In panel remarks, European Central Bank President Christine Lagarde argued that Europe must make greater use of its domestic market as its post-war growth model is weakened by trade restrictions, higher energy costs and geopolitical pressures. She called for the removal of barriers within the EU single market and deeper capital market integration to help firms expand, accelerate the diffusion of artificial intelligence and turn domestic demand into a more durable source of growth. Euro area firms expect to allocate about 9% of total investment to AI in 2026, but competitive pressures to adopt the technology remain largely confined within national borders. Financing constraints also intensify as innovative businesses grow. By their tenth year, EU scale-ups have raised about 50% less than counterparts based in San Francisco, while 12% of EU scale-ups have relocated outside the bloc. Lagarde highlighted the proposed optional EU-wide corporate legal form, known as EU Inc., as one route to help companies operate across the bloc under a single set of rules. She also noted that EU leaders have called for agreement on the market integration package by the end of 2026.
2026-08-19European Central Bank
European Central Bank President calls for deeper single market and capital market integration to scale European innovation
European Central Bank President Christine Lagarde called for deeper EU single market and capital market integration to help innovative firms scale and spread AI across the economy. She highlighted national market barriers and a widening financing gap for EU scale-ups. EU leaders are seeking agreement on the market integration package by the end of 2026.