The Head Of The ECB Believes That The World Economy Will Change Greatly Under The Impact Of The Pandemic
The impact of the situation created by the COVID-19 pandemic will lead to major changes like the world economy. This opinion was expressed on Saturday by the head of the European Central Bank (ECB), Christine Lagarde. She spoke via videoconference at the economic forum held annually in AIX-EN-Provence (Southern France).
"The current health crisis will strengthen the transformations that have already been latent in our economies. It will lead to a profound change in the entire economic system," Lagarde said. In her opinion, these changes will occur primarily "in the industrial and production sphere, as well as in the areas of labor and trade."
"What we have experienced will accelerate the pace of change and will lead to the formation of a lifestyle that is more ecological and more sustainable," the head of the ECB believes. In this regard, she mentioned the widespread use of remote work during the pandemic. "This will cause a change like work for all paid workers, at least in developed countries, will lead to an increase in the use of digital technologies, in particular in services, and an increase in the scale of automation in industry," Lagarde said.
She said that according to the latest estimates of experts, the pandemic should cause the collapse of supply systems by about 35% and an increase in the use of robotic systems in industry by about 70-75%. There is also already a significant increase in the volume of trade via the Internet, and in the future, this phenomenon will "further increase to the detriment of traditional methods of trade," Lagarde said.
Europe is ahead
She expressed confidence that Europe "has excellent positions that allow it to successfully take advantage of the changes that are taking place." Among these factors is the existence of the Old continent's" world's strongest " closed-cycle economy, that is, based on the renewal of resources. Also, in terms of innovations in the environmental sphere, Europe leads the world, the head of the ECB said. She also mentioned that the issue of "green bonds," i.e. debt securities issued to attract funds to projects that promote environmental protection, is made in most cases in the Euro currency.
At the same time, Lagarde stressed that these factors are "not enough" and that it is necessary to "create a framework for economic policy that will allow mobilizing the direction of financial resources" in this direction of the ongoing changes.