Outgoing European Union (EU) Commissioner for Internal Market and Services Michel Barnier on Monday warned of the risk of new financial crises, calling on the EU to put its "political will" at the service of the economy.
In a lecture delivered at the Bocconi University in Milan, Barnier said one of the main lessons he has learnt from his five years in the European Commission (EC) was the "necessity to always remain vigilant" for possible new risks in financial stability.
"The crises which have been hitting Europe since 2008 have not finished. We have certainly overcome the worst period, but we are still in the middle of the economic crisis triggered by the financial crisis," he said. The commissioner warned of the "continuous risks in the financial sector."
In his view, the so-called too big to fail financial institutions, the lack of global coherence in the application of rules, the uncontrolled development of shadow banking and the strong reliance of companies on the banking sector are the four elements that the EU should especially watch out for.
During his mandate that will officially end on Nov. 1 when the new EC will take up duty, Barnier said he and his fellow commissioners proposed more than 40 pieces of financial regulation covering all the measures agreed jointly in the G20.
These include strengthening the rules applicable to banks, creating a framework for bankers' bonuses and bringing transparency to trading in derivatives, he elaborated.
Barnier pointed out that the EU has also gone further than the G20, in particular with the banking union. New measures and regulations should be conducive to strengthening the euro area, addressing the fragmentation of financial markets in Europe and protecting taxpayers and citizens better from risks taken by banks.
Many of these achievements would have been unthinkable only a few years ago, he noted, stressing however that financial stability is necessary but not enough to get the economy moving again.
The EU, Barnier highlighted, also needs to use all its "political will" to promote growth and employment of the single market, making sure that they benefit all of Europe's businesses and individuals, be they workers, consumers, entrepreneurs or independent professionals.