DUBAI (Realist English). European leaders should “listen very carefully” to the recommendations of former European Central Bank president Mario Draghi as the bloc looks for ways to offset the economic impact of tariffs, the head of the Organisation for Economic Co-operation and Development said.
Speaking to Euronews on the sidelines of the World Governments Summit, OECD Secretary-General Mathias Cormann described the European Union as a “uniquely successful story” that nonetheless faces mounting structural challenges in a rapidly changing global environment.
“The EU has to position itself in the best possible way in evolving circumstances,” Cormann said, noting that international trade rules and multilateral cooperation are increasingly being put to the test.
Cormann pointed to a 2024 report by Draghi calling for a fundamental overhaul of how the EU functions. Earlier this week, Draghi reiterated his view that the bloc should operate more like a “true federation” rather than a loose collection of individual states. “Mario Draghi is an exceptional leader,” Cormann said. “Everybody would be well-advised to listen very carefully.”
EU leaders are due to gather next week for an informal retreat in Belgium, which Draghi is expected to attend at the invitation of European Council President António Costa. Costa has previously said he expects heads of state and government to provide “clear political guidance” on implementing Draghi’s proposals, which have so far remained largely unfulfilled.
Draghi has repeatedly argued that without deep reform the EU risks gradual decline in an era of more confrontational geopolitics. His recommendations include closer fiscal coordination, joint borrowing to fund large-scale projects such as defence and security, and deeper integration of Europe’s capital markets to attract and scale up investment.
Despite rising protectionism, Cormann said the global appetite for multilateral, “win-win” trade relations remains intact, even after the introduction of wide-ranging US tariffs and the growing use of trade surpluses as a political tool.
At the same time, he acknowledged what he called “legitimate concerns” over market distortions, particularly in relation to China. The EU has warned Beijing about its widening trade surplus with Europe and the risk of a second “China shock” as excess industrial output is pushed onto global markets.
“There are areas where we are concerned about market-distorting practices and excessive levels of state subsidies,” Cormann said, adding that the OECD would prefer “stronger alignment with market-based practices” to preserve open and stable global trade.
