The European Commission is asking the EU’s top telecom firms whether tight financial restrictions imposed on banks following the financial crisis should be relaxed to boost investment in next-generation infrastructure.
According to an industry survey sent by the Commission to the likes of Deutsche Telekom, Orange and Telefónica, seen by Euractiv, the EU executive is signalling it is willing to revisit its prudential rules limiting risk in banks and insurers during financial crises.
The Commission asks industry whether the rules “influence the willingness of financial institutions to invest in telecommunications infrastructure?”.
Amid economic stagnation, the EU is embracing a “whatever-it-takes” approach to ensure its competitiveness with China and the US. A number of strategic industries, from carmakers to rocket start-ups, have complained that it is difficult to raise financing from local banks in the same way that American companies can.
Loosening the rules could unlock major investment for telecom infrastructure, essential for data transfers and the bloc’s digital economy.
The four questions in the survey covering the loosening of prudential rules appear to stem from recommendations included in a September 2024 report that the ex-president of the European Central Bank, Mario Draghi, delivered.
Draghi mentioned that insurance companies and pension funds were “underinvesting in private companies”, compared to their US counterparts. Additionally, telecom investors met with then-Commissioner Thierry Breton in December 2023 and expressed similar views.
The survey is part of a set of three documents prepared by consultancy agencies Ernst & Young and WIK-Consult on behalf of the European Commission.
(jp)
