Further change is on the way with Capital Markets Union (CMU)6, an important response to the challenge of achieving more diversified sources of funding of the European economy, wider opportunities for investors, and broader risk sharing. The objective to diversify the funding mix, reducing reliance on traditional funding models, is a valuable one.
A decline in capital-intensive production and a rechannelling of investment to countries with lower costs, such as the new EU member states, may have contributed to the low level of investment. Increasingly fragile demographics may be another reason for the subdued propensity to invest.