The EU lacks coherent monetary geopolitics strategy beyond digital currency debates, according to Financial Times columnist Martin Sandbu. His analysis identifies critical gaps in Europe's approach to competing with the dollar's global reserve status, particularly as the bloc faces questions about its financial autonomy and international influence.

Sandbu proposes four strategic pillars for Brussels and Frankfurt policymakers. The European Central Bank should accelerate digital euro development with fewer holding restrictions and expand swap lines to non-euro countries. This mirrors how dollar-denominated eurodollar markets boosted US financial reach. Additionally, the EU could promote euro-denominated stablecoins and international monetary public goods to reduce transaction costs for global users.

Economic integration strengthens currency attractiveness, Sandbu argues, making trade liberalization a monetary tool. The EU should link trade negotiations with monetary incentives, potentially offering ECB swap lines alongside trade deals. This follows the bloc's impressive recent trade agreement record, though some deals like Mercosur remain politically uncertain.

The final pillars involve common EU debt issuance and assertive financial statecraft. €200bn in frozen Russian central bank reserves sit idle in Euroclear, representing missed opportunity rather than threat to euro credibility. Meanwhile, hundreds of billions in unused ESM borrowing capacity could fund strategic initiatives if deployed decisively.