BAKU: Integration can improve Europe’s energy security, said Alfred Kammer, Director, International Monetary Fund’s (IMF) European Department, at the ECB House of the Euro, Brussels, Trend reports.

He noted that since the outbreak of the war in Ukraine, European energy security needs have risen.

‘In a forthcoming study we find that integration would improve energy security along two dimensions: security of supply and economic resilience. The example of the electricity markets is instructive. Deeper integration would increase electricity trade between European countries. Even though more electricity trade would increase import dependence, it would reduce the geographic concentration of energy imports among non-European suppliers. Countries also become less sensitive to energy supply disruptions because energy prices and hence energy expenditures fall,’ said Kammer.

He went on to add that the way to higher growth may lead through the Single Market.

‘A recent IMF study finds that reducing remaining barriers
to the Single Market for goods and services by 10 percent could raise European output by as much as 7 percentage points over the long term. Trade integration in the EU is still only a fraction of the level observed among US states. Services trade, in particular in transportation, distribution, and logistics, remains constrained,’ added Alfred Kammer.

He went on to add that these markets need to be opened up to raise incentives for productivity improvements.

‘Where they are open, harmonized regulations, lower administrative and legal barriers, and streamlined trade procedures would also lower business costs. Better border infrastructure, such as transportation, ICT, energy, and financial payments within Europe alone could lift Europe’s trade and incomes by about 1.6 percent over the long-term,’ said Kammer.

Source: Trend News Agency