‘The Case for Investing in Europe’ debate hosted by AmCham EU on Tuesday, 29 November 2016
Ryan Heath, Senior EU Correspondent, Politico
Susan Danger, CEO, AmCham EU
Michael Collins, CEO, Invest Europe
Jyrki Katainen, Vice-President, Jobs, Growth, Investment and Competitiveness, European Commission
Gerry Murphy, Senior Managing Director & Chairman of Blackstone Group International Partners LLP
Eric Peeters, Global Business Director, Dow Performance Silicones
Joseph Quinlan, Senior Fellow, Center for Transatlantic Relations, Johns Hopkins University
In a fast-changing world with increasing political uncertainties, concerns exist regarding Europe’s attractiveness to international investment. At an Invest Europe and AmCham EU debate, major figures from the corporate and investor worlds shared their views on the prospects for future investment and how policymakers can help.
The single market is a key reason for investment in Europe: no place in the world is as integrated or has so many diverse opportunities.
Other drivers include Europe’s large and wealthy markets, skilled labour, legal stability, innovation and R&D.
US election and Brexit effects are unclear but perhaps not as bad as feared. The key for investors is regulatory certainty.
Fears that the US could disengage from investing in Europe may be ill-founded, concluded a panel of experts from both sides of the Pond. Gathered in Brussels, they examined reasons why the US will surely continue to invest strongly across Europe and may in fact ramp up investment in countries such as the UK (due to a falling pound) and Germany (strong pension funds). Both sides are committed to making Europe a more competitive place, despite challenges such as Brexit and reforms that the EU needs to make, concluded Susan Danger, CEO, AmCham EU and Michael Collins, CEO, Invest Europe.
Joseph Quinlan, Johns Hopkins University, noted: ‘Trump is a businessman and will listen to companies and not do a 180° turn on Europe,’ he added. ‘Europe has many assets and we need your R&D, markets and capital.’ As for trade deals like TTIP, Mr Quinlan reckons the US and Europe need to hit the pause button and educate people on the benefits foreign direct investment and trade.
‘We need to ensure the EU remains dynamic and push Member States to do structural reforms where necessary to survive changing markets,’ said Jyrki Katainen of the European Commission. He added that the Commission is working to increase the flow risk capital in Europe, through the European Fund for Strategic Investments and initiatives such as its €400m venture capital fund of funds. Eric Peeters of Dow Performance Silicones said his company had employed around 16,000 people in Europe for decades and would continue to be committed to the continent: ‘It may be a cliché, but we invest where the market is.’
As for the effects of Brexit, Gerry Murphy of Blackstone Group International Partners reckoned that this could now possibly encourage the EU to complete its single market, which would make Europe even more attractive to US firms. As for investment drivers for long-term investors such as private equity, he said Europe offered the sort of stability needed for investments that require five to 10 years to make a return.
In the panel debate, participants agreed that Europe has work to do integrating its single market, specifically its energy and services markets. A call from all sides was that policymakers consider the potential impact of regulation and the uncertainty that it might create, as this is ‘toxic’ for investors, commented Vice-President Katainen.