Is Europe's competitiveness continuing to decline? JPMorgan CEO warns: You are losing your edge.

JPMorgan Chase CEO Jamie Dimon recently made candid comments at the Irish Foreign Ministry, highlighting a heavy reality for Europe on the global economic stage — Europe is steadily losing ground in competition with the United States and Asia. Dimon's remarks not only reignited concerns about EU economic integration and institutional reform but also underscored the current market's excessive confidence in the direction of the global economy.

Europe's GDP share has dropped from 90% to 65%, and Dimon bluntly stated: this is not acceptable.

According to the Financial Times, Dimon pointed out in his speech that Europe's economic performance is lagging behind. He stated: "The GDP ratio of Europe to the United States has declined from 90% to 65% over the past 10 to 15 years. This is not good."

Damon further emphasized that American companies have scale advantages and global competitiveness, while European firms, despite their potential, are gradually losing their dominant position. "We have a large and strong market, and our companies are very successful, with a global scale. Europe once had these advantages, but they are becoming increasingly rare now."

"The single market should be fully integrated": Fragmentation of the system hampers Europe.

Damon believes that if Europe wants to revive its competitiveness, it must complete a genuine single market integration. He pointed out that this involves not only trade liberalization but also banking unification, common financial disclosure rules, transaction transparency, climate policy standards, and more. "Everything should be part of a single market," he told the Irish Examiner.

In fact, European leaders and the business community have repeatedly called for accelerating the integration of capital markets and banking union, while simplifying cumbersome tax systems and regulatory frameworks to inject more momentum into the regional economy.

Geopolitical risks are rising, and Europe lacks key sovereign capabilities.

Europe's autonomy in strategic areas such as energy, critical minerals, data centers, satellite communications, and digital services is evidently insufficient, and is seen as a significant factor undermining competitiveness. As U.S.-China trade relations become increasingly tense, Europe's vulnerabilities are further amplified, highlighting the urgency of strengthening regional sovereignty and strategic resource management.

In the first half of the year, investors were optimistic about Europe, but challenges remain heavy.

Nonetheless, the performance of the European market in the first half of 2025 has been surprising, attracting the attention of many investors. Market sentiment has turned optimistic, partly due to Germany's rollout of fiscal stimulus measures, increased defense spending, declining interest rates, and relatively stable politics in the region. These factors have not only driven a strong rebound in the stock market but also attracted inflows of funds from private equity firms seeking value investment opportunities.

However, Daimon reminded that the EU still faces a daunting task, including implementing reform policies that are conducive to economic growth and solidifying its relationship with the United States, its largest trade and investment partner. As of Friday morning, no concrete consensus had been reached on the tariff agreement between the EU and the United States, which remains unresolved.

The U.S. market reacts lukewarm to tariff news, Dimon warns of excessive confidence.

Regarding the latest wave of tariffs announced by President Trump, Dimon also expressed concerns about the market's reaction. This week, Trump announced a 50% tariff on imported goods from Brazil, a 50% tax on copper, and even threatened to impose punitive tariffs of up to 200% on pharmaceuticals.

Although these measures may put pressure on inflation and economic growth, the market response has been relatively calm, with the S&P 500 and Nasdaq indices in the US reaching new highs on Thursday. However, early trading on Friday showed a slight fatigue in market sentiment.

Damon stated that the market has become "somewhat numb" to such news, and investors are falling into a "complacent mood."

Inflation unresolved, interest rates may rise again? The market underestimates the risks.

On the issues of inflation and interest rates, Dimon also poured cold water. He pointed out that although the market generally only believes there is a 20% chance of another rate hike, he thinks the actual risk should be "between 40% and 50%", which poses serious concerns for investors.

In fact, Dimon warned at a meeting last month that the U.S. economy could enter a recession in the coming months, saying, "Real data is likely to deteriorate soon."

Is this article about Europe's competitiveness continuing to decline? JPMorgan CEO warns: You are losing your advantage. First appeared in Chain News ABMedia.