Former ECB chief Mario Draghi urges Europe to overcome divisions and federate to avoid subordination to the US and China, warning of fragmentation and deindustrialisation.
LEUVEN: Europe must overcome its “old divisions” to become a “genuine power” or risk remaining “subordinated” to the United States and China, former European Central Bank chief Mario Draghi (pic) warned.
The ex-Italian prime minister delivered the warning in a speech at KU Leuven university, where he received an honorary doctorate.
“Of all those now caught between the US and China, Europeans alone have the option to become a genuine power themselves,” Draghi said.
He presented Europe with a stark choice between remaining “merely a large market, subject to the priorities of others” or taking steps to become one unified power.
Draghi argued Europe is caught between a tariff-imposing US and a China willing to exploit its control of global supply chains.
“This is a future in which Europe risks becoming subordinated, divided, and deindustrialised — at once,” he cautioned.
He warned that a Europe unable to defend its interests would not preserve its values for long.
Draghi noted the US administration had made “clear” it sees “European political fragmentation as serving its interests”.
To avoid this fate, he said the EU must diversify trade and move from a loose confederation towards a federation.
“Where Europe has federated — on trade, on competition, on the single market, on monetary policy — we are respected as a power and negotiate as one,” he stated.
“Where we have not — on defence, on industrial policy, on foreign affairs — we are treated as a loose assembly of middle-sized states.”
He argued integration could proceed at different speeds but was necessary for survival under a “now defunct global order”.
“We are all in the same position of vulnerability, whether we see it yet or not,” Draghi said. “The old divisions that paralysed us have been overtaken by a common threat.”
Draghi authored a landmark 2024 report on the EU economy with hundreds of recommendations, few of which have been implemented.
He is set to join an informal gathering of European leaders focusing on competitiveness in Alden on February 12.
