The European Central Bank (ECB) stresses the need for faster progress on the digital euro to ensure Europe does not fall behind global competitors. Legislative delays could threaten the EU's position in the crucial race for central bank digital currencies (CBDC).

Europe Lagging in Global Competition

The digital euro project is facing delays in the European Union. Evelien Witlox, ECB's digital euro project manager, warns that Europe must accelerate its development to remain competitive. In an interview with Euronews, she noted that global players like China and the United Kingdom are already actively testing their digital currencies.

Lack of a Unified Digital Payment System

Europe still lacks a unified pan-European digital payment solution. Out of 20 eurozone countries, 13 do not have their own national card payment systems and instead rely on foreign providers like Visa and Mastercard. According to Witlox, the European market remains fragmented, with the most extensive coverage offered by non-European companies.

To address this issue, the ECB launched a digital euro exploratory project in October 2021. However, progress hinges on the completion of a legal framework, a task that the European Parliament and Council must finalize. Delays in this process, spanning nearly 17 months since the European Commission’s proposal, have raised concerns within the ECB.

Urgency to Speed Up the Process

Despite advancements in discussions about the digital euro, Witlox emphasized that maintaining momentum is critical to ensuring the digital euro is ready when it is truly needed. While no specific timeline for its launch has been set, Witlox expressed optimism, reiterating that Europe remains "at the forefront of CBDC development."

Conclusion: The European Central Bank underscores the importance of swift action to keep pace with global developments in central bank digital currencies. To avoid losing its competitive edge, Europe must not only expedite the legislative process but also establish a cohesive and efficient digital payment solution across the continent.

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