Despite current uncertainty and sharp market declines, Luis de Guindos expresses optimism, suggesting this situation serves as a wake-up call for Europe to become more autonomous and independent in energy, defense, and economic sectors.
Guindos advocates for negotiations with the United States with “a cool head” without Europe appearing weak, emphasizing the need to demonstrate strength and a willingness to negotiate, as stated during his speech at the assembly of the Spanish Banking Association (AEB).
He also argues that Europe should complete the integration of goods and services markets, which hampers productivity, as well as the unification of capital markets and the establishment of a banking union.
Guindos insists that “the most important” action is to work collectively. “If Europe is divided, it will be more complicated,” he warned.
For now, he observed, Europe’s response to measures by U.S. President Donald Trump has been “prudent, cautious,” and “intelligent,” but he warned that failing to integrate goods and services markets disadvantages Europe.
Guindos noted the absence of discussions on the labor market and a common labor regulation, which he sees as beneficial.
The European Central Bank’s vice-president reminded that Europe typically makes correct decisions during uncertain times, hoping this will again be the case. Otherwise, “we will miss the opportunity,” he cautioned.
Guindos highlighted the high levels of capital and liquidity within Spanish and European banks, ensuring continued support for the productive economy.
“There is nothing like having a solvent and liquid bank in times of concern,” he praised, though this hasn’t prevented significant stock market declines.
“There has been no panic,” Guindos emphasized, adding that markets are now worried about the possibility of a second round of tariffs leading to a trade war.
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