Remarks by Commissioner Dombrovskis on security, competitiveness and the digital euro at the Eurofi Financial Forum

Good afternoon, ladies and gentlemen.

Thank you for the invitation to join you today.

Eurofi remains a crucial forum for exchanges and discussions on the financial and economic developments that are shaping Europe and the world today.

And we have much to discuss in todays fast-changing and challenging climate.

For we meet today in a changing world being shaped by alliances led by might, revolutionary technological changes and transactional diplomacy.

Europe must quickly find its place in this new world to protect its citizens and secure its prosperity.

Today, I would like to focus my remarks on four policy fields in which the European Commission is taking action to achieve this objective and build a stronger, safer and more competitive Europe.

Firstly, meeting our security challenges by rebuilding our defensive capabilities.

Secondly, securing our prosperity by enhancing our competitiveness.

Thirdly, as a central pillar of this competitiveness drive, simplifying our rules and regulations to facilitate investment, growth and innovation.

And finally, strengthening our common currency and enhancing our strategic autonomy through the digital euro project.

I am pleased and grateful that, in each of these four areas, the European Commission is closely aligned with the priorities of the Danish Presidency.

Firstly, on security.

We all know our economic performance and security are mutually reinforcing, with each sustaining the other in a cyclical relationship.

You simply cannot have one without the other.

Recent developments have only underscored this.

Russias war of aggression against Ukraine is also a direct and deliberate attack on Europe, on our shared values, and on our way of life.

Three and a half years on from the beginning of Russias full-scale invasion, Ukrainians continue to hold the front line against this brutal Russian aggression, demonstrating remarkable courage and resilience to the entire world.

Ukraine must be defended.

The EU must continue to provide all possible political, economic, and military support to Ukraine.

This includes ensuring that its financing needs are covered in 2026 and maximising financial pressures on the Kremlins war machine.

Denmark is leading by example in its support for Ukraine.

By providing over €9 billion in military support, Europe, Ukraine and the world will remember that Denmark stood on the right side of history during one of modern Europes darkest hours.

Of course, Russias expansionist ambitions extend beyond Ukraine.

The extraordinary escalation in Russian attempts to test, probe and provoke by violating European airspace, is a timely wake-up call for anyone still in doubt.

We must acknowledge this fact and prepare accordingly by rebuilding Europes defence capabilities and developing our defence industry.

This will require massive and sustained investment, including private investment, and strong cooperation with our allies.

The EU is now taking bold and necessary steps to facilitate the investment needed to strengthen our defence capacities.

The European Commissions ReArm Europe Plan/Readiness 2030 initiative will help mobilisation of an unprecedent volume of resources: up to €800 billion of additional defence spending over the next four years.

The €150 billion SAFE instrument, an important pillar of this plan, has already been fully subscribed, with 19 Member States having requested support.

This transformative financing will fund investments in key areas such as missile defence, drones, and cyber security.

We will also invest to support Member States along our eastern borders with the Eastern Flank Watch – boosting our real-time surveillance so that no movement of forces goes unseen and building a drone wall.

All Member States must take part in these efforts.

We simply must invest more to maximise economies of scale and the impact of additional defence investments.

Because together, we are more than the sum of our parts.

Beyond the direct positive spillovers of higher defence spending into the wider EU economy, investing in our security is the single most essential action we can take to deter aggression, protect our way of life, and secure our long-term prosperity.

In todays more hostile world, our long-term economic prosperity is increasingly linked with our capacity to project strength and defend ourselves.

This brings me to our competitiveness agenda.

That we need to improve competitiveness is nothing new.

Europe benefits from many strong economic assets – including the Single Market, the rule of law, strong institutions and a highly educated workforce – which have helped us to navigate a series of economic shocks and crises in recent years.

However, we have been lagging behind our international competitors for example in productivity growth and innovation for over two decades.

There is now a broad consensus that we have reached a moment of reckoning where, given global developments, we must take action to make the most of our advantages and maximise innovation, productivity, and growth.

The European Commission has already made good progress with its “Competitiveness Compass” across the three pillars identified in the Draghi Report, namely closing the innovation gap, making decarbonisation a growth driver, and reducing dependencies on the outside world.

We are taking action to turn the reports recommendations into reality.

To drive innovation, for example we have launched InvestAI, an initiative to mobilise €200 billion for investment in AI, including a new European fund of €20 billion for AI gigafactories.

We have proposed a new Competitiveness Fund as an important new element of the next long-term European budget which will double the funds available for research in strategic technologies.

