Europe's GDP share has dropped from 90% to 65%, and Damon bluntly states: This is not acceptable.

According to a report from (Financial Times), Damon bluntly pointed out in his speech that Europe's economic performance is lagging behind. He stated, 'The GDP share of Europe compared to the United States has dropped from 90% to 65% over the past 10 to 15 years. This is not good.'

Damon further emphasized that US companies have scale advantages and global competitiveness, while European companies, despite their potential, are gradually losing dominance. 'We have a large and strong market, our companies are very successful, with global scale. Europe once had these advantages, but they are becoming increasingly scarce now.'

'The single market should be fully integrated': Fragmented systems are holding Europe back.

Damon believes that if Europe wants to rejuvenate its competitiveness, it must complete 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, etc. 'Everything should be part of the single market,' he told the (Irish Examiner).

In fact, European leaders and businesses have repeatedly called for accelerating the integration of capital markets and banking unions, while simplifying cumbersome tax 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, which is also seen as a significant factor weakening competitiveness. As US-China trade relations become increasingly strained, Europe's vulnerabilities are further magnified, highlighting the urgency of strengthening regional sovereignty and strategic resource management.

Investors are optimistic about Europe in the first half of the year, but challenges remain heavy.

Nevertheless, the European market performed surprisingly well in the first half of 2025, attracting considerable attention from investors. Market sentiment turned optimistic, partly due to Germany's fiscal stimulus measures, increased defense spending, declining interest rates, and relatively stable politics in the region. These factors not only propelled a strong rebound in the stock market but also attracted inflows from private equity funds seeking value investment opportunities.

But Damon reminds that the EU still faces formidable tasks, including implementing reform policies conducive to economic growth and solidifying relations with the United States, the largest trading and investment partner. As of Friday morning, the EU and the United States had still not reached a concrete consensus on tariff agreements, leaving it unresolved.

The US market reacted coolly to tariff news, and Damon warned against excessive confidence.

Regarding the latest wave of tariff policies from President Trump, Damon also expressed concerns about the market's reaction. Trump announced this week a 50% tariff on imports from Brazil, a 50% tax rate on copper, and even threatened punitive tariffs of up to 200% on pharmaceuticals.

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

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

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

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

In fact, Damon warned at a meeting last month that the US economy could enter a recession in the coming months, 'Real data is likely to deteriorate soon.'

  • This article is authorized for reprint from: (Chain News).

  • Original title: (Is Europe's competitiveness continuing to decline? JPMorgan CEO warns: You are losing your advantage).

  • Original author: Elponcho.

'Europe's GDP share has dropped to 65%! JPMorgan CEO warns: You are losing your advantage' This article was first published in 'Crypto City'.