Welsh Conservatives in the European Parliament
Dr Kay Swinburne MEP

EU2020: Opportunities for the EU financial services sector, 07.11.11

Thank you to CityUK for inviting me to this event and giving me an opportunity to talk about something positive. I feel I often deliver the doom and gloom speech about the onslaught of EU financial services legislation - many of you will have heard me opine on EMIR, MiFID and even the FTT. Yet today I have been asked to speak on a much more pleasant acronym - the EU2020.
EU2020 is about restarting the EU economy. All of the austerity measures in the UK and across the EU will only yield results if we manage to put the EU back on course to growth. So, the EU2020 is a list of some 50 targets, a road map for all future EU initiatives, to bind them together and achieve focus as well as unity of purpose.
For me, the most important target is that 3% of EU GDP should be invested in research and development - both private and public. I started my career as a biomedical scientist and then used my knowledge and skills as a corporate financier to facilitate capital and funding getting to pharmaceutical and early stage biotech companies engaged in researching the innovation that we now so desperately need. While some of my Parliamentarian colleagues would like to believe that all bankers are "casino" bankers and all financiers are immoral, I try to remind them of the role you play in getting capital to the real economy they want to see grow.
Yet perhaps this is also the answer to the question of what opportunities the financial services sector can gain from EU2020. Currently the EU is trying to use the little resources it has to target growth industries - yet in my experience civil servants and bureaucrats are the worst qualified to choose winners. Yet venture capitalist, private equity and banks do it everyday. You choose which companies to invest in, what conditions need to be applied in order to ensure meeting stability and product success, and which to foster long term relationships with for your own future symbiotic growth in a risk managed way.
Now that credit is harder for banks to come by and future higher capital requirements will mean that there genuinely will be less money for banks to lend out to businesses, EU money could provide opportunities to boost available investment capital. The banks providing the co-investment and business acumen to select the investment opportunities. Speaking as MEP for a constituency that still receives EU money in the form of grants via structural funds, my observations are that they are often spent on unsustainable projects that do not last longer than the EU initial investment, I would love to see some EU money invested not spent to then be returned to the pot for investing in the next generation of growth businesses.
Although keen to learn that Barclays, Lloyds, Santander and RBS have received EU money in the past for partnership schemes co-investing with the EIB, I question why it cannot be done more. Under the current Framework Seven research and innovation programme the UK has received 2.8 billion - out of 37 billion spent so far, Spain and Italy have each received more that 6 billion, France and Germany 4 billion each. The UK has some the best universities in Europe, and a highly skilled population, we need to be better at tapping this potential and getting products out of the research lab, launched in the market and made profitable. Surely our skilled financiers can aid our scientists and academics in sourcing all available funds to ensure the cheapest and most suitable capital is available to them at whatever stage of development and commercialisation.
Beyond the specifics of the EU2020 and the digital agenda and the innovation partnership, I think we also need to find the opportunities in other legislation - not just focus on the negatives and the costs, but look at the opportunities that could be created through the benefit of the EU's single market, facilitating pan European trade in goods and services, I also think we can use new frameworks to launch new ideas - I believe in the power of the financial services sector to innovate - and not just more complex financial products.
Within MiFID II is a proposal for the creation of an SME market. Of all the lobbyists battering down my door from the City of London and beyond, only one has referred to this - and they saw potential.
While we may have AIM in the UK currently, no-one claims this is the universal model for SME funding. Perhaps the future SME market could be structured so that smaller companies are encouraged to reduce their reliance upon bank loans and general debt, and instead look at the equity option. We could look at facilitating this governmentally by discussing how tax treatment could evolve to support a new structure of this kind. It is conceivable that we could create a new SME index that people could invest in, like social or ethical investment options and policies. Or specifically designate an SME Growth asset class with preferential tax benefits.
After two and half years of sitting on the economic and monetary affairs committee and fighting against the excess of financial services legislation, I would love for a financial institution to come forwards with a positive proposal for me to stand up in Parliament and trumpet - I truly believe that the financial services sector has a lot to offer the rest of the economy. The financial sector should be able to come up with real and credible plans to convince politicians and the public that they really are the lynch pin for real economic recovery in Europe.
Finding innovative ways to improve the functioning of the markets so that liquidity increases across the whole spectrum of market cap – finding the key to funding entrepreneurs, why can’t we have a more active EU venture capital strategy? We need to seek to positively engage our long-term investors in the growth opportunities over a long term horizon that our smaller companies offer. Pension funds committing to a percentage of their investments in smaller high growth potential companies would have a positive impact on both liquidity and encourage the equity funding model whilst boosting their returns.
The industry needs to promote its financing role and corporate finance activities need to sense SMEs as well as the global players’ acquisition strategies. The opportunities to be a player in the EU 2020 Strategy is also an opportunity to re-engage with the businesses you serve – growth is key to the EU’s future and I believe very much in the hands of your services.
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Welsh Conservatives

