By Zdeněk Drábek
11 May 2026
An interesting and important piece of news has finally emerged from the EU after a long time. At the end of January, Reuters reported that the German finance minister and Social Democratic vice chancellor, Lars Klingbeil, is planning the creation of a new bloc made up of the six leading economies of the European Union. In a letter, he invited partners from France, Poland, Spain, Italy and the Netherlands to talks aimed at improving decision making processes and reviving the EU economy.
According to Klingbeil’s vision, closer cooperation and deeper integration between these six leading countries should focus primarily on capital markets, defence investment and securing key raw materials. “Now is the time for a two speed Europe,” Klingbeil declared in January at an economic conference organised by the newspaper Die Welt.
Why is there pressure for deeper European integration?
The first reason is geopolitics. The world is changing. Following Russia’s “special operation” and aggression against Ukraine, American president Donald Trump launched his own “special operations” in Venezuela and Iran, and it is only a question of whether China will see these interventions as an opportunity to pursue its own interests in places such as Taiwan or Vietnam. The world is shifting towards a sphere dominated by large and powerful players. President Trump has effectively undermined NATO’s core agreement of providing security guarantees to Europe by calling for the military occupation of Greenland. Military aggression from both the United States and Russia threatens European security, and a militarily weak Europe must act.
The second reason is Europe’s energy security, which is also seriously threatened by Russian aggression, American intervention in Iran and the EU’s lack of a unified energy policy. Dramatically rising oil and gas prices on world markets, caused by disrupted supplies from the Middle East, are increasing key costs for European companies, reducing competitiveness and fuelling inflation. Full coordination of energy policy within the EU still does not exist because two member states remain dependent on Russian oil.
The third reason is Europe’s economic decline, visible in slow economic growth across all European states. A shared characteristic is that increasing state investment will be extremely difficult because of the dominant weight of mandatory spending on public services, huge state budget deficits and high levels of debt. At the same time, the labour market situation has worsened dramatically due to collapsing natural population growth and a weak supply of local workers. This will weaken further as support for immigration declines.
The only solution for restoring economic growth in Europe is to strengthen the factors leading to faster productivity growth. If there is no access to additional labour, companies must find ways to use employees more efficiently and increase the effectiveness of capital. This requires reducing costs created by regulations at both national and European level. Even more importantly, it requires creating a much larger internal market governed by common rules. This primarily means integrating the financial sector, including banks, private equity firms, hedge funds, stock market operations and harmonised rules for issuing new shares. It also requires harmonisation of member states’ fiscal rules, which is a major challenge.
The fourth, and equally important, reason for seeking new forms of cooperation between member states is maintaining living standards. This is especially important for Czechs, who have experienced substantial improvements in living standards over the past twenty years despite criticism of the EU. Growth has been much stronger in the Czech Republic than in most original EU countries, partly thanks to transfers of EU resources aimed at helping convergence with average EU living standards, a goal that has now largely been achieved. A similar acceleration in living standards will not be possible unless the economic growth of the entire union speeds up.
What does this mean for EU member states and for the Czech Republic? First, we must admit that we face major challenges, that we need to discuss them openly and reach sensible conclusions quickly. We need this debate now because we too must solve the energy crisis, national security concerns, growing labour shortages, the revolution in IT and AI, and the financing of public services. Every one of these challenges will require solutions beyond individual states, meaning cooperation. If all countries cannot agree, then the emergence of a strong group of six countries is a solution.
Europe, including the Czech Republic, has relied for years on American military and security guarantees, and these are now increasingly uncertain. Europe needs to strengthen its own defence capabilities. NATO security guarantees from the United States still theoretically exist, but President Trump has also considered withdrawing the US from the alliance. This comes at a time when Europe’s security policy is fragmented and lacks agreement among all 27 member states. If we do not join the countries significantly increasing their defence budgets, we are effectively telling our partners: we want to be members of the EU, but we expect you to protect us for us.
Economically, this means supporting modern technologies, innovation and strategic foreign investment. It will require creating conditions that remove barriers to integrated financing harmonised across EU borders. Only then can new sectors grow and existing industries adapt dynamically.
The Czech Republic is especially vulnerable in this respect. Our market is too small to allow start ups to grow into globally competitive firms. The non banking financial sector, which is essential for the growth of start ups, is still underdeveloped in the Czech Republic. Czech start ups and expanding manufacturing firms will need access to strong non banking companies from willing EU countries. A good example is the Czech holding company CSG, which raised around CZK 86 billion by listing part of its shares on the Amsterdam stock exchange and, despite current difficulties, has the potential to become a global player in the defence industry.
Hungary and Slovakia still insist on importing Russian gas and oil, making it unrealistic to expect them to coordinate or adapt to a common EU energy policy. If this policy requires new sources of funding, conditions will emerge only for cooperation among “willing partners”. Cooperation with these partners will in any case be necessary in negotiations over gas and oil purchases.
If this strong group of six cooperating countries is prepared to pursue deeper integration, we are free either to join them and benefit significantly, or remain outside and complain, as we already do, that a two speed Europe divides the EU. But a two speed Europe does not divide the EU, it strengthens it. Greater competitiveness among the six countries will accelerate their economic growth, which will then drive growth across the rest of the union. A functioning common energy policy negotiated by these six countries with energy exporters would also benefit the other members.
We face a choice between joining this group of strong countries and benefiting greatly from it, or remaining on the sidelines of important developments and losing influence. Our choice is whether to think like a confident and important EU member, or as a small and insignificant troublemaker from Central Europe.
The author is a former adviser to the World Bank and the WTO.