To diversify our trade, we have – in the last year alone – reached new trade deals with Mercosur, Mexico and Switzerland, while advancing negotiations with India, Thailand, the United Arab Emirates, among others.

To reduce our dependencies on the outside world, the European Union has selected 47 strategic projects across Europe for support under its Critical Raw Materials Act, including projects on copper and cobalt mining in Finland, lithium processing in Portugal, and battery recycling in Italy.

All of this – and more – is already underway.

Yet we also need to untap the full potential of our greatest economic asset.

The EUs Single Market is home to 450 million people and 26 million businesses.

What should be a world-beating engine for growth remains remarkably underdeveloped.

This is especially when it comes to our Single Market for services.

We have announced a Single Market Roadmap to 2028 to increase the pace of removing internal barriers.

We must also do more to integrate European capital markets to better channel household savings – estimated at €10 trillion – towards the productive investments that will provide for our future prosperity.

Our strategy for a Savings and Investments Union provides the framework to achieve this goal.

The European Commission is determined to do what is necessary to meet the moment, maximise our many advantages and improve Europes competitiveness to secure our long-term prosperity.

Next to simplification.

The European Commission has identified cutting red tape as the key to unlocking Europes full competitive and productive potential, thereby securing our long-term prosperity.

Simplification means making EU rules and regulations simpler, more proportionate and easier to navigate.

It means allowing our businesses the freedom to redirect their time, energy, and resources away from paperwork and towards innovation, investment, and growth.

It means rewarding dynamism and rejecting inertia.

We have a clear roadmap to guide our simplification agenda and are already moving forward at pace and with purpose.

We have been listening to those navigating our rules and regulations when designing our simplification proposals.

This engagement has already fed into our proposals and led to real changes that can make a real difference.

Since the beginning of this year, the European Commission has presented six simplification omnibus proposals, including in agriculture, defence, due-diligence, and sustainability reporting.

These proposals will result in less paperwork, less overlaps, less complex rules.

A conservative estimate puts the annual savings stemming from these simplification proposals at around €8.4 billion.

Further omnibus proposals are on their way in the coming months, including on digital and environmental requirements.

But this is just the beginning.

Our overall objective is to simplify administrative procedures to reduce costs by 25% for all companies and by 35% for SMEs.

This means cutting around €37.5 billion in annual administrative costs by the end of this Commissions mandate in 2029.

Again, I am heartened that the Danish Presidency recognises the importance of reducing regulatory burdens and has prioritised implementation of the simplification agenda.

The European Commission is determined to deliver on a simplification agenda that encourages investment, innovation and scaling here in Europe.

And we are now working towards an ambitious Commission work programme for the next year, including further simplification proposals.

We must ensure that our rules and regulations work for our citizens and businesses, not against them.

Finally, a word on the digital euro project.

The digital euro is a powerful symbol of our commitment to be at the forefront of embracing the digital age and making the most of all the opportunities that it offers.

It will play an important role in modernising and securing the resilience of the EU payments market.

It will safeguard the important role of public money in our society and be an engine for competition and innovation in the European payments market and the wider economy while preserving citizens privacy.

Recent developments in todays more complex, conflictual world have also underlined the urgency of making progress on the introduction of the digital euro.

The digital euro can be an important pillar of strengthening the EUs strategic autonomy by increasing the euros resilience vis-à-vis other currencies, payment systems, and “stablecoins” not denominated in euro.

We simply cannot afford to cede technological control over the EUs financial system and economy entirely to others.

The European Commissions proposals on the establishment of the digital euro are currently under discussion in the Council and the Parliament.

I am hopeful, especially given the impetus that current global developments are providing, that we can make important progress on the digital euro in the weeks and months ahead.

I am heartened that the Danish Presidency shares this urgency and has prioritised negotiations on the legal framework with a view to securing an agreement in Council by the end of the year.

And I would like to commend them for the progress already made and, once again, reaffirm the Commissions commitment to provide all necessary support.

To conclude, ladies and gentlemen, Europe has reached a crossroads.

We can and must take decisive action, while safeguarding our democracies and the rules-based system.

The European financial industry has a crucial role to play here.

Private investment is essential to boost our competitiveness and defence capabilities.

The EUs diverse and resilient financial system has vast potential to channel more savings towards these productive investments.

European policymakers must empower our financial industry to get on with this work.

In doing so, I am confident that, as we have done many times before, Europe will meet this moment.

Thank you.