Lagarde: Eurozone Economic Recovery Delayed

  • Lagarde said that the eurozone economy should not deviate from the recovery track.
  • Lagarde believes that the new coronavirus epidemic has not only promoted economic transformation but also brought challenges.
  • Vaccine demand fears rise amid EU export pressures

European Central Bank President Christine Lagarde said the economic data from the fourth quarter of last year showed the eurozone’s economic recovery process has been delayed. Lagarde made these remarks at the 25th meeting of the World Economic Forum Dialogue, “Davos Agenda.”

The Davos Agenda is a pioneering mobilization of global leaders to shape the principles, policies and partnerships needed in the challenging new context of the pandemic.

“Our hope is that still 2021 is the year of recovery but in two phases and phase one is clearly one that it is still plagued with a very high level of uncertainty,” she said at a panel moderated by CNBC.

Lagarde said that the eurozone economy should not deviate from the recovery track.

To this end, fiscal policy still needs to play a leading role, while maintaining a proactive monetary policy to ensure favorable financing conditions to support the recovery of all economic sectors in the eurozone.

According to Lagarde, “the current economic environment is still about crossing that bridge to the recovery, but where the journey seems to be a little bit delayed, but should not be derailed.”

Lagarde pointed out that 2021 is expected to be the year of recovery, but the first stage of recovery will still be accompanied by a high degree of uncertainty, and the second stage will be the transition to a “new economy,” characterized by digitalization and green.

Lagarde believes that the new coronavirus epidemic has not only promoted economic transformation but also brought challenges.

On the one hand, progress has been made in digitization and telecommuting, and all parties have paid more attention to addressing climate change. On the other hand, the actual level of unemployment has risen, especially the unemployment risk of low-skilled workers.

At the same time, the epidemic continues to affect production and non-production sectors in the Eurozone, and corporate R&D expenditures have also declined.

Lagarde said that while maintaining the strength of fiscal and monetary policies in the Eurozone, investment should be more targeted to lay the foundation for the new economy. The World Economic Forum held the “Davos Agenda” dialogue online, from the 25th to the 29th.

More than 1,500 leaders of political, business, and social organizations from more than 70 countries and regions around the world are discussing five major topics, including building resilience, a sustainable and cohesive economic system, promoting responsible industry transformation and growth, improving global commons governance, using the technological achievements of the Fourth Industrial Revolution, and promoting global and regional cooperation.

Vaccine Demand Fears Rise Amid EU Export Pressures

Coronavirus vaccine

Vaccine availability has been crucial as nations attempt to curb elevated rates of infection.

Separately, the German health ministry supported AstraZeneca in firmly rejecting any claims of reduced effectiveness rates for older people.

AstraZeneca said in a statement:

“While there is no scheduled delay to the start of shipments of our vaccine should we receive approval in Europe, initial volumes will be lower than originally anticipated due to reduced yields at a manufacturing site within our European supply chain.”

“We will be supplying tens of millions of doses in February and March to the European Union, as we continue to ramp up production volumes,” they added.

Late Monday, news outlets each announced that the vaccine had an effectiveness of less than 10 percent in those over 65, and that the German government was arranging for the European Health Care Regulator to clear it only for those under that level. AstraZeneca identified rumors as absolutely inaccurate.

Once questioned about the possibility of clearance only for teenagers and young adults, German Health Minister Jens Spahn’s spokesperson said it was up to EU authorities and AstraZeneca testing had a smaller rate of the older population.

Doris Mkwaya

I am a journalist, with more than 12 years of experience as a reporter, author, editor, and journalism lecturer." I've worked as a reporter, editor and journalism lecturer, and am very enthusiastic about bringing what I've learned to this site.  

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