ECB’s Lagarde: Geopolitical Landscape Is Fragmenting Into Rival Blocs

18 November 2024

By Marta Vilar – MADRID (Econostream) – European Central Bank President Christine Lagarde said on Monday that the world was splitting into opposing blocs.

In a speech at ‘Les Essentiels des Bernardins’ in Paris, Lagarde said that ‘attitudes towards free trade are being called into question and approaches to regulating the technology sector are diverging among advanced economies.’

In a world driven by quick technological advances, Europe was ‘no longer at the forefront of progress’ as in the past, according to Lagarde.

‘Our productivity growth – the key factor driving our long-term prosperity – is diverging from the United States’, she observed.

Previous ‘economic dependencies’ were now becoming ‘geopolitical vulnerabilities’, she said.

‘Europe’s economy, more open than others and characterised by a trade-to-GDP ratio exceeding 50%, is now facing pressure in an increasingly inward-looking global environment’, she said.

The character of the EU as a ‘loose club of independent economies’ was no longer valid as geopolitical fragmentation worsened, according to Lagarde.

‘Today we need to see ourselves as a single, large economy with predominantly shared interests’, she said.