.
25:58Should highly indebted countries with high rates of debt and deficit cut spending before they ask for more support from
26:06the EU?
26:06No, of course.
26:08Should Europe prioritize competitiveness over balanced budgets?
26:12No, both goes hand in hand.
26:14Okay.
26:15But they go together.
26:16Oh, we agree.
26:18And finally, I'd like to ask you both, is there anything you've heard from your opponents today that has maybe
26:23made you change your mind or change your perspective on this debate?
26:29Well, we have spoken about a very specific issue on which actually there is a clear division.
26:36I understand the logic of Marcus, but this does not work in a union like us, which is actually imperfect.
26:48Okay.
26:48So we are not adding a tool.
26:50We are completing the union.
26:51And what about you, Marcus Feber?
26:53Anything that Pascuale Tridico has said has maybe changed your mind?
26:57No, because he is speaking about the last step and forget all those steps before.
27:01And I spoke about the first steps to be done.
27:03And then we are on the right track.
27:05Okay, so we haven't cracked the problem of the division over the EU's common debt on The Ring this week,
27:11but we've suddenly had a good debate on it.
27:14Thank you both.
27:15And that brings us to the end of this edition of The Ring.
27:19Thank you again, Pascuale Tridico and Marcus Feber.
27:23Thank you also to you at home for watching.
27:26And remember, you can continue the debate by sending us your thoughts, feedback and comments.
27:32Our email address is thering at euronews.com.
27:35And we'll be back soon with more from The Ring.
27:38In the meantime, take care and stay with us here on Euronews.
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