The European Commission has today designated European Protected Geographical Indication (PGI) status to the well-known Pembrokeshire Early Potato from West Wales.
The Pembrokeshire Early Potato was one of only three quality farm products whose applications for PGI status were approved today.
The EU PGI schemes protect product names against misuse and under these schemes more than 1200 products are already protected.
Commenting on this announcement from the European Commission today Dr Kay Swinburne MEP – who is from West Wales - said:
"I am delighted to see that this application to have "Pembrokeshire Earlies" added to the register of PGI products has been approved by the European Commission today."

"Achieving this prestigious status is a clear acknowledgment of the high-quality and distinctive produce we continue to deliver in Wales. Pembrokeshire Early Potatoes thoroughly deserve their place alongside the well-known food and drink products from right across the EU which already feature on the PGI register."


Kay was delighted to host an event to celebrate Higher Education, Science and Innovation in Wales last night in the European Parliament.  The event builds on the British Council’s “Strategic Analysis of the Welsh Higher Education Sector, Distinctive Assets”.  A number of experts spoke to share their views of Welsh HE at the event and how it can develop in the future.

In advance of the 'Fox-Hafner Report' vote on the single seat for the European Parliament, Kay and the other UK Conservative MEPs feel it is right to draw attention to the fact that the seven-year cost of the dual-seat arrangement comes to £928,000,000. Since her election to the European Parliament in 2009, Kay has strongly supported bringing the monthly Parliamentary meetings in Strasbourg to an end and therefore saving taxpayers a considerable sum of money.


Kay was delighted to meet Malala Yousafzai, who was awarded the EU's Sakharov Human Rights Prize at the European Parliament today.

Following Malala’s speech to the European Parliament, Kay said, “What an inspirational speech Malala gave to the Members of the European Parliament today. As a mother of young children myself, I hope that they can also aspire to achieve like her. Malala is an exceptional young lady who has overcome adversity by tremendous force of character and a passionate belief in the right of everybody to enjoy and benefit from education.”   


Kay was very pleased to meet with members of the Advanced Manufacturing Research Group at the European Parliament in Brussels, one of four groups set up in key Welsh research strengths to engage with EU research funds. The delegation visiting Brussels included representatives from Cardiff University, Bangor University, Swansea University and Trinity St.Davids University.

In advance of tomorrow's European Council meeting of leaders, Dr Swinburne has echoed the recommendations made in a recent report published by a number of business leaders, which highlights the importance of removing barriers to business competitiveness in Europe and getting rid of burdensome legislation by cutting EU red tape.

Last year Dr Swinburne encouraged businesses in Wales to highlight to the European Commission which over-burdensome regulations they would like to see slashed, by writing to small businesses all over Wales and asking them to tell her their red-tape problems.

Electronic cigarettes no longer face being taken off the shelves by the EU after Conservative MEPs were successful today in amending EU legislation on tobacco labelling.

Conservative MEP's led the amendment to defeat proposals that would have classified e-cigarettes as medicinal products, meaning they would have to undergo an overly burdensome and costly authorisation procedure, which would go beyond the procedures for traditional tobacco products... (Read more under 'Articles')



Welsh Conservative MEP Kay Swinburne has been sitting down with leaders in Europe's biotech field to choose the top five candidates to compete in this year's EuropaBio Most Innovative EU Biotech SME Award.

As a member of this year's judging committee, Kay is once again supporting the EuropaBio award, which has attracted applications from all three sectors of biotechnology - healthcare, industrial and agricultural, from across the EU... (Read more under 'Articles')


WELSH Conservative MEP Dr Kay Swinburne today hailed a vote in the European Parliament as a "wake-up call" in the battle to save Europe's endangered languages.

MEPs meeting in Strasbourg backed a report which calls on governments across the EU to develop action plans to encourage continued linguistic diversity.

The report, written by Corsican MEP François Alfonsi, also says governments should be "more attentive" to threats which may lead to languages becoming extinct.

Dr Swinburne, who was a shadow rapporteur for the report, has argued that Welsh can be seen as a positive example of language revitalisation which communities across the EU should follow... (Read more under 'Articles')

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Dr Kay Swinburne MEP
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